Skip to main content

How can you Save Tax under Section 80C of Income Tax Act

Best SIP Funds Online 

Tax-saving investment made during a particular financial year can be claimed as deduction under Section 80C for that particular financial year only.


A plethora of tax saving solutions present in the financial market can help you save your tax. As an investor, you should only know which solution is best for you to make the investment to save tax and achieve your financial goal successfully.

Every year you can invest Rs 1.5 lakh in any of the tax savings solutions and claim tax benefit under Section 80C of Income Tax Act. If you fall in the 30% tax bracket, which is the highest tax slab, by investing Rs 1.5 lakh you can save tax for up to Rs 46,350 (Inclusive of cess charges.). The tax-saving investment made during a particular financial year can be claimed as a deduction under Section 80C for that particular financial year only.

For example, if you invested Rs 1.5 lakh in lump-sum in January 2018 in any tax-saving funds, the same amount can be claimed for financial year 2017-18. Similarly, if you invest the same amount in April 2018, the amount can be claimed for financial year 2018-19.

Here are seven tax savings solutions which can help you save tax by investing Rs 1.5 lakh and claiming deduction under section 80C of income tax act:

Equity Linked Savings Scheme (ELSS)

Apart from saving taxes, investing in ELSS mutual funds will give you capital appreciation and also help you in fulfilling your desired long-term financial goal. The schemes under ELSS category has the least lock-in period of 3 years only. The returns are market-linked and vary from scheme to scheme. The schemes are also designed as per the asset classes, therefore, an investor once assessing their own risk profile and taking help from a financial adviser should invest in any kind of such schemes.

 Bank Fixed Deposits (Bank FD)

A bank FD taken for a term of 5 years is only eligible for tax saving. Apart from this, banks FD provides safe and guaranteed return. Despite the interest earned is taxable, FDs can serve as a good tax-savings instrument over normal savings account where the interest rates are very low.

Public Provident Fund (PPF)

If you want to accumulate funds for your retirement, PPF serves as one of the best investment avenues. Investing in PPF will give you Exempt-Exempt-Exempt (E-E-E) benefit. This avenue has the highest lock-in period of 15 years among tax saving avenues. It is also one of the safest options for any individual to park their money, as the investment made under PPF account is not seized by any court. The returns are fixed and guaranteed but subject to change on a quarterly basis.

 Life Insurance (LI)

Mainly bought for the purpose of protecting one's family. One can save tax under Section 80C as well as under section 10(10) D where maturity benefits also get exempt from income tax. A product like ULIP help in providing protection and investment growth and can be made particular goals.

National Pension System (NPS)

The instrument is designed to get a lump-sum amount and also, a regular income once you retire. This gives you an additional benefit of doing the investment of Rs 50,000 under section 80CCD (1B) of income tax act. It means any eligible individual can invest up to Rs 2 lakh under his/her NPS account and save tax for up to Rs 61800 (inclusive of cess. charges) in the highest tax bracket. Deferred annuity received during the time of retirement is taxable.

National Savings Certificate (NSC)

Investment in the scheme is eligible for tax deduction. There is no limit to making your investment. Also, the certificate can be kept as collateral security to avail loan from banks.

Senior Citizen Saving Scheme (SCSS)

It one of the best tax saving solution for senior citizens, who have reached age 60. If an employee is taking VRS (Voluntary retirement) then he/she can open their SCSS account even the age 55 provided that the account is opened with a month of the date of receipt to avail retirement benefits. The maturity cycle is 5 years and it can be further extended for a period of 3 years if needed.

InvestmentLock-in PeriodHistorical ReturnsOffers Guaranteed ReturnsTax free Return
ELSS312-16%*NoYes
Bank FD57-9%YesNo
PPF157.80%YesYes
Insurance50-6.5%NoYes
NSC57.80%YesNo
NPS109%NoNo
SCSS58.30%YesNo
*The returns are market linked and not guaranteed.


