Investors who have invested in these investment options need not worry. Experts say that even if you have invested in these investments, you should review them once. The reason for this is that if there is any kind of shortfall in the investment, then investment can be made till March 31 to make up for it. It has to be kept in mind that deduction on these investments is allowed only in the old regime of income tax.

Deduction on investment up to Rs 1.5 lakh under section 80C

In the old regime of income tax, under section 80C of the Income Tax Act, 1961, it is allowed to claim deduction of up to Rs 1.5 lakh in a financial year. About a dozen investment options come under this section. These include PPF, SSY, NPS, ELSS etc. Deduction can be claimed by investing in any one of these schemes or in more than one scheme. But, it has to be kept in mind that whether you invest in one scheme or more than one scheme, you can claim a maximum deduction of up to Rs 1.5 lakh in a financial year.

Deduction on health insurance premium under section 80D

If you have not bought health insurance, you can buy it till 31st March. This will enable you to claim deduction on its premium while filing income tax return for this financial year. If you buy health insurance after 31st March, you will not be able to claim deduction on its premium while filing return for this financial year. A person can buy a health policy for himself and his family and claim a maximum deduction of Rs 25,000 on its premium. If your age is more than 60 years, you can claim a deduction of Rs 50,000. Apart from this, a deduction of Rs 50,000 can also be claimed on buying a separate health policy for elderly parents.

Be sure to keep these things in mind while investing

You have to keep in mind that the purpose of investment should not be just tax-savings. You have to invest keeping in mind your financial goals. If you can take a little risk, then you can invest in the tax scheme of mutual funds. This scheme is also called ELSS. ELSS has the highest return among tax-saving investment options. It has a lock-in period of three years which is the shortest lock-in period among tax-saving investment options. If you cannot take risk, then you can invest in bank tax-savings FD or PPF. But, it has to be kept in mind that while the lock-in period in bank tax-savings FD is 5 years, PPF is a long-term investment. It matures after 15 years.

The post You can invest in PPF, SSY, ELSS, NPS for tax-savings till March 31 first appeared on Rightsofemployees.com.

For your information, let us tell you that no change has been made in the income tax slab in the new bill, nor is any amendment proposed in the capital gains tax. The main objective of this bill is to simplify the language of tax related rules, so that it becomes easier for the common man to understand and implement it.

However, there is a big change that you should be aware of. If you pay tax by choosing the old tax regime, then you will be well aware of the various tax saving options under Section 80C. Investments like Equity-Linked Savings Scheme (ELSS), Public Provident Fund (PPF), life insurance premium, National Pension System (NPS), and tax-saver deposits come under this section. All these options get tax exemption of up to Rs 1.5 lakh.

Provisions of 80C now in 123

There has been a big change regarding 80C in the new bill. All the exemptions available under 80C will now come under section 123. According to this section, “Any individual or Hindu Undivided Family (HUF) will get exemption on the amount paid or deposited in the tax year, which will be equal to the total of the amounts given in Schedule XV, but this exemption will not exceed Rs 1.5 lakh.”

“Section 123 in the new Income Tax Bill is in line with Section 80C of the current Income Tax Act 1961. This should be read along with Schedule XV, which is part of the bill and gives a detailed description of various tax saving options under Section 80C.”

What has changed in the new bill?

This new Income Tax Bill is 622 pages long and contains 536 sections. Whereas, the current Income Tax Act has 298 sections in 823 pages. The new bill has a section on every section of the current Income Tax Act, except those sections which have become irrelevant now.

According to Ajay Rotti, founder of Tax Compass, “The Income Tax Act of 1961 contains sections 80, 80C, 80D, 80E etc. The last section number in the current Income Tax Act is 298. But the new bill has re-numbered the sections, which may increase the number of sections to more than 500. However, overall this bill simplifies the tax laws.”

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The post New Tax Bill: Govt has abolished 80C, now how to get the benefit of Rs 1.5 lakh through ELSS, PPF, NPS? first appeared on Rightsofemployees.com.

However, most taxpayers make use of Section 80C of the Income Tax Act for tax-savings. Under this, there are about a dozen such options, in which tax-savings can be done by investing. These include PPF, NPS, ELSS, Life Insurance Policies etc. But, we are telling you about such ways to save tax, which do not require any kind of investment to take advantage of them.

Tuition fees

Individual taxpayers can claim deduction on tuition fees under section 80C of the Income Tax Act. This facility is not available to HUF. You can claim this deduction on the tuition fees of two children. Tuition fee refers to the total tuition fee to be paid in a financial year.

If you do a job, you have to submit the investment proof to the finance department of your company by the first or second week of January every year. You can take the Tuition Fee Payment Certificate from the school and give it at your office. This will result in good tax-savings for you.

Education scholarship

The scholarship amount received for education is exempt from tax under section 10(16) of the Income Tax Act. Tax experts say that the scholarship received from the government or any trust is exempt from tax.

Contribution to Political Party/Charitable Organizations

If you make any kind of contribution to any political party or charitable organization, then you can claim tax deduction on it. This deduction facility is available under section 80GGC of the Income Tax Act.

Education loan

If a student has taken an education loan, then a deduction can be claimed on the interest amount. This deduction can be claimed under section 80E of Income Tax. You just have to keep in mind that this deduction is available only on the interest part of the EMI. Deduction cannot be claimed on principal.

Rent paid

If you are employed and do not get House Rent Allowance (HRA), you can claim a deduction on the rent you pay. This deduction is available under section 80GG of the Income Tax Act. Self-employed individuals can also claim this deduction. To take advantage of this deduction, it is necessary to submit Form

The post Super Idea to Save Tax: 5 ways you can save tax even without investing first appeared on Rightsofemployees.com.

