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Its-Never-Too-Early-to-Start-Thinking-about-Tax-Savings

Tax

Post By Aditya Nair

It’s Never Too Early to Start Thinking about Tax Savings

Tax season is almost here. Although it may be a bit early in the financial year to start thinking about tax savings, OneInsure believes it is never too early to plan to reduce the outgoings of your hard-earned money.

The primary tax-saving avenue for Indians is to make investments that comply with Section 80(C). You can claim a maximum tax deduction of Rs 1.5 lakhs under this Section. Also, it is interesting to note is that this amount doesn’t all have to be in investments alone. For example, if you are repaying the principal amount of a home loan, you are eligible for tax relief under Section 80(C) too.

Let’s briefly look at some of the most popular investments and other payments to save tax under Section 80(C):

Investments:
- Life insurance premium payments
- Unit-linked Insurance Plan (ULIP)
- Public Provident Fund (PPF)
- Employee Provident Fund (EPF)
- National Savings Scheme (NSC)
- Tax-saving Fixed Deposit (FD)
- Equity-linked Savings Scheme (ELSS) Funds
- Sukanya Samriddhi Yojana
- Senior Citizens Savings Scheme (SCSS)
Other payments:
- Home loan repayment of the principal amount
- Kids’ tuition fees

This is an informative article that lists all the deductions under Section 80(C) and contains detailed information about each.

Tax saving is a delicate balancing act that involves smart, affordable investments and long-term vision. You should be careful not to make such a large investment for tax purposes that you then have very little liquidity left. And you should not be looking for new tax-saving avenues every year either.

At OneInsure, we encourage the following points when it comes to tax-saving investments:

Tax-saving avenues have to be legal and have a valid paper trail
Slow and steady tax-saving investments (monthly) are better than lump sum investments
Invest in instruments that give tax exemptions in as many stages as possible; the stages are:
- Investment stage
- Accumulation stage
- Withdrawal stage

So, let’s create a better tomorrow with smart, affordable, tax-saving investments today.

Let’s look at investment plans. These are designed to continue for a long time and allow you to save tax while you get rich slowly and steadily. Here are some categories of investment plans you could consider.

Child Plans

Child plans help you stay ahead of rising costs of education, your child’s marriage expenses, and many other major expenses. Major benefits:

Premiums paidcome with tax benefits under Section 80(C)
Pay-outs you receive from child plans come with tax benefits under Section 10(10D)
Flexibility to choose a premium-payment term that is convenient for you, including monthly
Allpay-outs are guaranteed and not dependent on the performance of markets or investor sentiments
Inbuilt death cover that allows the family to survive and the child to continue with education and fulfill aspirations and dreamseven though you may not be around

Retirement Plans

Retirement plans help you plan and save today so you can have a non-dependent, secure tomorrow with no lack of funds. Investing in retirement plans is one of the most crucial decisions you will take in your earning life. Here are some benefits:

Premiums paidcome with tax benefits under Section 80(C)
Pay-outs you receive from retirement plans come with tax benefits under Section 10(10D)
Flexibility to choose the premium-payment term that is convenient for you, including monthly
Retirement plans are structured in such a way that they ensure continuity of investments
Small savings turn into a huge corpus by the time you retire due to the magic of compounding
Flexibility to choose between lump sumpay-outs, monthly pay-outs, or a combination of both

Don’t delay tax-saving investments until it is too late. Contact OneInsure today in case of queries.

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