Top 5 Tax Saving Options India Helps You To Plan Your Tax Investments
It’s a TAX SEASON….We are entering the final quarter of the financial year which gets us worried about the tax investments looming overhead. “Next Year” we do it better and ahead of time is the lame statements that we keep on making year after year. We fret as with less time on hand and no help in guiding where to invest and how much; majority of people fails to make tax investments. There are many tax saving options India available; all you need to do is know where and how much and what’s the right time to do Tax investements.
If given a choice, most of us wouldn’t want to pay tax on the income we earn. But we should because; the tax we pay is an important source of revenue for the government. People try to invest as much money as they can in the various tax saving options India schemes in the final moment.
Honestly saying, saving tax isn’t that difficult as you think. There are many things that you have no idea about and can help you save tax. All you need to do is to claim the tax benefits. Before we proceed further showing you where you can do make your tax investments; we show you some completely legal ways of saving taxes first.
People unknowingly make those expenses which make us eligible for tax benefits but; we fail to claim it as we are not aware of it.
Common Regular Expenses Which Lets You Save A Lot Of Tax
1.Repayment Of Home Loan
If you aren’t aware of it, you’d be glad to know that the first home that you are buying for yourself can help you save a lot of tax. The home loan EMIs can help you reduce the burden of tax furthermore; you can claim the very same under tax benefit. You can benefit on both interest components of the installments as well as principal amount. All these tax deductions are covered under Section 24, Section 80 EE, and Section 80C.
2.Deduction On Rent Paid
No worrying even if you are not getting your HRA in your salary, you are still eligible for the tax benefit under the provisions of section 80GG of I-T Act.
3.Medical Insurance & Health Checkup
Medical expenses are a regular part of a person’s life. You’d be glad to hear that the tax laws allow you make some tax gains if you spend any money towards medical insurance as well as preventive health check-up. A person is eligible to get the deduction up to Rs. 60,000 under section 80D of the I-T Act. However; ensure that you do not pay the premiums in cash.
Folks in India spend considerable amount of their income in providing top class education to the kids. Under I-T laws ; it gives you an opportunity to compensate the tution fee expenses by reducing taxes. Parents can claim this tution fee expenses under 80C of I-T Act.
The reason why majority of the rich people you see making donations is because they get exempt. By making donation you are not doing a good work and blessings but; earning the right to claim another tax exemption under section 80GGA. There is also an upper limit mentioned on the cash donations. Such donations are capped at Rs. 2,000.
6.Treatments On specified Diseases
Treatment of diseases like cancer and AIDS is very expensive hence; for these kind of diseases Income Tax Department offers tax benefits to the individual under section 80DDB. The tax benefit offers much needed financial relief to the person suffering from such ailment as well his/her family members.
7.Medical Expenses Of Disabled Dependent
If you are having a dependent person in your family suffering from certain disability; you can avail tax benefit under section 80DD. This deduction is offered as a help to take care of the disabled person who is dependent on you. It can help you save up to Rs 1,25,000 from your net taxable income.
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Tax Saving Options India
Employees Provident Fund
Majority of the companies offer opening EPF account for their employees. If your employer has opened an EPF account; then you are already planning the tax investment which is one of the lucrative tax saving options India offering to save a substantial amount.
The contributed amount under your EPF or PF account can be claimed under the section 80C. The interest income & maturity amount that you get as a result is also exemptable from the tax.
Voluntary Provident Fund
It is said that 12% of your basic salary goes as a mandatory investment in your EPF. However; you can choose to invest more of your basic salary + DA under VPF tax saving options India. In case you choose to invest more, your Employee Provident Fund automatically becomes your VPF.
VPF earns you tax-free interest of 8.4%. Therefore; you can increase your contributions in VPF to get the most out of your deductions under section 80C.
Public Provident Fund
Apart from than Provident Fund, another tax saving options India available for investment is PPF. It is a great option if you looking for long-term investment opportunity. Just like Provident Fund, the individual can get tax deduction on your contributions while resulting interest income & maturity amount stays exempt from tax.
Sukanya Samriddhi Scheme
This one is arguably one of the best tax saving option India that people prefers investing in. This tax benefit is covered under section 80C. This major tax investment schme offers higher rate of return on investment compared to PF & PPF. However; this tax saving option is only available to parents or the guardians of a girl child.
National Pension System
Perhaps one of the oldes tax savings options offered by postal department of India. It is one of the most highly secured option with zero risk. Your contribution to this scheme makes you eligible for section 80C tax deduction.
5 Year Post Office Deposit Account
You can invest in a 5 year fixed deposit at any of your nearest post office branch in India. These post office deposit account work like any other fixed deposit account but’ they comes with a lock-in period of 5 years. However; it offers double return on investment and tax deduction.
You can start using the above mentioned tax saving investment methods to optimise your tax life. In case you have any confusion and need any guidelines on Tax saving options India you can lets us know clicking below.
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