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Tax-Free Investments 2025: Even in the New Tax Regime, where most deductions are removed, some investments and incomes remain completely tax-exempt under Section 10 of the Income Tax Act. These schemes continue to offer tax-free returns, ensuring financial security while helping taxpayers save money in the long run.

Let’s understand which investments remain tax-free and under which sections.

✅ 1. PPF – Public Provident Fund (Section 10(11))

• Interest and maturity amount are fully tax-free.

• Backed by government guarantee.

• Great for long-term savings – you can earn up to ₹22 lakh tax-free in 15 years.

✅ 2. Sukanya Samriddhi Yojana (Section 10(15))

• Specifically for the girl child’s future.

• Interest rate is 8.2%, and maturity proceeds are 100% tax-free.

• A secure option for parents planning ahead for their daughter’s education or marriage.

✅ 3. EPF – Employee Provident Fund (Section 10(12))

• Tax-free if withdrawn after 5 years of continuous service.

• Contributions over ₹2.5 lakh/year attract tax on interest.

• Helps salaried employees accumulate a retirement corpus.

✅ 4. LIC Policy Maturity (Section 10(10D))

• Tax-free maturity if the premium is ≤10% of the sum assured.

• The policy must be active for 5+ years.

• Ideal for long-term protection and tax-free returns.

✅ 5. NPS – National Pension System (Partial Tax Exemption)

• 60% lump sum withdrawal at retirement is tax-free.

• The remaining 40% goes into annuity, which is taxable annually.

• Although deductions like 80CCD(1B) are not available in the New Regime, this partial exemption still helps.

✅ 6. Agricultural Income (Section 10(1))

• 100% tax-free, irrespective of the tax regime.

• Includes income from farming, land rent, or agricultural produce sales.

✅ 7. Gratuity (Section 10(10))

• Government employees: Entire gratuity is tax-free.

• Private sector employees: Up to ₹20 lakh tax-free.

• Available under both tax regimes.

✅ 8. NSC – National Savings Certificate

• Principal is tax-free.

• Interest is taxable in both regimes.

• Ideal for safe, fixed returns but not for tax-free income under the New Regime.

📌 Tax Rule Confirmation

These exemptions fall under Section 10 of the Income Tax Act, which defines tax-exempt incomes, not deductions. Hence, these remain valid in both Old and New Tax Regimes.

📊 Comparison Table: Tax-Free Status

🧾 Conclusion

Even though the New Tax Regime doesn’t allow deductions, many tax-free incomes under Section 10 still apply. Use these schemes not just for tax-saving but for strategic financial planning with guaranteed, tax-free growth.

✅ Pro Tip: Combine financial planning with tax knowledge to build wealth smartly.