Best Tax saving options
best TAX SAVING OPTIONS

  

The Deadline of Investment Proof Submission is approaching fast and it is time to Submit Investment Proofs to Employer. As days pass by, stress levels peak. It is during this time that we start running behind proof collection for the various investments we made to lessen our tax burden. Many of us feel lost when it comes to submitting what kind of proofs can be submitted to save maximum taxes since acceptability of the same poses as a big question in our mind. The last thing we want to do is avoid paying excess tax than we must be actually paying. You will find answers for every ambiguity of yours in the following paragraphs.

 

Let us look at some documents that you need to make ready to submit as proof towards tax savings.

  • HRA Exemption – Rent Receipt and Landlord Pan number
  • Travel tickets – if you want to claim Leave Travel Allowance (LTA)
  • Home Loan certificate for Claiming Interest Under Section 24 (B) of Interest up to 200000 and Principal Repayment Exemption under 80 C
  • Mutual Fund ELSS Investment Receipts under Section 80 C
  • Telephone Bills – For the complete period under Reimbursement
  • School Fees Receipts – Paid for children’s education Up to 2 Children’s. Particularly the ones covering the Tuition Fees Under Section 80 C
  • NPS receipt Under Section 80 CCD 1(B)- 50,000 Rs.
  • Certificate of Interest paid for Deduction of Higher Education loan No Limit 80 E
  • 80 D Premium Paid Receipts for amounts paid towards Health Insurance Up to 25000 For Self, Spouse and Dependent Children, Another 30000 Rs for Senior Citizen parents.
  • 80 D Receipts of Any Preventive Medical Check Up up to 5000 Rs.
  • Medical Receipts include medicines and consultations under Medical Expenditure
  • 80 DD For Deduction of Rehabilitation of Handicapped Dependent deduction is 75000 up to 40% Disability and up to Rs 1,25,000 Rs for 80% Disability.
  • 80 DDB For Deduction For specific Critical Diseases – Rs -40,000 under 60 Years ,Rs 60,000 For Senior citizens, Very senior Citizen -80,000 Rs
  • Premium Paid Receipts for amounts paid towards Life Insurance Under 80 C having Sum assured of minimum 10 Times.
  • Challan for investments made in PPF Under 80 C
  • Receipts for Donations paid – Ensure such donations are eligible for Tax exemption 80 G

 

Details to be submitted to the Employer to avoid paying excess Tax 

Follow a couple of simple things without forgetting and you are sure to escape from paying excess tax due to job changes within a fiscal year. Some such few things are given below for a clearer understanding.

 

  • When you switch from one Employer to another at any point of time during a fiscal year, ensure that you keep your current employer informed about your complete earnings with the previous Employer.

 

  • It is important that you obtain Form 16 from your previous Employer and submit the same to your current Employer so there is no mismatch in what you file and what is remitted in your TDS account by your Employer(s)

 

  • Do not at any cost misinterpret that non-production of earnings from the previous Employer to your current Employer will help not help you hide the same from the Income Tax Department. Remember, your previous Employer remits deductions made from your monthly salary into your TDS account. This makes the Income Tax Department very much aware of your complete earnings for the fiscal year.

 

  • Submitting your earnings from your previous employer to your current Employer not only helps you gain on tax but also saves you from penalties for payment of less or no TDS

 

Other income apart from Employment

Many among us earn income from avenues outside the purview of our regular Employment also. Rental and Lease Income from property owned by the Income Tax Assessee and interest component earned from Fixed Deposits and other such types of Investments falls under this category. Let us understand key points about submitting Investment Proofs for such earnings made out of regular Employment –

 

  • Declare complete details about the extra income earned during the fiscal year to your Employer

 

  • Your Employer will deduct tax to the appropriate extent for such income declared. This will safeguard you from attracting penalties pertaining to Tax evasion or delayed tax payments. Tax payment by your Employer to your TDS account on a month on month basis will save you from paying advance taxes. This will also save you from paying excess tax and running behind the Income Tax Department for getting refund

 

  • You can pay Advance Tax for the income you earn apart from your Employment every quarter in case you don’t declare returns.

 

  • Short payment of Tax during a quarter may attract 1% interest per passing month depending on the quantum of the same

 

Things to keep in mind – 

  • Tax planning is not an activity related to the month of March but is a year-long process.
  • In case you feel lost during your tax planning process or you want to plan your tax aspect in the perfect manner, get in touch with a qualified Financial Consultant. Financial Consultants will be able to guide you through the Tax process in an end to end manner
  • Avoid hiding any information from the Income Tax Department
  • Avoid paying excess tax by planning well in advance
  • Avoid attracting penalties by not producing appropriate investment details

Submitting all pertinent proof of your investments will help you save a lot of money on your tax front. Remember, a typical good tax planning must actually start at the beginning of the Fiscal year and followed meticulously all through the year will help you without causing last-minute stress and running around.

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