All Tax Savings Options – Summary

 

Tax Saving Tips
Tax Saving Tips

It is the time of the year when you are waiting for your employer/HR  to provide you with the Form 16 so that you can file your income tax returns. Some of you are waiting for your Bonuses/Incentives with waited breath. We all work really hard for our money and it ought to be invested  judiciously.

Having made quite a few mistaken of mine in the past, I decided to learn from my money-mistakes .It is ,however, best to plan for next year’s income tax planning plus investments right from the month of April (The beginning for FY).For example, If you start an SIP in an ELSS Mutual Fund in April,  not only you can avail of  recommended SIP route to MF investment but also make the most of maximum limit under section Section 80 C.

I shall soon publish a separate post on what section 80 C entails and how you can master it like a pro.

Also refer:  http://www.oracleinvestor.com/personal-finance/what-is-ppf-account/

A somewhat exhaustive list of all the options available for you to park your funds to save tax under different sections of Income Tax Act is given below:

All TAX savings options
All TAX savings options

 

Product Returns(/year) Latest Update Maturity/Lock IN Period Miscellaneous Web
ELSS MF Between 15 to 20% /year (past 4 years) FY(15-16) was a failure for all MFs including ELSS Funds. 3 Years Respective MF Houses’ site/AMC’s site
ULIP between 9 to 10% ULIPs lost money in FY 15-16 5 years Respective Insurance co’s site
NPS 9.5%- 12% Check respective scheme name website 5 years 1 Lakh maximum amount under section 80 CCE from taxable income for self, From employer 10% of salary over and above under 80 CCE http://www.npstrust.org.in/index.php
PPF 8.1% (16-17)  Interest rate was reduced to 8.1% from 8.7% 15 years Respective Banks’ websites
SCS Scheme(senior citizens) 8.60% Age criteria: 60 years or more 5 years Tax free if interest earned/year is less than 10000 http://www.indiapost.gov.in/scss.aspx
Sukanya Smridhi Yojana 8.60% Interest rate: 8.6% (FY-16-17) When the  girl child turns 21 http://www.indiapost.gov.in/SukanyaSamriddhi.aspx
 Bank Tax saving FDs 7.5-8.5% Checl respective bank’s site 5 years Interest is not tax free. Respective Banks’ websites
NSC (India Post) 8-8.5% Interest rate: 8.10 % 5 to 10 Years Investment up to INR 1,00,000/- per annum qualifies for IT Rebate under section 80C of Income Tax Act. http://www.indiapost.gov.in/NSC.aspx
Pension Plans(section 80 ccc) 6-10% Total investment under section 😯 C and 80 CCC cannot exceed 150000/- Respective Insurance co’s site
RGESS Scheme 5 to – 14% Max amount eligible for tax benefit: 50000/- 3 Years Exclusively for first time investors with annual income below 12 lakhs http://rgess.com/
Insurance Policies 5 to 6% Under section 80 C premium paid are tax exempt Do not invest to save tax blindly . Do need analysis first Respective Insurance co’s site
Infra Bonds(80 CCF) Max amount 20000 eligible for 80 CCF deduction 10-15 Yerars period issuer’s website
Nabard Bonds 7.29%-7.64% https://www.nabard.org/english/home.aspx
Tax Free Bonds(section 10) 7.2%- 7.7% ONLY Interest is tax free. NO reduction in taxable income from principle invested 10-15-20 Years Tenor Interest is tax exemept, any capital gains in case of sale of bods in market will be taxed as either STCG/LTCG issuer’s website

Hope you found this useful. Let us know in case of further questions.

Cheers!

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