Tax Saving Hacks for 2024

3 last minute hacks to save tax →

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Today in less than 5 minutes:

1) 3 last-minute hacks to save tax
2) Stock in Spotlight: A company that is expected to grow at a CAGR of 50% for the next 3 years
3) PepsiCo’s renewable energy-powered expansion plans

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3 Last-Minute Tax-Saving Hacks

Just a few more days remain for FY24 to end. If you’ve been careful with your money, then you must have acted on all your tax-saving plans.

Don’t worry if you haven’t though! We have a few tips & tricks to help you save taxes at the last minute. Read on…

📌 Note that the following tax-reduction methods would be most helpful if you are opting for the Old Tax Regime.

1) Reduce your taxable income by ₹1.5 lakh with 80C

Section 80C of the Income Tax Act allows investments up to ₹1,50,000 in certain areas to be claimed as a deduction in taxable income. This is because it’s an investment made into funds that help the government carry out its activities.

Some of the investments available for 80C deduction are:
- Provident Fund (Public, Employee, and Voluntary)
- Equity Linked Savings Scheme (ELSS)
- National Savings Certificate (NSC)
- Unit Linked Insurance Plans (ULIPS)
- Post Office Deposits and Fixed Deposits
- Savings Schemes like SCSS or Sukanya Samriddhi
- Infrastructure, NABARD Rural Bonds

Our favourite is ELSS, since it has the potential for higher returns with a lesser lock-in period relative to other instruments. Learn to choose the right mutual fund with our How to Pick the Right Mutual Fund course.

 📎 An additional deduction for investment upto ₹50,000 in NPS is available 80CCD(1B), over and above the 80C deduction limit.

2) Sell your losses!

Another great way to reduce your taxable income is by realizing your losses. Losses made in business or certain assets can be offset against gains in certain areas to reduce your taxable income. Some can be carried forward to subsequent assessment years too!

Here’s what can be set off against what 👇🏼

Set off of losses

📎 There is an exemption of ₹1,00,000 available on long term capital gains from equity instruments as well. So, you can spread your redemption over years to prolong reaching the ₹1,00,000 profit mark within a year!

3) Get medical insurance

Finally, in a financial year, you can claim a tax deduction of ₹25,000 on health insurance premiums paid for yourself, your spouse, and your parents each. The limit increases to ₹50,000 per year if the insurance premium is for senior citizens aged 60 and above.

So if you buy insurance for yourself, your family, and parents aged >60, a deduction of up to ₹1,00,000 can be claimed in a financial year.

Note that this deduction is available over & above the 80C limit of ₹1.5 lakhs 🤩

It is prudent to select a policy strictly according to your requirements, and not just to save tax. Learn to analyze & pick the right insurance policy in our Fundamentals of Insurance course.

Calculate Your Tax (Cheatsheet)

As we promised, here is a table that not only provides an overview of various methods to reduce your taxes but also assists you in calculating your total taxable income and the corresponding tax amount 👇🏼

Tax Calculation Table

If you want to know how much of a deduction can be claimed under each heading, and to learn to plan your taxes effectively for the next financial year, check out CA Twinkle Jain’s Fundamentals of Taxation Course. Use STOCK10 for a 10% discount & get the course for just ₹359.

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