How Do U People Save Tax?

[chandannasta 4]

Guys I would like to know how do you people save tax? At my work place form past 4 or 5 months my tax is being deducted as 4200, 4880, and 3200 like that. I have not not claimed for anything as I am a newbie in my office and never knew abt this tax thing as being totally dumb. So would like to know how to save my tax so that I don have to get it deducted any more?

[Nirvana 4]

One way to is apply for a policy like Money Plus from LIC. Depending upon the premium that you pay per year, your tax will be reduced.

[Honest 836]

^^^

@Chandan

Any Life Insurance Policy from any company will do the needful for you. You will save tax, approximately 20% of the premium you paid for life insurance policy before 31st March.

Regards.

[nkmenon55 1]

Guys I would like to know how do you people save tax? At my work place form past 4 or 5 months my tax is being deducted as 4200, 4880, and 3200 like that. I have not not claimed for anything as I am a newbie in my office and never knew abt this tax thing as being totally dumb. So would like to know how to save my tax so that I don have to get it deducted any more?

hai,

this financial year our finance minister increased the limit of income tax. so dont worry about the tax.If you are paying rent, it will be deducted from the statement.

yours nkmenon55/calicut.

[copperco2 24]

Guys I would like to know how do you people save tax? At my work place form past 4 or 5 months my tax is being deducted as 4200, 4880, and 3200 like that. I have not not claimed for anything as I am a newbie in my office and never knew abt this tax thing as being totally dumb. So would like to know how to save my tax so that I don have to get it deducted any more?

The tax that is getting deducted from your salary is the 'tax deducted at source'. it happens everywhere.

to avoid it, you have to invest some amount every year and give a proof of investment of that or at the start of the year, you have to promise to invest a certain amount in insurance policy, govenment bonds or housing loans etc, then the tax deduction will get negligible..

but at the end o the year or at the time of filing of returns you have to submit the proof of actual investment.

i can get you a CA to work out the details for you, as a professional. has an office near bora bazaar, fort.

[amtrag 20]

Hi chandannasta,

There are several ways to save tax.

1. First is by way of making "eligible" investments like NSC, LIC policies, Tax Saving Mutual Funds, Bank FD's of 5yr lock-in period, PPF (Public Provident Fund), VPF (Voluntary PF which means voluntarily increasing your PF deduction from salary) and maybe many more.

The limit for these type of investments is 1 lac total in an year.

2. Another method is to show expenses which are allowed like Fuel & Maint (max 1.5 lacs per year provided you have car in your own name), Medical expenses (Rs.15K per year), LTA which is upto 2X basic salary being allowed twice in 4 years. All these "expense-type" tax savings are allowed only on showing actual bills.

Hope this is more than enough for you for now. Actually its a good time to buy some Tax Saving Mutual funds (having compulsary lock-in of 3yrs).

Altleast plan well from next year onwards i.e April onwards.

Edited March 21, 2008 by amtrag

[chandannasta 4]

Okay, I am planning to show HRA by getting my mom's sig on Reent receipt, how to show medical expenses bill and travelling bill. I am from mumbai, how can I avail that from where?

Hi chandannasta,

There are several ways to save tax.

1. First is by way of making "eligible" investments like NSC, LIC policies, Tax Saving Mutual Funds, Bank FD's of 5yr lock-in period, PPF (Public Provident Fund), VPF (Voluntary PF which means voluntarily increasing your PF deduction from salary) and maybe many more.

The limit for these type of investments is 1 lac total in an year.

2. Another method is to show expenses which are allowed like Fuel & Maint (max 1.5 lacs per year provided you have car in your own name), Medical expenses (Rs.15K per year), LTA which is upto 2X basic salary being allowed twice in 4 years. All these "expense-type" tax savings are allowed only on showing actual bills.

Hope this is more than enough for you for now. Actually its a good time to buy some Tax Saving Mutual funds (having compulsary lock-in of 3yrs).

Altleast plan well from next year onwards i.e April onwards.

[amtrag 20]

Sorry to have missed HRA since am myself living in own house so not incurring any HRA.

For Medical expenses, simply ask for receipts whenever you buy any medicines, doctor's fees and expenses on medical tests. And submit the same as and when asked by your employer.

For LTA also, travel anywhere by rail or air and submit actual tickets after the travel. Taxi bills are allowed only if there is no train or flight connection available. Also, most probably, you would be reqd to take certain min no. of leaves for claiming LTA.

But do ask relevant people responsible for taxes in your company about the exact procedures for availing these tax savings.

