10 Best Investment Options To Save Tax
Thursday, 09 January 2014, 01:28 IST
Bangalore: Most often we see people taking wrong decisions over tax saving instruments. The reason is simple—they take decisions at the last moment that to sometimes by the end of a financial year. Always try to do the tax planning in advance as it gives you enough time to understand and evaluate different options that would match your financial situation.
One thing, that you need to keep in mind while choosing these tax saving investments, is that they should be under Section 80C. Benefit of taking investments under Section 80C is that from gross total income certain investments are deductible maximum up to Rs.1 lakh.
1. Public Provident Fund (PPF)
The PPF will be the first choice as a tax saver in 2014 as it scores well on almost all parameters. When Fixed Deposits (FD) compared with PPF, the maturity and tax on the interest earned is exempted in PPF.
PPF investors will be provided with more options like opening new account in a post office branch or a bank, doing self paperwork without any agent’s help, periodicity and quantum of investment, liquidity, withdrawal of money (not beyond 50 percent of balance) after five years and flexibility to take loans. In addition some of the banks will also provide online investments. The PPF can be useful for risk-averse investors, self-employed professionals and those who are not covered by the Employees Provident Fund and other retrial benefits.
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