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Save up to ₹3,00,000+ in taxes before March 31, 2024. Tax Planning for the 20s 🧵👇

Taxes are going to be the biggest expense of your lifetime.

It's best to start early & learn about optimising taxes.

Save up to ₹3,00,000+ in taxes before March 31, 2024. Tax Planning for the 20s 🧵👇

[1] Contribution to Provident Fund

Both the employee and employer contribute to EPF/PPF.

🔸Investment amount: Up to ₹1.5 Lakhs
🔸Benefit provided: Tax deduction u/s 80C

You might end up getting a tax free return (subject to limits) of 7.5%-8.5%🤯

That's as good as getting a pre-tax return of 10.7% to 12.15%✅

[2] Invest in National Pension Scheme👇

NPS is 1 product with 3 tax benefits😲

It also provides pensions by way of annuity payments after retirement.

Tax benefits:
🔸Deduction u/s 80CCD(1) - ₹1.5 Lakhs (subject to 80C limit)
🔸Additional deduction u/s 80CCD(1B) - ₹50,000

🔸If you are a corporate employee, claim u/s 80CCD(2) - 10% of (Basic + DA)

[3] Get insured🚑

Investing in good health and life insurance provides loads of benefits. Tax benefits being a major one👇

Tax Benefits:
🔸Term Life Insurance - Section 80C up to ₹150K (overall limit)
🔸Medical Insurance - Section 80D up to ₹25K/50K (depending on conditions)

[4] ELSS Investing

Investment in ELSS funds will help in both investment and tax saving🤯

It provides deduction along with benefits of equity mutual funds (subject to lock-in of 3 years)

🔸Tax Benefits: up to ₹1,50,000 (u/s 80C)

[5] Use House Rent Allowance (HRA) to save tax👇

Only if you are a salaried employee.

Claim a deduction of HRA with lower of the following:
🔸Actual HRA received,
🔸50% (Metro cities) / 40% (Non-metro) of Basic + DA or
🔸Actual rent - 10% of (Basic + DA)

[6] 20s are for education and upskilling!

So if you have an education debt, you can claim deduction of interest paid on those loans u/s 80E✅

🔸Tax Benefits: No limit🤯

Conditions:
🔸Deduction allowed only for 8 years,
🔸Deduction can be claimed by you or your relative.

[7] Regularly file Income Tax Returns📅

Even though you may not be liable for taxes👇

Ensure regular tax filing as it helps in:
🔸Acting as income proof for loans,
🔸Visa clearances,
🔸Refunds,
🔸Buying insurance, etc.

[8] Select the right regime✅

Undertake a thorough analysis of the tax regime most beneficial to you and select accordingly.

This is especially true if you are into a business as you have limited chances to change your regime😲

Refer to this blog on New vs Old regime👇



9] Always seek professional help!

There have been too many cases of
🔸Incomplete returns,
🔸Missing out on refunds,
🔸Reporting wrong incomes, etc.

Always seek professional help for better tax savings and planning✅

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