[situ1962 21]

Actually there are 3 slabs of taxability.it depends on your salary under which slab you fall.for the current assessment year the rates of tax are first 1 lakh is tax free.next 50 k @ 10%,next 1 lakh @ 20% and for the rest amount the rate is 30%.also there is provision for tax relief on certain deposits which qualify for it under section 80 c of it act.another 10 k may be tax free if you take a health insurance policy and pay that amount as premium.this 1.1 lakh is deducted from the gross salary and then only taxable income is calculated.also if you take a housing loan you can claim deduction of upto 1.5 lakh on interest paid there of. First of all you take a good term insurance policy from any company.it is cheap.next invest a good amount in some good elss tax saving mutual funds.they give very good return in the long run.as you are young and at the start of your carrier,you should invest maximum possible amount in tax saving mutual funds.if you need more advice,let me know'regards

Actually there are 3 slabs of taxability.it depends on your salary under which slab you fall.for the current assessment year the rates of tax are first 1 lakh is tax free.next 50 k @ 10%,next 1 lakh @ 20% and for the rest amount the rate is 30%.also there is provision for tax relief on certain deposits which qualify for it under section 80 c of it act.another 10 k may be tax free if you take a health insurance policy and pay that amount as premium.this 1.1 lakh is deducted from the gross salary and then only taxable income is calculated.also if you take a housing loan you can claim deduction of upto 1.5 lakh on interest paid there of. First of all you take a good term insurance policy from any company.it is cheap.next invest a good amount in some good elss tax saving mutual funds.they give very good return in the long run.as you are young and at the start of your carrier,you should invest maximum possible amount in tax saving mutual funds.if you need more advice,let me know'regards

[chandannasta 4]

My annual income is 2,45,000 or 2,50,000. every 6 mnths it just increases by either 500, 1000 or 1500 not more then that. For tax saving mutual funds I do not have any knowldge abt that. Would like to go for it. If your advice could benefit then I would be grateful to u.

Actually there are 3 slabs of taxability.it depends on your salary under which slab you fall.for the current assessment year the rates of tax are first 1 lakh is tax free.next 50 k @ 10%,next 1 lakh @ 20% and for the rest amount the rate is 30%.also there is provision for tax relief on certain deposits which qualify for it under section 80 c of it act.another 10 k may be tax free if you take a health insurance policy and pay that amount as premium.this 1.1 lakh is deducted from the gross salary and then only taxable income is calculated.also if you take a housing loan you can claim deduction of upto 1.5 lakh on interest paid there of. First of all you take a good term insurance policy from any company.it is cheap.next invest a good amount in some good elss tax saving mutual funds.they give very good return in the long run.as you are young and at the start of your carrier,you should invest maximum possible amount in tax saving mutual funds.if you need more advice,let me know'regards

Actually there are 3 slabs of taxability.it depends on your salary under which slab you fall.for the current assessment year the rates of tax are first 1 lakh is tax free.next 50 k @ 10%,next 1 lakh @ 20% and for the rest amount the rate is 30%.also there is provision for tax relief on certain deposits which qualify for it under section 80 c of it act.another 10 k may be tax free if you take a health insurance policy and pay that amount as premium.this 1.1 lakh is deducted from the gross salary and then only taxable income is calculated.also if you take a housing loan you can claim deduction of upto 1.5 lakh on interest paid there of. First of all you take a good term insurance policy from any company.it is cheap.next invest a good amount in some good elss tax saving mutual funds.they give very good return in the long run.as you are young and at the start of your carrier,you should invest maximum possible amount in tax saving mutual funds.if you need more advice,let me know'regards

[situ1962 21]

If you save 1 lakh in any tax saving scheme than you only have to pay tax on 40000 rupees and it will be only 4000.if you are interested in mutual fund,go for any of sbi magnum taxgain fund,hdfc taxsaver,principal personal taxsaver etc.there are among the best of their category.ask a mutual fund broker.he will do the needful.also in for a term insurance policy like lic ANMOL JEEVAN.you can take a policy of 5 lakh for just around 1.5 k per annum.

[chandannasta 4]

Situ, now see Like I am going to show for next Year my tax saving receipts like 5000 as hra every month, that comes to 60000 right for my home as rent receipts, 2nd thing I want to show medical bills, but I dont know where to get that from, 3rd thing I want to show travelling expenses, that I will ask from any travelling agency of rs 25000. 4thing every month I can save my 1 or 2000 rs every month. So let me know such a scheme where I can invest and it can save my tax and well as I can get some money in return if even after a few years I wont mind as my profit.

If you save 1 lakh in any tax saving scheme than you only have to pay tax on 40000 rupees and it will be only 4000.if you are interested in mutual fund,go for any of sbi magnum taxgain fund,hdfc taxsaver,principal personal taxsaver etc.there are among the best of their category.ask a mutual fund broker.he will do the needful.also in for a term insurance policy like lic ANMOL JEEVAN.you can take a policy of 5 lakh for just around 1.5 k per annum.

