Skip to main content

Tax Planning: Claiming Income tax benefits

The end of the financial year is here. Tax planning can be a simple exercise for the salaried.

As the financial year comes to an end, it is time for the salaried section to put in place the tax-saving investments. While the remaining two months can be used for making the investments, it gets a lot easier if the employer is provided with all details as it will do away with the task of waiting for refunds. Since most employers expect employees to provide proof of tax saving by the end of January or February, check 5 out if you have completed the tasks.

Rent receipt details

The house rent allowance can turn taxing if employees don't provide details of their rental expenditure. Hence, provide details of rent paid for the past months so that HRA does not become a taxable income.

Details of all tax-saving investments
Signing up for long-term tax-saving instruments like insurance or pension plans is meaningless if the details are not provided for tax relief. While the task of providing details becomes easy when you opt for salary deduction, the trouble comes when you make these investments on an annual or half-yearly basis. When insurance payments are made through ECS, it is still mandatory to provide the receipt or statement to the employer to get the tax relief.

Keep track of changing guidelines

Income tax regulations, as you are aware, are subject to change. Hence, you need to assess the past investments at regular intervals. A classic example is investments in pension plans which were earlier covered under Section 88CCC. Now they have been brought under Section 80C and the upper limit too has been raised to Rs 1 lakh from Rs 10,000.

Similarly, there have been changes on the health insurance front too with additional relief being provided for premium paid on behalf of senior citizen parents.

Reducing burden from LTA


Leave travel allowance is always a tricky component for young professionals. Since the allowance needs to be claimed (some companies do provide without request), it can skip the attention of many professionals. There are a couple of factors associated with LTA. As the name indicates, the allowance is provided to enable the professional to travel on leave once a year to his native place. Hence, the individual is required to provide details of the travel to claim it.

The other part of the allowance is with respect to income tax. The allowance, as per the IT Act, is tax-free once in two years or twice in a block of four years. So, it is important for the salaried segment to keep track of the year while claiming the tax benefit as it need not be taxed alternate years or twice in a block of four years.

During the remaining two years, the allowance is taxable.

Medical reimbursement

Another expenditure which is not taxed from the point of employee is medical expenditure, up to a limit of Rs 15,000 per annum. Some employers do provide the money if not claimed but then it will become an allowance and hence taxable. Instead, employees can reduce the tax burden by claiming the allowance with the help of medical bills on a monthly or annual basis.

Popular posts from this blog

Post Office Deposits Interest Rates

Best SIP Funds to Invest Online   SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich For further information on Top SIP Mutual Funds contact  Save Tax Get Rich on 94 8300 8300 OR You can write to us at Invest [at] SaveTaxGetRich [dot] Com

Tax Slabs 2012

Slab 1 Upto Rs 1.6 Lacs Tax Rate NIL for Men; Upto Rs 1.9 Lacs Tax Rate NIL for Women; Upto Rs 2.4 Lacs Tax Rate NIL for Senior Citizen; Slab 2 Rs 1.6 Lacs to Rs 5 Lacs Tax Rate 10% Slab 3 Rs 5 Lacs to Rs 8 Lacs Tax Rate 20% Slab 4 Rs 8 Lacs onwards Tax Rate 30%   --------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.   Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)   Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications   These Application Forms can be used for buying regular mutual funds also   Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds ) HDFC TaxSaver ICICI Prudential Tax Plan DSP BlackRock Tax Saver Fund Birla Sun Life Tax Relief '96 R

How Tax Deducted at Source (TDS) works?

    THE tax season is here. And if you are an employee you can't blame your employer for deducting large chunks of money from your salary towards tax deducted at source ( TDS ), which he is legally obliged to do. Your bank will also deduct some percentage from your FD interest of Rs 10,000 or more towards TDS! So what is this TDS all about? How is it computed? Are there any changes this year? Read on... What is TDS? TDS reduces your taxable income and could even provide tax relief! The TDS collections account for 40 percent of the total taxes collected in the country. As the name suggests TDS is the amount of tax that is deducted at source in certain types of income . The TDS thus collected is deposited in the Government treasury within a specified time. How is it computed? Some of the types of income where TDS is applicable include salary, interest, rental fee, interest on securities, insurance commission, dividends from shares and UTI/Mutual Funds, commission and brokerage

Modern day balanced mutual fund approach

Buy Gold Mutual Funds Invest Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Call 0 94 8300 8300 (India)   In reality, most balanced funds have a strong tilt towards equity instead of a mix of equity and debt THERE are various types of mutual funds available to investors with specific features. Often investors have a particular idea about a specific type of funds in terms of their features and risks, but that is not what is actually available. Therefore, it is necessary for an investor to understand the actual position before picking up a fund. This requires some work on the part of the investor. One example can be the situation with balanced funds. Name is not representative: One of the first things that an investor has to understand is that the name of the fund is often not representative of its investment pattern. The name often represents only the aim of the fund, and not what it actually is.

ELSS Tax Saver

ELSS Stands for Equity Linked Savings Scheme.   ELSS Fund are mutual funds with 3 years of lock in period and offer income tax benefit under section 80C. They are open ended to purchase. Not all Mutual fund Investments are eligible for tax exception. List of Tax Saving Mutual Funds   Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.   Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)   Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications   These Application Forms can be used for buying regular mutual funds also   Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds ) HDFC TaxSaver ICICI Prudential Tax Plan DSP BlackRock Tax Saver Fund Birla Sun Life Tax Relief '96 Reliance Tax Saver (ELSS) Fund IDF
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now