How To Make More Tax Saving By Doing Less |
Posted: June 17, 2019 |
Wondering How To Make Your Tax Saving Rock? Read This Now!
Earning money is the basic necessity, as it is going to fulfill other amenities of your life. This is where the role of tax makes an entry into all of our lives, either directly or indirectly. No one can escape from paying tax, be it working professionals or businessmen. Thanks to the digitization that has reduced the hassle of getting entangled in the paper works. There has been a tremendous increase in the financial services in India that comes along with a lot of benefits. So, it is very important to be a part of this taxing system to contribute to the growth of the country.
The main problem arises for those who want to save tax, which you can do by making financial investments. There are many ways via which you can save your tax in legitimate ways. But another point to be taken care of is that you must ensure that you are falling under the taxation category. Or else you would be just wasting your time. As per the current government, those who fall under the salary bracket of five lakh are exempted from paying the tax. While those who are earning more than the said amount falls under the taxpaying category. Below are some of the beneficial tax-saving instruments that can bless you in many ways.
Hold your horses right there…..
• Equity-linked saving scheme It is one of the types of mutual funds that comes under Section 80 C. In this, you can get a tax benefit of up to Rs 1.5 lakh annually. You will be able to get your returns in two different ways such as dividends and growth option. • Open tax-saving FDs In this, you can get a deduction on tax up to Rs. 1.5 lakh under 5-year tax saver FDs. The current rate of interest is 7-8%. One thing to be noted is the interest in these FDs comes under the category of payable tax. • ULIP It is basically referred to as Unit Linked Insurance Plan, in this investors are offered with double benefits such as investment and protection in the same plan. Plus the investment made under this scheme is eligible for tax deduction along with providing an opportunity to multi-fold your money in a wise and smart manner. • PPF (Public Provident fund) The investment made under this scheme comes with a tenure of 15 years which is available in most of the banks and post offices as well in India. Though the rate of interest changes every quarterly, besides this the current rate of interest offered to the customers is 8%. • Long term capital gains from the sale of long term assets In this investment is made on long term capital assets, which is then sold out. It depends entirely on you, whether you want to sell the asset after 3 years or more than it. The gain obtained from this is exempted from tax, • NSC (national saving certificate) The tenure for this is 5 years with a fixed rate of interest which is 8% currently. The interest gained through NSC comes under tax-deduction of 80C limit if no other type of investment is made or using up the Rs. 1.5 lakh limit. • Home loan repayment If you are repaying the principal amount to the bank when it comes under the tax-deductible limit up to an amount of Rs 1.5 lakh. • National Pension System In this also deduction comes under the Section 80CCD up to an amount of Rs 1.5 lakh, towards the contribution of NPS. • Senior citizen saving’s scheme If you are planning to invest in the SCSS, then this is also exempted from paying tax if the amount doesn’t exceed 1.5 lakh rupees. Currently, the rate of interest is 8.7% and also taxable it exceeds rupees 1.5 lakh. The tenure of this scheme is 5 years.
The above-mentioned list contains many other items in addition that can be implemented by you to reduce the burden of tax saving. For example, acquiring medical insurance can be very beneficial for you. If you are a salaried taxpayer, then you can use your leave travel allowances and house rent allowances. Medical bills and gratuity can also be filled to save tax. There are many accounts and finance services in India from which you can benefit in a very interesting way.
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