Various tax-saving plans are available in the marketplace. This approach allows taxpayers to reduce their taxable income by making investments and thus save on taxes. If you have not used any tax-saving investments yet and looking to a safe and secure process for collecting tax. Then pay some attention to upcoming segments. In this session, we are going to obtain specific details regarding tax-saving investments under 80C and possible ways to make use of this.
Available Options in Tax Saving Investment Under 80C:
Tax saving fixed deposit comes with a period of 5 years and a tax break under Section 80C on investments. The rate of interest will vary in different banks that range from 5.5% to 7.75%. If you are interested in public provident funds, it is a long term investment backed by the government of India. You can also invest in the national pension system, which is applicable for working professionals to have a pension after retirement. Once you decided to invest your money in tax saving schemes, read their terms and conditions carefully before making a final decision.
Even though there is plenty of tax savings plan which is available in the market so that people can be getting confused while choosing for the best. With the help of upcoming tax plans, you can able to select the best among them, and they are as follows,
Investing in Equity-Linked Savings Scheme mutual fund
It is one of the mutual fund schemes which is having two features. The first one is that it is eligible for tax exemption to the maximum limit of one and a half lakhs under section 80c. The second thing will be having a lock-in period of three years. And it offers an interest rate of 15 to 18 percent. Investors can be opting for the growth or dividend option in this fund scheme according to their requirements. But know about the fact that in order to avoid the risk and to gain the long-term returns, you need to invest in more than one ELSS plan.
Investing in the National Pension Scheme
As the best tax-saving investments, NPS helps the people to provide the tax exemption under three cases. You will be able to contribute up to one and a half lakhs. One can get the deduction up to fifty thousand rupees. If the employer contributes ten percent of the basic salary of an individual, then that amount will not be taxed.
Investing in Unit Linked Insurance Plan
It is considered to be one of the tax-saving investment plans which not only offers the tax exemption. But also providing the people high return on investment. The new ULIP launching by most of the insurance companies will be coming with the zero premium allocation charges as well as administrative charges. This plan comes with a lock-in period of five years, and therefore it will be offering the ease of investment as well.
Also, Check – KMB Savings Account Opening with 6% Interest
Investing in Public Provident Fund
It is one of the popular long-term investment schemes. It is having the feature of an investment plan in order to help the people to create financial support after their retirement. In case of the effect of income tax, this plan enjoys an EEE status. It means that, if you are contributing to this plan, the interest, as well as the maturity, are all exempted.
Investing in SukanyaSamriddhiYojana
It is one of the small deposit schemes, which is primarily for the girl child. This plan is currently offering an interest rate of 8.1 percent, and you can expect the benefit of tax exemption as well. You can have made an investment over one and a half lakhs. The withdrawal amount and maturity will be tax exempted.
Investing in the National Savings Certificate
It is one of the fixed income tax savings. You can able to open your account with post-office. It will be ensuring secure investment as the government will initiate this plan. It is designed to encourage the mid-income investors, and they can be able to gain the benefit of the taxability of the income. It is similar to other savings plans in which you can contribute a maximum of one and a half lakhs.
Must Check – PNB Saving Account
Investing in Insurance
As we all know about the life insurance plan. It is one of the tax-saving investment plans which is available in the market. But it is not advisable to invest in this plan with the only motive of reducing the tax alone. The main reason for this scheme will be providing insurance coverage. You will be able to get the benefit of insurance coverage along with the taxability of income under 80c. So without hesitation, make a plan to invest in tax-saving investments and gain the benefits of having it.
Smriti Jain is the owner and senior content publisher at Financesmarti. Financesmarti is a website where she shares a lot of useful stuff for the people and business of India. This includes small business ideas and other banking information, as well. Smriti completed her education in science & technology from Delhi University. Smriti usually has interests in digital marketing now, and she has chosen this career for the full-time opportunity. The primary purpose of starting this blog to provide quality information on the banking industry to the people.