Tax Saving Tips: If we talk about tax planning, now is the time to invest in tax saving investments. So there are such tried and tested investment options, where you can save tax by investing money.
The new year is starting, with it this is the right time for financial planning. And tax planning is a big part of it. Next year, when you go to file income tax return, you will remember this time when you would have thought that you should have planned to save tax. But no problem, you still have plenty of time to take important investment decisions. If we talk about tax planning, now is the time to invest in tax saving investments. So there are such tried and tested investment options, where you can save tax by investing money.
1.PPF
PPF i.e. Public Provident Fund account is opened for 15 years. Any Indian citizen can invest in this. This account is a better way to make safe investment and big fund in the long term. In this, along with the investment, the funds and interest received on maturity remain tax free.
2. NPS
National Pension Scheme (NPS) is a long term investment plan. By investing in this, you get a huge lump sum fund at retirement age. Also, you get monthly pension based on your annuity amount and its performance. By investing in this you will get three benefits. First, you will accumulate retirement fund for yourself, second benefit is that you will start getting regular income after retirement through annuity and third benefit, you can get additional tax deduction of Rs 50,000 under Section 80 CCD (1B) by investing in this scheme. .
3. Home Loan
If you are planning to buy a house in the new year, then this is a better investment for you. Nowadays, most people take home loan from banks to buy a house or flat. In such a situation, you can avail tax exemption on both the amount taken for home loan and the interest charged on it. You can avail tax exemption on the principal amount of home loan up to Rs 1.5 lakh annually, while under Section 24, you can avail tax exemption on the interest charged on the principal amount up to Rs 2 lakh.
4. Health Insurance
In today’s time, health insurance has become a necessity for everyone. Through health insurance, you can not only provide protection cover to yourself and your family, but can also avail the benefit of deduction under Section 80D on purchasing a health insurance policy. Apart from the deduction of Rs 25,000 on the premium paid for medical insurance for your dependents and your spouse, you can also claim a tax deduction on the premium paid for health insurance for your parents. If your parents are above 60 years of age, there is an upper limit of Rs 50,000, making the total deduction limit Rs 75,000.
5. Term Life Insurance Tax Benefit
Term life insurance is a great way to provide financial security to your family in the event of your untimely death, and it also offers many tax benefits. The death benefit received from a term life insurance policy is tax-free for the beneficiaries. This means that your loved ones will not have to pay any tax on the amount they receive. Additionally, one can also claim tax deductions on the premium paid for term insurance plans. This deduction is available under Section 80C of Income Tax up to a limit of Rs 1.5 lakh. Return of Premium plans also offer the benefit of tax-free return of premium (except GST) if the policyholder survives the policy term.
