Want to save tax in the new year, then follow these 5 easy ways

Tax Saving for FY23: If you want to save tax in the new year 2023, then you have to take care of some important things. All taxpayers are required to file income tax return i.e. ITR every year. ITR contains details of annual income of taxpayers. It also includes tax liability applicable on income, in fact taxpayers are required to deposit tax on income. Income Tax Act 1961 (Income Tax Act-1961Under the sections of ) the government also gives exemption in tax. About which a taxpayer needs to know. Here are 5 suggestions for how to save tax in the new year, through which you can save tax. These are the best 5 ways to take advantage of tax exemption on income.

invest in tax saving scheme

Amount invested is allowed government tax deduction under section 80C of income tax. By investing your savings in these schemes, you can claim tax deduction up to a maximum amount of Rs 1.5 lakh. Taxpayers have got the benefit of tax exemption for investing in these schemes in the calendar year 2022. This scheme can prove to be helpful for you in saving money in the new year as well.

Public Provident Fund (PPF), Employee Provident Fund (EPF), Equity Linked Savings Scheme (ELSS), National Pension System (NPS), Sukanya Samriddhi Yojana (SSY), Senior Citizen Saving Scheme (SCSS) and The benefit of tax deduction is available on Fixed Deposits (FDs) schemes with 5 or more tenures. According to tax experts, by investing your savings in these schemes, you can claim tax exemption as per the applicable condition. Also, with this you can arrange more funds for yourself in the long run.

best tax regime

At present, two types of tax regime are available in the country – old tax regime and new tax regime. You can choose the tax regime as per your convenience. Choose that option out of the two which will give you more tax savings. The tax rate is low in the new tax regime. But taxpayers do not get the benefit of deduction in this. Compared to this, the tax rate in the old tax regime is high and in this taxpayers get the benefit of tax deduction under section 80C of Income Tax.

If you want, you can opt for the new tax regime to spend less on tax. Online income tax calculator can help you in this work. With the help of this calculator, you can easily understand the difference between the new and old tax regime.

Invest in health insurance plan

For tax saving in the new year, you can buy a health insurance plan for yourself and your family. By doing this, you can claim a tax deduction of up to Rs 25,000 thousand for paying the premium for the insurance plan under Section 80D. Senior citizens can claim tax exemption up to 50,000 under Section 80D of the Income Tax Act. When you buy health insurance for your parents, you can save an additional tax of Rs 50,000 by doing so.

Avail tax exemption on home loan

If you have taken a home loan from a bank or a non-banking financial institution, you are eligible to claim tax deductions on your loan interest and loan amount under the rules. Under Section 24 of Income Tax, a maximum tax deduction of Rs 2 lakh is available on home loan interest and under Section 80C, a maximum tax deduction of Rs 1.5 lakh is available on the home loan amount.

File ITR on time

Every year a person or company has to file ITR on 31st July or before the date fixed by the Income Tax Department. Failure to file it may lead to penalty along with conditions.

English News Headline :Five Best Ways For Tax Saving in New Year 2023.