Announced in the Budget 2023 speech by Finance Minister Nirmala Sitharaman, the revised new income tax regime doesn’t allow for a majority of the tax deductions and exemptions that are available in the old tax regime.
So the first thing you need to do is to check which tax regime is better for you based on your salary level and need to claim tax exemptions and deductions. In case the old tax regime still works for you, then tax saving investments assume an important role.
Tax Saving Tips 2023: From PPF, ELSS to NPS & ULIPs – top tax saving investments
In this week’s episode of TOI Wallet Talks, Ektha Surana, Tax Expert at Clear (formerly ClearTax) summarises the taxation related changes in popular investment instruments in the last few years.
For example, effective April 2023, an individual will have to pay tax on the maturity amount of life insurance policies (other than ULIPs) in case the aggregate annual premium exceeds Rs 5 lakh.
Also, in case you are looking to invest in Equity Linked Savings Scheme (ELSS), then note that ELSS will have EEE tax status only if you opt for the growth option and ensure that capital gains do not exceed Rs 1 lakh while redeeming.
If the employer’s total contributions to EPF, NPS and the superannuation fund exceed Rs 7.5 lakh, the excess amount will be taxable in the hands of the individual concerned. The interest on excess contribution will also be taxable
Watch the video above to know more about popular tax saving investments and which ones should you opt for – Public Provident Fund (PPF), National Pension System (NPS), ELSS, insurance policies, Sukanya Samriddhi Scheme, Unit Linked Insurance Plans or others.
Also, watch the video to find out the thumb rules for tax-based investment planning to make an informed decision about your investment needs.
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