Looking for an ideal tax-saving solution? Preeti Kulkarni and Himali Patel prepare a list on ways to optimise the tax breaks on offer
The annual tax-saving season is here again. The months of January, February and March usually see frenzied activity on this front, with salaried employees struggling to file investment declarations ahead of the deadlines. The last date for making tax-saving investments, March 31, is also drawing closer, adding to the anxiety.
However, you can avoid this annual rigmarole and plan tax related investments in a manner that not only enhances your financial planning strategy but also reduces year-end pressure on cash flows. You can achieve your goals by aligning your financials and tax planning roadmaps.
If you have delayed the process, understand the provisions under the Income Tax Act, 1961, that lists tax concessions to individuals before going ahead with tax-saver investments. Read on to learn more about efficient tax-saving.
1 Section 80C: Look before you invest
Instead of blindly squeezing out ₹1.5 lakh from your savings to be locked away in an equity-linked savings scheme (ELSS) or a life insurance policy for three and five years respectively, you should look at other deductions that Section 80C offers. For instance, tuition fee paid as part of children’s school fees is a relatively lesser-known tax benefit, but even fewer tax payers are aware of the change introduced in 2015. “Pre-nursery, play school and nursery fees are also eligible for deduction under Section 80C,” points out Vaibhav Sankla, managing director, H&R Block.
This story is from the February 2018 edition of Outlook Money.
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This story is from the February 2018 edition of Outlook Money.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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