Tax payers can claim deductions of up of Rs 1,50,000under section 80C of the income tax act. Some of the best options to save tax under section 80C are:

Life insurance - deductions can be claimed under section 80c for premiums paid on life insurance, including those for unit linked insurance plans. Even if your insurance plan covers your spouse or children, you can still claim tax benefits for the premiums paid (provided you have paid the premiums).

Public provident fund - deposits in ppf are eligible for tax deduction under section 80c. Earlier the deduction limit was set at Rs 1,00,000, which increased to Rs 1,50,000 in FY 2014-15.

Senior citizens savings scheme - this is a long-term investment option introduced by the indian government. This is exclusively meant for citizens above the age of 60.

Equity linked savings scheme - the amount invested in an equity linked savings scheme is eligible for tax exemption under section 80C. Elss is a kind of diversified equity mutual fund that comes with a lock in period of 3 years.