TaxSavings
We, at Tax Baniya provide tax consultancy services to individuals as well as companies and family businesses. We have in house tax consultants in Mumbai who will provide complete tax consultancy services and guide you on every aspect of direct and indirect taxation.
Meaning of Income Tax
Income Tax is the taxes that are levied on the income of individuals or organizations. Income tax is the tax levied on individual income from various sources like salaries, investments, interest etc. Corporate tax is the tax paid by companies or firms on the incomes they earn.
Top Tax Saving Instruments in India
Here is a list of some of the best ways to save taxes in India.
A. Under Section 80C – Maximum Limit Rs. 1,50,000
| Particulars | Equity Linked Savings Scheme (ELSS) | Public Provident Fund (PPF) | PF Contribution | Life Insurance | Tax Saver Fixed Deposits | How to reach the Rs.1,50,000 limit without investments? |
| Meaning | ELSS is an equity-oriented tax saving mutual fund investment scheme | PPF is the only financial instrument having an EEE (Exempt Exempt Exempt) tax status, Means Investment, Interest and Redemption is tax free | Its is Provided Fund deducted by Employer from Salary | Life Insurance not only guarantees returns on maturity, but also provides a life coverage for you and your family in times of uncertain life events | Fixed Deposits with any bank for a minimum lock-in period of 5 years is tax exempted | Expenses related to stamp duty and registration charges can be deducted under Section 80C. Your Home Loan principal repayment for this year can be claimed as a deduction. Tuition Fees for Children upto 2 child |
| Lock in Period | 3 years | 15 Years, You could even start taking loans at the beginning of the 3rd year to the end of the 5th year, and withdrawals from the 6th year onwards. | Statutory – No Lock in,
Recognised – Before 5 years withdrawal is taxable | Normally 5 years | 5 years | |
| Return | Returns are relatively higher as compared to Others, Normally 12-18% | Normally 8-9% Interest | Normally 8-9% Interest | Normally 6-9% Interest | Normally 6-8% Interest | |
| Link | Please Click – ELSS | Please Click – Life Insurance |
B. Tax saving options other than 80C: Exhausted Rs 1.5 lakh limit? Here are other investment options you can go for
Health Insurance
Under Section 80D, you can claim tax benefit if you have taken a health insurance policy. Under this section, you can save tax up to Rs 25,000 and Rs 50,000 in case of senior citizens. Under Section 80D you can also include expenses incurred towards preventive health check-ups.
Please Click – Health Insurance
National Pension System (NPS)
Under section 80CCD (1B), NPS offers an additional tax deduction for investment up to Rs 50,000. Tax-saving deduction under NPS is over and above the deduction of Rs 150,000 lakh available under Section 80C of the Income Tax Act.
Please Click – NPS
Interest on education loan
Under Section 80E you can avail tax deduction on the interest paid on an education loan. Taxpayers should keep in mind while filing an income tax return, the deduction under this is allowed only on the interest repayment part, not on the principal amount of the education loan. One of the best parts of this is there is no maximum limit on claiming deduction under 80E, which is also over and above the 80C limit.
House rent allowance
IF HRA Part of Salary Claim HRA With Employer
Else
Under Section 80GG, you can avail tax deduction max upto Rs. 60.000 p.a.
Home Loans
The limit on deduction on home loan interest under Section 24 is Rs 2 lakh against Salary Income .
We Suggest to Go For Tax Saving
- Health Insurance
- Term Insurance
- ELSS IF Limit of Rs. 1,50,000 is left
- Additional Rs. 50,000 in NPS for additional deduction
| Holding Period | Less Than 1 Year | 1-3 Years | More Than 3 Years |
| Types of Funds | |||
| Equity / Balanced | 15% Tax | 10% tax if Gain is More than 1 lac without index benefits | |
| Debt | Slab Rate | Slab Rates | 20% tax on Gain after Indexation Benefits |
| SIP – Each installment is considered as an individual investment, tax will be applicable as per above Table | |||
