For the financial year 2020-21, the taxpayers have an alternate option to choose. In addition to the existing tax regime there is the new tax regime made available in Budget 2020, that one may opt for. However, in doing so and opting for the new tax regime, the taxpayer will not be able to utilize most of the tax saving options available largely under section 80C and Section 80D of the Income Tax Act, 1961. However, the tax slabs are rationalized, and rates are lower in the new tax regime and hence one needs to find out which of the option suits them. While the new tax regime is bereft of the provisions of tax savings, except for saving tax through NPS under Section 80CCD (2), the old tax regime still allows tax savings through PPF, NSC, ELSS etc under section 80C of the Income Tax Act.
The deductions, available under Section 80C up to Rs 1.5 lakh per annum, include benefits for expenses incurred as well as for investments made. The investment-related tax breaks are largely on specified investments, such as traditional life insurance premium, unit-linked insurance plan (Ulip), Public Provident Fund (PPF), National Savings Certificate (NSC), Senior Citizens’ Savings Scheme (SCSS) and Equity-linked Savings Scheme (ELSS) from mutual funds (MFs) amongst others.
Here are some investment options allowed under existing tax regime using which you can save tax and grow funds to meet your long-term goals well.
Equity-linked savings schemes (ELSS)
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
ASK THE EXPERT
Ques. One of my friends told me that your company provides detailed Retirement plans. I want to know what is the procedure to get my Retirement plan. I will be retiring in March 2025. R.P Gupta, Noida
How to Naturally Reverse Fatty Liver Disease
The liver, located on the upper-right side of the abdomen, is the body’s largest internal organ and plays a critical role in detoxifying the blood and processing nutrients.
Banking sector which has underperformed in the last two years, now offers a favorable risk-reward profile
Do you think the market is overpriced? Is yes, should investors refrain from investing in index schemes at the current valuation?
India will continue to enjoy benefits of a close US relationship and trade will continue to grow
Q1. The US elections are said to be one of the closest till date, what impact will the election of a Republican / Democratic party have on the US economy and how is that going to affect India in the short as well as the long term?
Understanding Momentum Funds
Momentum funds are a type of investment fund that focuses on companies experiencing positive momentum in factors such as earnings, revenue, and stock price movement.
Risks and opportunities associated with Small Caps
Small-caps are a stock-picker’s paradise.
How to navigate your portfolio through bull market a
Indian equities have been in a bull run for the past four years.
Choosing mutual fund schemes depending on your age to achieve life goals
The choice of mutual fund (MF) scheme might be influenced by one’s risk profile or age.
Thematic Fund Or Sectoral Fund, Which Fund Suits You?
A thematic fund is a type of mutual fund that focuses on investing in companies based on specific themes or trends.
Be Kind To Your Kidneys
The kidney is a vital organ in our body which is four inches long and two and a half inches in width.