SIPs are 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

Popular posts from this blog

NPS for Tax Saving

The NPS is a great way to save tax if you don't mind locking in your money till you retire. Till last year, the taxability of the NPS was a big issue. But last year's Budget changed the rules and made 40% of the corpus tax free. The PFRDA wants that the balance 60% to be exempt from tax as well. The emphasis is on increasing pension coverage. So, allowing EEE status (to NPS ) is our major demand (in the Budget NPS is especially useful for investors who may have exhausted the `1.5 lakh investment limit under Section 80C but want to save more.   Another way the NPS can cut tax is by rejigging the salary.If a company deposits up to 10% of the basic salary of an employee in the NPS under Section 80CCD(2d), the amount will be tax free. Turn to page 28 to see how much tax this can save. However, the take-home pay of the employee will come down. Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 10 Tax...
Read more

Retirement planning from a long-term perspective

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds     `HOW green was my valley'. This title comes from a movie I had watched many years ago. A little boy's journey into adulthood and the story of a Welsh valley's turn of-the-century descent from pristine paradise to despoiled coal mining.   I thought of the title because it is comparatively reflective of a person's life ­ the glorious years when he is earning and the sun down years when he is not having his regular job and, hence, his living standards comes down. The reason is a combination of things. Inflation of food items, transport, increase in health related costs in the later years of life and increase in expenses in almost all basic amenities of life. In India, the social security system is almost non-existent. In some states, wherever it is available, the scales of benefits are extremely modest...
Read more

BHIM App

What is BHIM? BHIM stands for Bharat Interface for Money , which is an easy way of transferring money from one bank account to an other via a smartphone using the Unified Payments Interface (UPI) platform . It is an instant payments application meant for sending money as well as requesting for payments. How is it different from UPI? BHIM is no different than UPI. But in the case of BHIM, customers don't have to download mobile applications of multiple banks, instead a single BHIM app downloaded from Android Play Store is sufficient. Other than that, payments can be made through a virtual payments ID or through account number and IFS code, same as UPI. What you need to use BHIM? BHIM can be used across an droid smartphones with version 4.0 and above, also it will be made available on iPhones and Windows smartphones very soon. Further, for feature phone users they need to use the USSD feature by dial ing *99#. Why was the need for BHIM felt when UPI is already in place? With various...
Read more

SBI Long Term Advantage Fund Series

Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 10 Tax Saver Mutual Funds for 2017 - 2018 Best 10 ELSS Mutual Funds to invest in India for 2017 1. DSP BlackRock Tax Saver Fund 2. Invesco India Tax Plan 3. Tata India Tax Savings Fund 4. ICICI Prudential Long Term Equity Fund 5. Birla Sun Life Tax Relief 96 6. Franklin India TaxShield  7. Reliance Tax Saver (ELSS) Fund 8. BNP Paribas Long Term Equity Fund 9. Axis Tax Saver Fund 10. Birla Sun Life Tax Plan Invest in Best Performing 2017 Tax Saver Mutual Funds Online Invest Best Tax Saver Mutual Funds Online Download Top Tax Saver Mutual Funds  Application Forms For further information contact  SaveTaxGetRich on 94 8300 8300 ------------------------------ ------ Leave your comment with mail ID and we will answer them OR You can write to us at Invest [at] SaveTaxGetRich [dot] Com OR Call us on 94 8300 8300  
Read more

BANK FDs for Tax Saving

This is probably the easiest way to save tax if you have a Netbanking account . After the demonetisation and the digital push, almost everyone has one. A few clicks of the mouse and your tax planning is done. However, as mentioned earlier, this convenience comes at a very high cost. Interest rates have come down significantly and are close to 7-7.5% right now. The bigger problem is that the interest is fully taxable. It is added to the income of the investor and taxed at the marginal rate applicable to him. In the highest 30% tax bracket , the post-tax yield is close to 5%. Even so, tax-saving fixed deposits are suitable for risk averse investors, especially senior citizens who might already have hit the ` 15 lakh ceiling in the Senior Citizens' Saving Scheme and don't want to lock in money for the long term in a PPF account . Though NSCs offer higher rates than most banks, many senior citizens prefer to invest in deposits of their own banks, because they get better service ...
Read more
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