How To Take Full Advantage Of Extra Rs 50K Tax Deduction
AdvertisementThe additional Rs 50,000 deduction given to taxpayers under
Before you start to plan your investments, make sure whether you actually need to invest more. Section 80C is an overcrowded deduction, including more than a dozen instruments. Besides, it has the principal repayment of home loans and tuition fees of up to two children. For many taxpayers, their Section 80C investments may have already exceeded the enhanced deduction of Rs 1.5 lakh.
In the lower income groups, taxpayers may not need to save too much. For example, if a person has a taxable income of Rs 3.5 lakh, he needs to invest only Rs one lakh to reduce his tax liability to nil. Even otherwise, a person earning less than Rs four lakh per annum would find it difficult to invest Rs 50,000 more just to save tax. But many taxpayers are not aware of their actual tax liability and end up investing more.
For many home loan customers, the loan repayment alone can take care of the investments under Section 80C.
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