Tax Benefit: The primary goal of tax planning is to prepare a plan to pay minimum tax by combining tax deductions and credits.
Tax Benefit: Tax planning is an important part of your financial planning. While preparing it, it has to be kept in mind that how can you take maximum advantage of tax benefit i.e. tax exemption and what to do so that the tax burden on you is minimized. This process is prepared on the basis of a person’s income, expenses, investments and other transactions that have the potential to save tax.
The primary goal of tax planning is to prepare a plan to pay minimum tax by combining tax deductions and credits. This is an important part of personal finance, whose job is to put minimum tax burden on taxpayers while following the legal limits.
Plan based on the changes made in 2024
While planning tax for the assessment year 2025-26, it is important to keep in mind the changes made in 2024. This will help a lot in tax planning for 2025. Tax loss harvesting is a good tool in this. Under this, securities are sold at a loss so that the capital gains from the rest of the portfolio can be compensated to pay less tax. The impact of the loss can be reduced by the subsequent gains and the continuous tax benefits. By adopting this method, a good profit can be earned in the long run by getting exemption of Rs 1 to 1.25 lakh on capital gains.
Reduce taxable income under section 80
Taxable income can be reduced under section 80C of the Income Tax Act. For this, tax deduction of up to Rs 1.5 lakh can be obtained by investing in PPF, insurance premium, five-year fixed deposit, equity linked saving scheme and unit linked insurance plan. At the same time, by investing under NPS, an additional tax exemption of Rs 50,000 can be obtained.
Under the New Tax Regime, the increase in standard deduction from Rs 50,000 to Rs 75,000 will also benefit the salaried people. If the tax liability is more than Rs 10,000, you can get the benefit by saving penalty etc. even if the advance tax is paid on time.
