Last-Minute Tax Saving Tips- There is not much time left for the financial year 2024-25 to end. Finance experts advise taxpayers to do tax planning at the beginning of the financial year. But, many taxpayers do not do this and look for investment options to save tax at the end of the year. If you also want to invest somewhere to save tax now, then you have many options. These options not only save tax, but also give great returns.
Tax Saving Tips: By choosing the right investment scheme from the investment schemes like ELSS, PPF, Tax Saver FD and Senior Citizen Savings Scheme as per your needs and financial goals, you can not only save a significant amount of tax but can also grow your money.
By investing in equity-linked savings scheme (ELSS) funds, you can get tax exemption of up to ₹1.5 lakh under Section 80C of the Income Tax Act. With a lock-in period of three years, these funds offer great returns. There is no maximum limit on investment and investing in ELSS can start from ₹500.
National Pension System (NPS) is also a good option to save tax and grow money at the end of the financial year. It not only gives returns but also arranges for pension. If you continue investing till the age of 60, the investor can withdraw a part of the amount and the remaining amount is received as pension. Under section 80CCD (1B), you can be entitled to a tax deduction of Rs 50,000 annually by investing in NPS. This is in addition to the tax exemption of Rs 1,50,000 lakh under 80C.
Unit Linked Insurance Plan (ULIP) provides life insurance, tax savings and better returns to investors. Its lock-in period is 5 years. Investment, returns and withdrawals under ULIP scheme are all tax free. If you continue investing in this scheme for 5 years, you will get the benefit of deduction up to a maximum of Rs 1.5 lakh under 80C.
Senior Citizen Savings Scheme (SCSS) is a great scheme for senior citizens. It gives 8.2% annual interest. Investment in it is eligible for tax exemption under Section 80C. A maximum of Rs 30 lakh can be invested in this scheme.
Tax exemption is available on the premium of term life insurance i.e. term plan under section 80C of the Income Tax Act. Tax exemption can also be availed on renewal premium every year.
Tax saver bank FD with a lock-in period of five years is also a great investment option in terms of tax saving. Investments made in tax saver FD also get a tax exemption of Rs 1.5 lakh under section 80C of the Income Tax Act. Money cannot be withdrawn from bank FD during the lock-in period of five years.
Investment in Public Provident Fund (PPF) is tax exempt under Section 80C. The interest and maturity amount are also tax free. People invest a lot of money in PPF because of the excellent returns and no risk of losing money.
This scheme, started for the future of daughters, also provides tax exemption of up to ₹ 1.5 lakh under section 80C. Also, the returns are also tax free. Under this scheme, an account can be opened for a girl child below 10 years of age.
