Tax saving technique: Income tax return (ITR) filing is mandatory for all taxpayers. It comprises all the details about the annual income and tax liability of an individual. The government gives tax rebates and exemptions under sections of the income tax act 1961. Every taxpayer applies numerous tactics to save taxes, here are four expert-recommended tax-saving methods that you can use in the Financial year 2023-24.
Invest in tax-saving Schemes
Under article 80c of the income tax act, some small saving schemes are exempted from income tax. To save tax, you can invest in these schemes.
Open a Public Provident Fund (PPF) account and invest for the future with tax-saving benefits
if you work in the organised sector then invest in the Employees’ Provident Fund (EPF)
Equity Linked Savings Schemes (ELSS) are one of the best tax-saving options
National Pension System (NPS) gives tax-saving benefits with pension benefits
These are some more small saving schemes that you can opt for as a tax saving investment scheme
Senior Citizen Savings Scheme (SCSS), Sukanya Samriddhi Yojana (SSY), Fixed Deposits (FDs) with a 5-year lock-in period.
Selects Tax regime wisely
As a new tax regime was introduced in the budget 2023-24, Indian citizens now have two types of tax regimes to choose from. The brand new tax regime would not allow you to claim HRA and other deduction benefits but it allows you to claim a full tax rebate if you earn up to 7 lacs in a year. So, You need to evaluate the tax-saving scenario with these two regimes and then choose an appropriate one for you.
Buy a health insurance plan
Purchasing health insurance comes with double benefits, first, it is essential for every individual in today’s scenario and second, it gives you tax-saving benefits. As per law, a taxpayer can claim up to Rs 25,000 for paying health insurance premiums. Section 80D of the income tax act empowers you to claim a deduction spent for health insurance. Senior citizens can claim up to 50 thousand.
Avail of benefits of tax saving with a home loan
Every taxpayer is eligible to claim the deductions related to interest and principal money of a home loan. If you have taken any home loan then as per law you can claim up to 1.5 lacs deduction as per IT act 80c.
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