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rajkotupdates.news : tax saving pf fd and insurance tax relief


Tax-saving is an essential aspect of financial planning for individuals. It helps in reducing the burden of taxes on income and increases the disposable income of individuals. Public Provident Fund (PPF) is one of the most popular tax saving tools. Apart from PPF, fixed deposits (FDs) and insurance also offer tax relief. In this article, we will discuss tax-saving through PPF, FD and insurance and how they can help individuals save tax.

Public Provident Fund (PPF)

PPF is a long term investment option backed by the Government of India. It is a savings scheme that offers tax benefits under section 80C of the Income Tax Act. PPF has a tenure of 15 years and the interest rate is revised every quarter. The current interest rate for PPF is 7.1% p.a.

PPF is an excellent investment option for individuals looking for a safe investment with guaranteed returns.

Investment made in PPF is tax-deductible up to a maximum of Rs. 1.5 lakh under section 80C of the Income Tax Act. The interest earned on the investment and the maturity amount are also tax-free.

Individuals can invest a minimum of Rs. 500 and a maximum of Rs. 1.5 lakh in PPF in a financial year. Investment in PPF can be made in lump sum or in installments. Investments made in PPF are eligible for tax deduction, thereby reducing the tax liability of the investor. The tax-saving advantage of PPF makes it a popular investment option among individuals.

Fixed Deposit (FD)

FD is a popular investment option among individuals. It is a type of investment where individuals deposit a lump sum amount for a fixed period, and the bank pays interest on the deposit. FD also offers tax benefits under section 80C of the Income Tax Act.

The investment made in FD is tax-deductible up to a maximum of Rs. 1.5 lakh under section 80C of the Income Tax Act. The interest earned on FD is taxable, and TDS (Tax Deducted at Source) is applicable if the interest earned on FD exceeds Rs. 40,000 in a financial year.

FD is a safe investment option for individuals looking for guaranteed returns. The tenure of FDs ranges from 7 days to 10 years and the interest rate varies depending on the tenure of the FD. FD is a popular investment option among those looking for tax saving benefits.

Insurance

Insurance is a type of investment that provides financial protection to individuals and their families. It is also a great investment option in terms of tax saving. Life insurance and health insurance are two types of insurance that offer tax benefits.

Life insurance is an investment that provides financial protection to the family of the insured in case of an unfortunate event. Investment made in life insurance is tax-deductible up to a maximum of Rs. 1.5 lakh under section 80C of the Income Tax Act. Maturity amount received from life insurance policy is also tax free.

Health insurance is an investment that provides financial security to individuals and their families in case of medical emergencies.

provides. Investment made in health insurance is tax-deductible up to a maximum of Rs. 25,000 under section 80D of the Income Tax Act. The tax-saving advantage of health insurance makes it a popular investment option among individuals.

conclusion

Tax-saving is an essential aspect of financial planning for individuals. PPF, FD and insurance are popular investment options that offer tax benefits under Section 80C and 80D of the Income Tax Act. PPF and FD are safe investment options that offer guaranteed returns. Insurance provides financial protection to individuals and their families in the event of an unfortunate event.

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