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Tax Saving Schemes

Under Section 80 (c) of Indian Income Tax Act, investments made upto Rs. 1.50 lakh in a Financial Year in the following schemes are eligible to save tax. Investors can opt for a combination of these schemes but the overall limit eligible to save (reduce) tax is Rs. 1.50 lakh only. Further, these tax-saving options are available only to those who prefer Old Tax Regime.

We offer investment arrangement and services pertaining to ELSS only under sec. 80 (c).

ELSS: Equity Linked Savings Scheme (ELSS) is an Equity Mutual Fund scheme approved by Income Tax Dept. for tax-savings purpose. The investment can be made as a lumpsum or through SIP (Systematic Investment) during the Financial Year.
There is a lock-in period of 3 years. This is the lowest lock-in period when compared to the lock-in periods applicable to all other schemes eligible for tax-saving.
Generally, ELSS investment generates much higher returns (albeit subjected to volatility due to market movements) vis-a-vis the returns from other investments under sec 80(c).
Public Provident Fund (PPF): This a/c can be opened with banks or Post Offices. This is a Govt. scheme. The initial tenure of the scheme is 15 years. Renewal of the PPF account after 15 years can be made for every 5 years. The interest credited annually to the PPF a/c is Tax-free. NRIs are not eligible to invest in PPF.
Sukanya Samriddhi Yojna: This is also a Govt. scheme where a parent can invest upto a maximum of Rs. 1.50 lakh in each Financial Year in the names of one girl child or two girl children. The total limit permissible is Rs. 1.50 lakh only (for a single girl child or both girl children). Annual interest credited to the SSY a/c is tax-free. At the time of opening the SSY a/c, the age of the girl child should not exceed 10 years. The SSY a/c will mature for payment when the child completes 21 years of age.

*NRIs are not eligible to invest in SSY.

National Pension Scheme (NPS): Under this scheme investment upto Rs. 1.50 lakh is eligible for tax-saving under sec 80 CCD (1). Additionally, upto Rs. 50,000/- can be invested under Sec 80CCD(1B) for tax-saving. Employer’s contribution to NPS for any employee upto 10% of salary is also eligible under Sec 80 CCD (2) for tax-saving, additionally. The maturity date of NPS a/c will be the date of completion of 60 years of age of the a/c holder. Commutation and annuity payments will be as per the NPS rules.
NRIs are permitted to invest under Sec 80 CCD (1) and Sec. 80 CCD(1B) as mentioned above.
National Savings Certificate (NSC): This is another scheme of Govt. NSCs are issued by Post Offices, with a tenure of 5 years. The half yearly interest which is credited to the NSC a/c is taxable.
NRIs are not eligible to invest in NSCs.
Post Office Time Deposits: The Fixed Deposits with Post Offices, with lock-in period of 5 years are eligible under sec 80 (c).
This option is not available to NRIs.
Bank Fixed Deposits: Bank Fixed Deposits with lock-in period of 5 years are eligible under Sec 80 (c). NRIs are also eligible to invest.
NRIs are also eligible to invest.
Senior Citizens Saving Scheme (SCSS): The deduction under Sec 80(c) is available upto Rs. 1.50 lakh in the year of investment in SCSS. This Scheme has an initial tenure of 5 years and can be renewed for 3 years. Multiple renewals are permitted.
This scheme is not available to NRIs.
Life Insurance Premium: Premiums paid upto Rs. 1.50 lakh in the Financial Year are eligible to save tax.
NRIs are also eligible.
Principal amt. repaid under Home loan: A deduction upto Rs. 1.50 lakh can be claimed as deduction under Sec 80 (c) under this option.
NRIs are also eligible.
Tuition Fees: paid by parents for a maximum of 2 children can be claimed as deduction under Sec 80 (c), upto a maximum of Rs. 1.50 lakh.
NRIs are not eligible.
The overall limit under Sec 80(c) is Rs. 1.50 lakh only even if more than one of the above options are chosen. However, contributions to NPS under Sec. 80 CCD (1B) and Sec 80 CCD (2) will be permitted additionally to save tax.
Tax-Saving can also be made additionally under Sec. 80 (D) – premium paid for Health Insurance, Sec. 80 (G) – eligible Donations etc. etc.

For more information, feel free to contact us.

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CIN: U67100PN2022PTC207801, GSTIN: 27AAPCM3781J1ZU, Inception Date: 18/02/2002, ARN: 228676,  ARN Validity: 21/03/2028

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