Tax planning is one of the cornerstones of sound financial growth. The best time to plan for your tax is at the start of the financial year so that you can plan well and fulfil your long term goals with tax saving plans. Also, early tax planning won’t burden you at the end of the financial year. Tax saving should not be done with just a mere intention of saving tax rather it should also give good monetary returns and long term benefits. If you want to save taxes, you can rely on these tax saving plans to give you the maximum tax benefits:-
1.Unit Linked Insurance Plan (ULIPs)
Unit Linked Insurance Plans are versatile financial instruments that offer you the dual benefits of life insurance and market-linked investments. ULIP plans have a lock-in period of 5 years and tenures ranging from 5-30 years. These plans fall under the EEE (exempt-exempt-exempt) tax structure i.e. exempted at investment stage, exempted at accrual and exempted at withdrawal, which makes them an attractive tax-saving avenue. One of the most attractive ULIP benefits is that the premiums paid can be claimed as a deduction under section 80C (life insurance) or 80CCC (pension) up to a maximum of Rs 1,50,000. Moreover, the amount you receive on maturity is exempt from tax under Section 10(10D). You can start investing in unit linked insurance plans on our platform to avail all these benefits.
2.Public Provident Fund (PPF)
PPF or Public Provident Fund is an investment account offered by the Government of India. It can be opened through all major banks and post offices. The PPF has a tenure of 15 years and the interest rate is reviewed every quarter, but on an average it is around 8%. All proceeds received on maturity of the PPF are tax-free. Under PPF you can contribute a minimum of Rs 500 per year and a maximum of Rs 1.5 lakh.
With booming healthcare costs and inflation at the peak, it’s imperative to have health insurance. Besides protecting yourself and your loved ones from unforeseen medical costs, a health insurance policy also offers several tax benefits. With a health insurance plan, you can enjoy tax deductions on the premiums paid up to Rs. 25,000 under the section 80D of the Income Tax Act. For a senior citizen, the tax deductions under health insurance have been increased from Rs 20,000 to 30,000. If you have purchased a family health insurance plan that includes your parents, you will be eligible for a tax deduction of up to Rs. 30,000. You can buy health insurance at Finserv MARKETS to enjoy both tax savings and protection.
4.National Savings Certificate (NSC)
National Savings Certificate or NSC is a savings instrument created by the Government of India to encourage the habit of saving. It has a 5-year tenure and its interest rate is reviewed every quarter but is currently at 8%. The interest received from an NSC investment is also eligible for deduction under Section 80C. For example, if you have invested Rs 1 Lakh in NSC and it pays interest of Rs 8,000, the interest amount will also be tax deductible.
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