The government can adopt some different methods to provide relief to the middle class people from inflation. For this, experts are also expressing the hope that these 5 announcements will be made in the budget. Maximum income tax comes from the salaried class only. In such a situation, even if the Finance Minister announces an increase in the tax limit, it will not be surprising. Apart from this, the standard deduction is also expected to increase.

Tax limit will increase

Inflation is increasing day by day. In such a situation, the cost of living is also increasing. In such a situation, the government can give income tax exemption of five lakh rupees to income tax payers under the new tax system. At present, 5% tax has to be paid on income of Rs 2.5 to Rs 5 lakh and 20% tax on income of Rs 5 to 7.5 lakh.

Standard deduction will change

The salaried class can avail exemption of Rs 50,000 under standard deduction every year. It is believed that the government can make changes in section 16 (ia) of income tax. It is expected that the limit of this standard deduction can be increased from Rs 50,000 to Rs 75,000.

Exemption will be available in 80C

Under Section 80C of the Income Tax Act, taxpayers can get tax exemption by investing an amount of Rs 1.5 lakh. Taxpayers have been demanding to increase this limit for a long time. If the government takes a decision on this matter in this budget, then taxpayers are going to get a big relief. This investment can be done in EPF, PPF, ELSS, NSC, NPS, Bank FD.

Invest for retirement

Employed people always invest in retirement plans. In such a situation, the government can increase the limit of tax exemption in this also. Experts are of the opinion that the government can increase this limit to one lakh rupees under section 80CCD (1B) of the Income Tax Act.

Health Insurance

At present, there is a rebate of Rs 25 thousand under the health insurance claim. It is expected that in this budget the government will increase it to 50 thousand rupees and for the elderly it can be increased from 50 thousand to 75 thousand rupees.

The post Standard Deduction Increase: Government will benefit the salaried class in these 5 ways, standard deduction will increase! first appeared on Rightsofemployees.com.

Income Tax Saving: Form-16 has been issued by the companies. The last date for filing ITR has been fixed by the Income Tax Department as July 31. In such a situation, if you are also thinking of paying tax on income of 10 lakh rupees, then you are wrong.

The post Income Tax Big News! Tax of Re 1 will not have to be paid even on earning of 10 lakhs, Know full details first appeared on Rightsofemployees.com.

There are many such schemes in the market to save tax. There are some schemes, where returns are guaranteed, but this return will be in single digits only. At the same time, there are some schemes, where there is some risk as compared to the schemes with guaranteed returns, but the returns can be double or even triple. Among these, Equity Linked Savings Scheme (ELSS) of mutual funds is an option. This can help in creating a bigger corpus for the investors in the long term. Let us have a look at some of the top performing income tax saver funds.

SBI Long Term Equity Fund

20 Year SIP Return: 17.16 percent
Value of 1 Lakh Investment in 20 Years: 43.23 Lakh
6000 Monthly SIP Value in 20 Years: 1.03 Crore
Minimum Investment: Rs 500
Minimum SIP: Rs 500
Total Assets: 9878 Crore (As on 30th June, 2022)
Expense Ratio: 1.77% (up to 31st May, 2022)

ICICI Pru LT Equity Fund

20 Year SIP Return: 17%
Value of 1 Lakh Investment in 20 Years: 40.89 Lakh
6000 Monthly SIP Value in 20 Years: 1.02 Crore
Minimum Investment: Rs 500
Minimum SIP: Rs 500
Total Assets: 9072 Crore (As on 30th June, 2022)
Expense Ratio: 1.91% (up to 31st May, 2022)

HDFC Taxsaver Fund

20 Year SIP Return: 16 percent
Value of 1 Lakh Investment in 20 Years: 37.24 Lakh
6000 Monthly SIP Value in 20 Years: 87.50 Lakh
Minimum Investment: Rs 500
Minimum SIP: Rs 500
Total Assets: 8716 Crore (As on 30th June, 2022)
Expense Ratio: 1.83% (up to 31st May, 2022)

Tata India Tax Savings Fund

20 Year SIP Return: 15.6%
Value of 1 Lakh Investment in 20 Years: 29.18 Lakh
6000 Monthly SIP Value in 20 Years: 85.20 Lakh
Minimum Investment: Rs 500
Minimum SIP: Rs 500
Total Assets: 2743 Crore (up to 30th June, 2022)
Expense Ratio: 1.78% (as of 31st May, 2022)

Benefits of investing in ELSS

AK Nigam, director, BPN Fincap, says that most of the schemes in this category have a lock-in period of 3 years, while the returns are high compared to other tax saving schemes. At least 80 per cent of ELSS exposure is in equities. Because of this, the scope for higher returns increases. This has made it a popular tax saving option. Looking at the returns of ELSS, investors have got 12 to 18 percent returns in many schemes in 5 years. The good thing is that even after the completion of the lock-in period, you can continue investing as long as you want. That is, it also promotes long-term investment, through which financial stability can be found in the future.

One can also opt for Systematic Investment Plan (SIP) in ELSS. The profit on investment in ELSS and the amount received from redemption is completely tax free. Long Term Capital Gains (LTCG) on returns up to Rs 1 lakh in 1 year through ELSS are exempted from income tax. However, profit above this limit is taxed at the rate of 10 percent.

The post Tax Saver Mutual Funds/ELSS: ELSS is a wonderful scheme to save tax, in which those who deposit 200 rupees daily also become millionaires first appeared on Rightsofemployees.com.

Income Tax Saving: Form-16 has been issued by the companies. The last date for filing ITR has been fixed by the Income Tax Department as July 31. In such a situation, if you are also thinking of paying tax on income of 10 lakh rupees, then you are wrong.

The post Income Tax Big News : Tax of Re 1 will not have to be paid even on earning of 10 lakhs, Know full details first appeared on Rightsofemployees.com.