Quick summary
Under the old tax regime, Bangalore salaried employees can significantly reduce their tax liability through structured investments. Here's what actually works in 2026.
Old regime vs new regime: the first decision
The new tax regime (default from FY 2023-24) has lower slab rates but removes most deductions. The old regime has higher slab rates but allows Section 80C, 80D, HRA, LTA, and other deductions.
For most Bangalore salaried employees earning ₹10–25 lakh with a home loan, ELSS investments, and health insurance, the old regime still results in lower net tax. Your CA should run a comparison for your specific numbers every year.
Old regime deductions worth using
These are the reliably effective old-regime deductions for Bangalore salaried employees:
- Section 80C (up to ₹1.5 lakh): ELSS mutual funds, PPF, EPF (employer contribution), home loan principal, life insurance premium, tuition fees
- Section 80D: health insurance premium. ₹25,000 for self/family, ₹50,000 additional for senior citizen parents
- Section 24(b): home loan interest. Up to ₹2 lakh for self-occupied property
- HRA exemption: if you pay rent in Bangalore, claim HRA based on actual rent paid vs salary formula
- Section 80CCD(1B): NPS additional contribution. ₹50,000 over and above 80C limit
- Section 10(14): LTA. Two journeys in a block of 4 years, travel cost within India
- Standard deduction: ₹50,000 (available in both regimes)
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Find a verified tax consultant in BengaluruBangalore-specific note: HRA and rent receipts
Bangalore's rental market means most employees in Koramangala, Indiranagar, Whitefield, or HSR Layout pay significant rent. HRA exemption can be substantial. Calculate it correctly.
If your annual rent exceeds ₹1 lakh, your landlord must provide their PAN for you to claim HRA. Without the landlord's PAN, HRA exemption above ₹1 lakh is denied. Many tenants discover this at filing time. Collect it proactively.
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