Last-Minute Tax Savings for financial year

Mar 10, 2016 | 4 years ago | Read Time: 2 minutes | By iKnowledge Team

Last-Minute Tax Savings for 2016 – Aegon Life Blog

Time is ticking and the financial year end is just around the corner. All taxpayers are familiar with the end of the year rush when they scramble to submit documents in an attempt to save maximum taxes. By this time, most of you must have already submitted investment proofs to your employers. If you are still wondering about utilizing your full tax limit, there is still hope. Even as the April tax filing deadline approaches, it’s never too late for some last minute tax savings. At this juncture it is crucial to invest only in instruments that are simple and easy to understand. With the deadline looming overhead, it is difficult to do extensive research at the last minute. Here are few tax saving tips to help soothe your anxiety:-

  1. Purchase online Term insurance policies: – Term insurance offers a large cover at a negligible cost. Online term plans such as Aegon iTerm plan and iSpouse are comparatively cheaper than the other plans sold by insurance agents. By purchasing online, you can also avoid using insurance agents, which saves costs. You can purchase an online term plan by visiting the selected life insurer’s website and providing the required information such as personal information, nominee details, and income level etc. Once you purchase the plan the premium receipt will be sufficient to claim tax deductions up to Rs 1.5 lakh under Section 80C.
  1. Invest in ELSS: – ELSS stands for Equity-linked savings scheme. It is a diversified equity mutual fund, where the major portion of the fund is invested in equity shares. The best part of an ELSS is that it does not require recurring payments. You can stop the payment toward it, in the subsequent years, if you realise that the scheme does not go well with your needs. You can claim tax exemptions up to Rs 1.5 lakh by investing in an ELSS. Once you have located the scheme online, choose the direct plan version and pay. This acknowledgement will function as a proof of investment, while you claim for tax deductions.
  1. Opt for PPF and NPS: – The Public Provident Fund is perhaps the safest of all tax saving investments because it is run by the Government of India. Moreover, the interest you earn on it is completely tax-free. PPF is the most appropriate tax saving tool for those with a low risk appetite. A national pension scheme or an NPS is also a great tax saving investment tool. With an NPA you can also take advantage of your employer’s contribution along with your own savings. Besides, NPS will offer an added tax break of up to Rs 50,000 from the next financial year.

Want to know your taxes? Access our easy to use tax calculator, and plan your finances.

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