Today (March 21) is left for 11 days (March 21) to end the financial year 2024-25. It also means that in this financial year, there are few days left for those who choose the old tax system to save income tax. In such a situation, it is time for you to get into action to save your tax! If you are looking for tax-saving means that provide income tax deduction to reduce your taxable liability, then you can choose some investment options that are capable of saving your tax.
ELSS
Investment in Mutual Fund’s ELSS is eligible for tax deduction. ELSS come with a 3-year lock-in period, and this section also has a risk compared to other investments, as ELSS is associated with the stock market. According to Ujjivan Small Finance Bank, by investing in it, you can claim a tax deduction of up to Rs 1.5 lakh per year under Section 80C of the Income Tax Act from your GDP. To claim these deductions, you have to invest before 31 March.
National pension system (NPS)
The National Pension System is a retirement savings scheme that provides additional tax benefits under Section 80CCD. NPS allows you to create a pension fund. In addition to a limit of ₹ 1.50 lakh of Section 80C on the contribution of up to ₹ 50,000 made in NPS, there is a benefit of tax deduction. This encourages long -term savings for retirement by providing attractive investment options. Market -related returns are available with the possibility of high growth compared to traditional means. If you are self-employed, it can be claimed as a 20% deduction of gross income.
Health and Life Insurance Premium
If you want, you can also save tax by purchasing health insurance or life insurance. Under Section 80D of Income Tax, you can claim deduction on the premium paid for health insurance for your, your spouse, children and parents. According to the current provisions, maximum deduction permission is ₹ 25,000 (or ₹ 50,000 for senior citizens), which promotes health and financial security. Life insurance policies are eligible for deductions under the premium section 80C. However, for tax benefits, ensure that the annual premium is less than 10% of the sum insured.
PPF
PPF i.e. Public Provident Fund is a long -term investment option that provides attractive interest rates and returns on the amount invested. In this, a tax exemption up to Rs 1.5 lakh is given under Section 80C of Income Tax. To get a tax exemption, before March 31, you have to open a PPF account under this scheme and the amount deposited during one year can be claimed to be deducted under Section 80C. Any person wants to invest in PPF can start with a minimum investment of Rs 500. However, the maximum investment amount is Rs 1,50,000 per year.
5 year tax saver FD
Keeping in mind the saving tax, if you want, you can consider for a tax saver FD or post office time deposit in any scheduled bank. However, the minimum investment period in it should be 5 years. Apart from bank FD, the post office also has a time deposit scheme for 5 years in which you can invest money. A tax deduction of up to Rs 1.5 lakh is allowed under Section 80C of the Income Tax Act, 1961, even if the interest earned on the FD amount is taxable.
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