Last-Minute Tax Saving Tips Before The Financial Year Ends
While saving tax is great, don’t invest blindly, think long-term.
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It’s that time of the year again, March is here, and if you haven’t sorted out your taxes yet, don’t panic. You’re not alone. Between weekend plans, office deadlines, and that ever-growing ‘watch later’ list on Netflix, tax planning might have taken a backseat. But the financial year is about to wrap up, and if you don’t act now, you could end up paying more in taxes than necessary. So, let’s talk about last-minute tax-saving strategies.
Max out your 80C deductions
Before anything else, start by understanding your tax slab as per the latest Union Budget. Section 80C of the Income Tax Act allows you to claim deductions of up to ₹1.5 lakh. In the new Bill, these deductions will be categorized under Section (or Clause) 123. If you haven’t made the most of it yet, now is the time. Consider topping up your PPF, checking if your EPF contributions are maxed out, or investing in an NPS, which offers an additional ₹50,000 deduction under Section 80CCD(1B). Tax-saving FDs, ELSS mutual funds, and life insurance premiums also qualify. If you’re open to some risk, ELSS funds can offer better returns compared to fixed-income instruments.
Health & home loan benefits
Under Section 80D, you can claim up to ₹25,000 for health insurance premiums for yourself and your family, and an additional ₹50,000 if you’re paying for senior citizen parents. Even if you’re young and healthy, a health policy is a smart financial move.
If you have a home loan, the interest component of your EMIs is deductible under Section 24(b) (up to ₹2 lakh), while the principal repayment qualifies under 80C. That means if you’re already paying EMIs, you’re automatically saving on taxes.
Some other smart deductions
Donations to registered charities qualify for deductions under Section 80G, so if you’ve been meaning to give back, now’s a good time.
Moreover, if you’re living in a rented apartment, check if your HRA is optimized or claim rent deduction under Section 80GG.
Repaying an education loan? The interest paid is deductible under Section 80E with no upper limit.
Last-minute tax planning isn’t ideal, but it’s better than missing out. While saving tax is great, don’t invest blindly, think long-term. Maybe set a reminder for June to plan ahead next year? Till then, act fast, make the most of deductions, and keep more of your hard-earned money in your pocket!