TAX SAVINGS FOR DIFFERENT TAX SLABS: 2-5 lakh With raising inflation, saving money is getting difficult for the professionals who fit in this income slab. Because of lack of knowledge about different tax-saving options, some professionals commit the mistake of making 80C investments even when it is not necessary. They have to make sure that they deduct HRA and contribution to PF from the taxable income before calculating their tax liability. This gives an assessment of savings they can make under section 80C. The tax savings made by investing in 80C is directly proportional to the tax slab. The maximum amount these professionals can save by making tax saving investments under 80C is Rs. 10,000. Considering the liquidity issues associated with tax saving investments, it is really important that these professionals should prioritise between the goals they want to achieve and tax savings. 6- 10 lakh The professionals in this salary bracket should try to maximize the benefits they receive from tax-saving avenues other than 80C. The maximum tax saving they receive under 80C is Rs. 20,000. Buying a home, especially if both the spouses are liable to tax, is a good option. This gives an additional option to claim the interest rate paid on home loan under section 24B up to a maximum amount of Rs. 1.5 lakh. Above 10 lakh The professionals in this tax bracket can enjoy a tax benefit up to Rs. 30,000 by making the tax saving investments which account for section 80C. The tax-planning strategy of such professionals revolves around making use of tax saving options to cut short their income tax rate from 30-20 per cent or 10 per cent. Taking a home loan if planning to buy a home, can be one of those options.
Posted on: Tue, 18 Mar 2014 07:53:12 +0000
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