Tax-saving Infrastructure bonds: If you hold a fixed income, Tax-free Infrastructure bonds are the best option for you to save some taxes. These tax-saving infrastructure bond holders can claim for deduction for investment up to 20.000 under section 80CCF of the income tax act for long term infrastructure bonds. The government has allowed lending by various corporations like IFCI, IDFC, LIC and other non-banking finance companies (NBFCs) to raise money through these bonds. The maturity period of the bond is maximum 10-15 years with minimum of 5 years.

Senior citizen saving scheme: If you are 60, then you can think of investing in Senior Citizens' Savings Scheme while earning a higher return. From this year, senior citizens will get a 9 percent annual interest on deposits. In this scheme you can have multiple accounts but your total investment in SCSS cannot exceed 15 lakh. You cannot withdraw money until one year but there is an option of closing the account after a year. In addition to that there is a deduction of 1.5 percent interest if you close the account between one and two years. Thus, Senior Citizen Saving Scheme investment qualifies for deduction under Section 80C but the interest is taxable.

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