Last-minute income tax saving options: As the financial year 2023-24 is about to end, individual taxpayers need to make investments before March to claim the benefit in the Income Tax Return (ITR)
Last-minute income tax saving options: Effective income tax savings can be achieved by strategically utilising various avenues, provided they are planned meticulously. If you’re intending to make tax-saving investments, it’s crucial to initially determine the required investment amount. Consider avenues such as the Employees’ Provident Fund, life insurance premiums, tuition fees, home loan principal repayments, etc., as these qualify for deductions of up to ₹1.5 lakh under Section 80C. Income tax allows exemption and deduction of certain investments made during the year. As the financial year 2023-24 is about to end, individual taxpayers need to make investments before March to claim the benefit in the Income Tax Return (ITR).
“When time is limited, tasks may appear daunting, but there’s still a way forward. Evaluate your existing tax-saving expenses that come under 80C, such as insurance premiums, children’s tuition fees, EPF contributions, and home loan repayment. Subtract this total from ₹1.5 lakh to determine the remaining amount to be invested for tax-saving purposes u/s 80C,” said Abhishek Soni, CEO and Co-founder of Tax2win.
People opting for the old tax regime can invest in LIC/PPF/ Fixed deposit/Tax saver mutual fund etc. in case the limit of 1,50,000/- is not exhausted u/s 80C, said Hitesh Jain, Associate Partner, Direct Taxes, N.A. Shah Associates.
ELSS funds, PPF, NPS, and fixed deposits are some of the popular options under section 80C.
Abhishek Soni said that if your existing expenses cover the entire ₹1.5 lakh limit u/s 80C, you don’t need to invest additional funds for tax savings u/s 80C. But if you are still pending with the limit, use investments that fall under Section 80C/80CCC/80CCD.
Further, taxpayers can invest up to to 50,000 in NPS (Tier 1) and claim deduction u/s 80CCD(1B) which is over and above the deduction of ₹1.5 lakh allowable under section 80C, said Hitesh Jain
Deduction under section 80D can be claimed by paying a medical insurance premium or paying for health check-ups of family and parents (subject to a limit of 5,000
Hitesh Jain advised that taxpayers who wish to do charity may donate to eligible charitable organisation before 31.03.2024 and claim deduction available (subject to limit) u/s 80G of the Act.
However one needs to note that the new tax regime has done away with the deduction available under the Old Tax Regime.
Source: https://www.livemint.com/money/personal-finance/opted-for-old-tax-regime-nps-to-bank-fd-explore-the-last-minute-income-tax-saving-options-for-taxpayers-11708576369881.html
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