Key things to remember during income tax planning for FY 2021-22
July, 16th 2021
Income tax planning for FY 2021-22: First quarter of FY 2021-22 is gone and if you haven't done your income tax planning,, then it's not too late as there is still eight and half month left to do that. According to tax and investment experts, income tax planning for salaried employees is an important financial event and one must take it seriously as a penny saved is penny earned. Experts went on to add that while doing income tax planning, one needs to first exhaust its ₹1.5 lakh annual limit under Section 80C and then an additional ₹50,000 allowed under Section 80 CCD (1B) on one's investment in National Pension System or NPS scheme. However, this is not enough as there are various other aspects like mediclaim benefits, tax efficiency of one's investment, etc. that also needs special attention by the taxpayer.
Speaking on income tax planning for salaried employees Balwant Jain, a Mumbai-based tax and investment expert said, "The taxpayer should first try to exhaust its Section 80C limit of ₹1.5 lakh per annum. After this, he or she should move towards Section 80 CCD (1B) where an additional ₹50,000 annual benefit is given under NPS scheme investments." Jain said that Section 80C includes options like PF deductions, life insurance premium, school fee for children, etc.