Tax Saving Emailer

For generations, individuals have been drumming up tactics to cut down on taxes. Rings a bell? Of course! All of us are concerned about saving taxes.

Ever wondered why distributors and brokers panic during the March month-end? Because they want to push high-cost and low-yielding products to anxious taxpayers, who have not yet completed their tax planning. Their idea is to push products that bring very little to the table, but at the same time, offer generous commissions to the seller.

It doesn't matter if you're a salaried individual, a freelancer, a business owner or you earn income from your investments, paying taxes to the government is inevitable.

Well, aren't you reading to find out how to save tax?

Alright, let's dive straight in and look at some legal ways to save tax in India.

Here is a list of Tax-saving options

Section	Investments	Exemption Limits
80c	Investing in PPF, PF, NPS, ELSS, etc.	1,50,000
80CCD	NPS investments	50,000
80D	Investing in Medical Insurance for Self or Parents	25,000/50,000
80E	Interest in Education Loan	Full Amount
80EEA	Interest on Home Loan	1,50,000
80EE	Interest on Home Loan	50,000
80EEB	Interest on Electric Vehicle Loan	1,50,000
Section 24	Interest Paid on the Home Loan	2,00,000
10(13A)	House Rent Allowance (HRA)	As per the Salary Structure

Section 80C The purpose of Section 80C is to encourage savings and investments by exempting from tax for any interest paid or credited on money borrowed for lending to a person in India. One can also opt for Deduction at Source for an amount equal to 10% of the total interest payable under Section 8 of the Income Tax Act 1961.

Here are a few investment options under 80C

	Unit Linked Insurance Plan (ULIP)
	Sukanya Samriddhi Yojana (SSY)
	Senior Citizen Saving Scheme (SCSS)
	Public Provident Fund (PPF)
	National Savings Certificate
	National Pension System (NPS)
	ELSS Funds
	5-year Bank Fixed Deposit

Let’s understand the above-mentioned schemes in detail:

ELSS

Equity Linked Savings Scheme is a type of Mutual Fund with a lock-in period of 3 years. ELSS is the only category of MF in India that qualifies for a tax deduction under Section 80C.

Investment:Lump sum or SIP

PPF

This is one of the most common income tax saving scheme available at most banks and post offices in India. The interest on PPF is tax-free.

Tenure: 15 years

Investment:Invest as little as Rs. 500 or maximum of Rs. 1.5 lakh in a financial year

NSC

National Savings Certificate provides is an income tax saving scheme with a fixed rate of interest of 7.7% per annum. The interest received is considered a tax-saving option, and up to Rs. 1.5 lakh can be taken as a rebate under section 80C.

Tenure: 5 years

SCSS

Senior Citizen Savings Scheme is a government-backed long-term income tax saving option. Can be availed by those above 60. Under this scheme, one can get a tax deduction of up to Rs. 1.5 lakh.

Tenure: 5 years

SSY

Sukanya Samriddhi Yojana is for parents with a girl child below 10 years. One is eligible for tax deduction under Section 80C of up to Rs. 1.5 lakhs for the investments made towards this scheme. Interest earned under this scheme is tax-free.

Tenure: 21 years or until the girl gets married after turning 18.

EPF

Employee Provident Fund is a retirement benefits scheme for Salaried employees. Under the EPF act, the employer deducts 12% of the basic salary and Dearness Allowance. The amount is deposited in government-recognized provident fund schemes. In this tax-saving scheme, the deduction is counted towards the Rs. 1.5 lakh limit under Section 80C.

Understanding the above-mentioned allowances and exemptions is the first step while planning your finances and saving taxes.

Also, do make a note that gold is taxed at a higher rate, so it’s wise not to purchase gold as an investment that can generate income.

You can save money by using your deductions correctly and claiming them on your tax returns. For instance, if you paid for your child’s education, you must claim this as a tax deduction. Similarly, under Section 54-54F, you can claim the Capital gain exemption for capital gains. Also, if you have made specific charity to notified institutions or funds, they can be deducted under Section 80G.

On a closing note, if you are aware of your rights and schemes, you can certainly save a lot of tax. Taking advantage of all the options available could save you a lot for your retirement. Talking about retirement, we have news for you! Our Ai-powered investment products like All Rounder and Algrow can certainly make your retirement easy. Do check them out!

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Disclaimer and Company’s Information

Innovage Investment Advisers Private Limited

Registered address: A 703/704, Eureka Towers, Mind Space, Malad (West), Mumbai - 400064. SEBI registered Investment Adviser having registration no. INA 000003809 (Valid from 13th Nov 2015 - Perpetual). Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL and certification from National Institute of Securities Markets (NISM) in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

For detailed disclaimer visit www.5nance.com

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