Best way to save tax !

Find out which tax saving instrument fulfill your requirements

ELSS FUND Return 9.78% in the past three years 

ELSS Funds are the best way to save tax Though the SIP window has closed for the taxpayers who would have had to show proof of the section 80C is the tax-saving investment by now.                                                                                                                    

ELSS funds have a lock-in of  3 years, the shortest among all tax saving options.

ELSS is the best way to save tax for the young taxpayers they should stagger  their instrument with monthly SAPs

NATIONAL PENSION SCHEME

Return 10.8% for the past 5 years

Charges in investments and the tax rules have the just made that the NPs more attractive firstly the entire 60% of the corpus that can be withdrawn at the time of retirement will now be tax free.

Secondly,  investors can now allocate up to 75% of equities in the active choice option of the NPs.

NPs Can Help

contribution up to 1.5 lakh can be claimed as deduction under section 80C

Additional deductions up to 50000 under section 80CCD (1b)

If your employer put up to 10% of your the basic salary in the NPs that amount not be taxable

PUBLIC PROVIDENT FUND

Interest rate 8% for January-March 2019

PF Rate hiked in October 2018 after a sustained rise in the bond yields through bond yields

Interest is tax free

Small savings schemes at a distinct advantage over the fixed deposits

PPF scores high on safety flexibility and ease of investments

SR CITIZENS SAVING SCHEME

Interest rate 8.7% for the January- March 2019

The (SCSS) was the best tax saving options for those above 60 and by offering seniors and additional 50000 exemption on interest income

Overall tax exemptions for those above 60 in  now 3.5 lakh and above 80 is 5.5 lakh  

The tenure of the SCSS  investment is 5 years

 Investment limit is 15 lakh

SUKANYA SAMRIDDHI YOJANA 

Interest rate 8.7% for January-March 2019

For taxpayers with a daughter below 10 years the Sukanya Samriddhi Yojana is a good way to save

Interest will be 8.5% (could change)

Interest is higher than PPF

Interest is tax free

Minimum investment 1000

Minimum of two daughter

ULIPs

Return 8-14% for past five years

Even before that tax one capital gains was announce ULIPs had a distinct tax advantage

UPLIs offer  equity funds and also liquid funds for investors                                                      

Switching from equity to debt or vice versa does not have any tax implications

launched by insurance companies are low on costs                                                                  

Compete with direct plans of mutual fund on charges                                                               

PENSION PLANS

Return 8-10% for past 5 years

The popularity of the NPs has elapsed pension plans from the insurance firms investors in NPs get an additional deduction of 50000 for contribution under section 80CCD(1b)

More tax can be saved by contributing through the employer 

NSCs
Interest rate 8% for January-March 2019

An interest rate of 8% make National Savings certificates (NSCs) a good options for those who wants to invest in a hurry

Interest deduction under section 80C

BANK FDs

Interest 7.5 - 8.2 5 % current                                                                           
Tax Savings Bank fixed deposits are a good choice for those who may have left their the tax planning for the last minute

Interest rates are not high

INSURANCE

Return  5% for 20 year plan

Traditional policies are not able to offer the insurance cover that a person actually needs 

Parents of them suggest endowment plans to their kids not realizing that these can be a millstone around their kids necks.