The cap of ₹1.5 lakh leaves too little to choose from Section 80C
The maximum tax savings of up to ₹46,350 under Section 80C basket easily catches everyone’s eye. It is a different thing that this sum is for those at the highest tax bracket and not for those in the lower tax brackets. For taxpayers to optimise their tax liabilities there are several windows to save, invest and spend money and claim the tax rebate. The most popular is the Section 80C limit of ₹1.5 lakh which offers plenty of choices to claim tax rebate. For scores of taxpayers, the choice of instruments available under this section becomes the only savings and investment avenue.
There are at least 14 instruments through which you can claim tax deductions under Section 80C. Some of the instruments that offer this benefit include the EPF, PPF, NSC, payment towards children’s tuition fees, ELSS, NPS, life insurance policy premiums, deposit in the Sukanya Samriddhi Yojana, and many others. That these can be categorised as savings, spending and investing alternatives can help taxpayers proportion their contributions accordingly to maximise their tax gains.
Confusing
It’s a case of problem of plenty when it comes to Section 80C. Not only is there a lot to choose from, the end result of each of the instrument varies with varying lock-in of monies. The shortest lock-in of three years is with the ELSS investments, whereas the longest is the NPS contribution, which can puzzle the smartest minds. It is common for many taxpayers to make the wrong choice of instruments to claim tax benefits under this section, resulting in difficulties with liquidity as well as a meaningful usage of the available tax benefits to their advantage in achieving financial goals.
هذه القصة مأخوذة من طبعة December 2016 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة December 2016 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
Gold ETFs And FoFs
While Indians love to invest in physical gold, even mutual funds offer the option, but in paper format.
PLANNING TO BUY CHILD INSURANCE? THINK TWICE
Child insurance plans combine insurance and investment but often offer low returns due to high costs, making a combination of a term insurance cover and mutual fund a better option for securing your child’s higher education needs
How Do You Define Happiness?
Money does buy happiness, but after a while, the appeal fades. We talk about our relationship with money, but, maybe, it’s time to revisit our relationship with happiness
Avoid Crypto As It Is Highly Volatile
I am 22 years old and have recently started working. I want to invest a small portion of money in cryptocurrency. How should I go about it? Does it require a huge capital investment?
Invest Right, Don't Speculate
The lure of high returns and quick gains from equity tips, cryptocurencies, and equity F&O can be enticing. But remember, return of capital is more important than return on capital
The Wedding & Budget: Is Minimalist Trend The Right Knot For You?
Indian weddings are known for their pomp and grandeur, but minimalist weddings are also in vogue now. Dia Mirza was one such celebrity who went for a minimalist wedding. If you also want to keep things minimal on your big day, here’s how to do it
Here's How To Buy An ETF?
Mutual funds are the preferred choice for retail investors. However, they come at a cost and fund management risk, apart from other risks. A smarter alternative is to invest through ETFs.
How Passive Funds Help Diversify
Passive funds provide a simple way to invest in broad markets as well as in specific themes and sectors, making them ideal for an investor's satellite portfolio
The Rise Of Passive Funds
The popularity of passive funds among retail investors has risen post Covid, and fund houses are out with many variations of ETFs and index funds. Does this category present a new opportunity for investors?
Tax Reforms: What's In Store?
The government is working on reforming the existing Income-tax Act, 1961. The impending reforms have raised many questions in the minds of taxpayers. Will the old regime and deductions be done away with? Will it really simplify your life? What's the need for these reforms? We try to answer these and other questions regarding tax reforms
