Want to reduce the payment of Income Tax? Saving investment schemes
Posted on: 03/Jun/2016 10:04:58 AM
Most of us think and plan quite a lot of saving the payment of Income Tax. There are tax saving income tax schemes - you can invest in any and save considerable IT.
Public Provident Fund (PPF): This is a pretty long-time investment. A maximum of Rs. 1.5 Lakhs can be invested and IT can be saved. Apart from this, there is a tax exemption for the interest earned through PPF and the maturity amount as well.
Equity linked saving scheme: In this investment plan, a maximum amount of Rs. 1.5 Lakhs can be invested for IT exemption in a single financial year. Depending on the performance, there will be IT exemption for the interest earned and the maturity amount.
Fixed Deposits: Fixed deposit is another popular tax saving investment scheme. The interest ratio of fixed deposits made in banks and post offices differ. For a minimum of 5-year investment of Rs. 1.5 Lakhs, income tax exemption is given. However, the interest earned and the maturity amount are taxable.
National Saving Certificate (NSC): National Savings Certificates are released by the Indian Post. This is a 5-year investment plan. It is tax exempted. However, the interest earned is taxable.
Employee welfare fund: A maximum of Rs. 1.5 Lakhs can be saved in this scheme. 12 percent of the employee’s basic pay and another 12 percent from the employer go to this investment. The amount on maturity is non-taxable.
Life Insurance: Life Insurance is the most popular Income Tax saving investment under section 80C. The Income Tax exemption is given for a maximum insurance investment of Rs. 1.5 Lakhs in a single financial year. The amount on maturity or in the event of policy holder’s death is not taxable. Life insurance is multi-beneficial in a person’s life.
ULIP (Unit Linked Insurance Policy): This is a special investment. A maximum investment of Rs. 1.5 Lakhs can be made in a single financial year for IT saving. The premium paid is given in 2 forms – insurance and the investment. The maturity amount is also non-taxable.
National Pension Scheme (NPS): This is an additional tax investment scheme. This is also a long-time investment. As the scheme is is focussed on the retirement life, strict rules and regulations are followed in cases of withdrawal before maturity. A maximum of Income Tax deduction of Rs. 50000/- is given for this investment. If the employer is paying a part of the investment, it is unlimited and tax-free.
Sukanya Samrithi Yojana: This is a saving scheme where parents or guardians invest on behalf of girl children. The parents of a girl child can start this scheme any time. The central government has given due consideration to the future welfare of a 10-year old girl child while introducing this Sukanya Samrithi Yojana or Selvamagal Semippu thittam . A maximum of Rs. 1.5 Lakhs can be invested in this scheme in a single financial year. The maturity amount is non-taxable.
