As the financial year 2024-25 draws to a close, many taxpayers find themselves scrambling for ways to save on taxes. While experts recommend early tax planning, there are still some smart last-minute strategies to reduce your tax burden and boost your savings.
Lets have a look at seven reliable options to consider:
INVEST IN EQUITY LINKED SAVINGS SCHEME (ELSS)
ELSS funds are a popular choice for tax-saving investments, offering exemptions of up to Rs 1.5 lakh under Section 80C of the Income Tax Act.
With a minimum investment of just Rs 500 and a three-year lock-in period, ELSS provides an excellent blend of tax benefits and potential financial growth.
NATIONAL PENSION SYSTEM (NPS)
The NPS not only secures your retirement but also provides tax savings. Contributions are eligible for deductions up to Rs 50,000 under Section 80CCD (1B), in addition to Rs 1.5 lakh under Section 80C.
This makes NPS a dual-benefit scheme for wealth accumulation and future pension security.
PUBLIC PROVIDENT FUND (PPF)
PPF offers a winning combination of tax benefits and risk-free returns.
Contributions qualify for deductions under Section 80C, and both interest earned and maturity proceeds are tax-free, making it a favorite for long-term savers.
UNIT LINKED INSURANCE PLANS (ULIPS)
ULIPs offer the triple advantage of life insurance, investment returns, and tax benefits.
With a five-year lock-in period, investments in ULIPs are tax-free, and premiums paid qualify for deductions under Section 80C.
TAX SAVER FIXED DEPOSITS
Tax Saver FDs come with a five-year lock-in period and provide tax exemptions up to Rs 1.5 lakh under Section 80C.
While early withdrawals are restricted, they remain a low-risk option for conservative investors.
SENIOR CITIZEN SAVINGS SCHEME (SCSS)
For senior citizens, SCSS is a lucrative option with an annual interest rate of 8.2%.
Investments up to Rs 30 lakh are eligible for tax deductions under Section 80C, ensuring both security and returns.
SUKANYA SAMRIDDHI YOJANA
Schemes like Sukanya Samriddhi Yojana allow tax deductions up to Rs 1.5 lakh under Section 80C, with tax-free returns.
Accounts can be opened for girls under 10 years, encouraging financial security for daughters.
Tax-saving investments help you save money and secure your future. Pick options that match your goals and act quickly to make the most of the time left for a tax-efficient year-end.
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