the tax breaks are immense if he is servicing a home loan of rs 40 lakh he can claim deductions on interest and principal repaid in fact the amount of principal repaid itself will help in exhausting the entire rs 1 lakh limitbesides the deduction of rs 150000 for interest paid on home loan will lower his tax liability further the combined impact of all deductions will be huge from paying a tax of rs 96820 prior to availing of these exemptions the tax payable will come down to rs 43260 in case he has not opted for a home loan he can claim deductions under section 80c for tuition fee paid for his childrens education age 40 yearsgross taxable income rs 1000000 at these income levels the taxsaving options are almost similar to the rs 700000 bracket a home loan repayment would circumvent the need for making any investments under section 80c exemptions claimed under various sections 80c 80d and 24 would result in the tax payable decreasing from rs 183340 to rs 129265 if the individual has started making contribution to ppf since the age 25 the mandatory 15year lockin tenure would have come to an end under these circumstances if he is not repaying his home loan and consequently is scouting for avenues to invest under section 80c he can consider extending the ppf tenure for another five yearsfor senior citizens the income up to rs 225000 per annum is exempt from tax for this category of assessees experts recommend avoiding instruments entailing a prolonged lockin period however the 9 senior citizens scheme and post office time deposits investments under which are deductible under section 80c are recommended