[situ1962 21]

In mutual fund there are two modes of investing,one is onetime and the other is monthly.the monthly mode is called SYSTEMATIC INVESTMENT PLAN.private banks also market mutual funds.so in to your bank and ask them.they will help you better.

[chandannasta 4]

In mutual fund there are two modes of investing,one is onetime and the other is monthly.the monthly mode is called SYSTEMATIC INVESTMENT PLAN.private banks also market mutual funds.so in to your bank and ask them.they will help you better.

What is ELSS and SBI tax magnum? From where I can avail that in Mumbai? If I put 2000 rs in ELSS say 24000 every year in ELSS how much shall I get in return & how much tax is going to be saved?

[situ1962 21]

ELSS is equity linked saving scheme.if you save rs 24 k per annum you will save 2400 from tax liability.regarding return,there is no certainty as it is market related.but as you have to remain invested for a minimum period of 3 years,you can safely expect a compounding rate of about 20 percent.thirdly,as i had mentioned earlier ,go to an axis bank branch and they will be very happy to help you.hope this clears your doubt.

[chandannasta 4]

ELSS is equity linked saving scheme.if you save rs 24 k per annum you will save 2400 from tax liability.regarding return,there is no certainty as it is market related.but as you have to remain invested for a minimum period of 3 years,you can safely expect a compounding rate of about 20 percent.thirdly,as i had mentioned earlier ,go to an axis bank branch and they will be very happy to help you.hope this clears your doubt.

I did not understand about 20%. What you mean by compounding rate of about 20%

[situ1962 21]

In case of all tax saving schemes,including ELSS,there is a lock in period of 3 years.so in elss in 3 years you can safely expect 20 to 25 percent,which is higher in comparison to other such schemes.of course there is always the market risk associated with it.you should go to a broker or a bank and talk to them yourself.that way you will get your answers better.hope you understand.

[chandannasta 4]

I just met an ICICI agent, she is my senior's sister in my office. She says to pay 4750 or 4850 for mediclaim per annum. I dont know for how many years she said. But she said that you will get a tax benefit in that mediclaim thing. Another thing she also told me to invest 18000 every year for 20 years and I will get 20 lakhs in return after thatand also tax benfit and 5 lakhs accidental insurance policy. I would like to know the name of both these insurance policies. If you could let me know or the link if I can check it out.

[situ1962 21]

If you take a mediclaim policy from any company you can get deduction of rs 10 thousand premium paid under section 80 D.also you can take an accident policy,which is very cheap.now a days banks are also giving free accident policies to their customers.regarding your question about the names of policies,i don't know them.ask her again.she will explain you better.

[chandannasta 4]

If you take a mediclaim policy from any company you can get deduction of rs 10 thousand premium paid under section 80 D.also you can take an accident policy,which is very cheap.now a days banks are also giving free accident policies to their customers.regarding your question about the names of policies,i don't know them.ask her again.she will explain you better.

Situ yesterday some Icici guy came and explained me that this policy is best for me. I want to confirm if its really good. LIFE STAGE PENSION policy of ICICI invest 18000 for 20 years and you get 60 lakhs in return. Is this true? Please let me know.

[kshah 452]

May be unit linked insurance / pension plan. It has its own risk if related to market. All claims are based on current stock market growth story, which can not be true forever. Read fine prints.

[situ1962 21]

Yes,kshah is right.all these market linked products give very good return in long run.but what the agents tell to lure the clients is not absolutely true.everything is based on part performance.nobody has seen the future.so nobody can predict what will happen after so and so years.but it's true that if you remain invested for a longer period for say 5 years,you will surely get good return,better than any other fixed return instrument.also there is always the market risk associated with it.so be sure about your risk taking ability and then only go for it.

[chandannasta 4]

Situ what are SIPs and does it provide good returns and is it good to invest in SIPs and if yes then minimum how much and maximum how much?

[Greatest 55]

SIP means "systematic investment planning"... these are investments done for a particular period of time either monthly/quaterly.... you give a standing instruction to your MF house/ELSS provider, that they will deduct a certain amount which is fixed by you, from your bank account, and they will invest that amount in the plan you want them to invest.... one thing is simple, all these plans/investments, cannot make someone richer in a matter of months.. you need to wait for a few years when the actual returns could be calculated....

SIPs have minimum and maximum limits, which differ from plan to plan and also differs between various providers of the SIP... you could meet someone from any mutual fund advisor, and he might be able to solve and guide you in your investments keeping in mind your investment objectives...!!

[situ1962 21]

I second greatest.generally all companies have fixed Rs 500 pm for sip.but reliance takes aven 100 rupees for sip.some other companies take 2000 rupees minimum per month.but there is no upper limit.