Tax saving Tips comes from the experience & practice of Income tax.
I am sharing some of basics of tax saving tips gained from my last 10 years of practice with income tax.
You should have basic knowledge of how income tax works in India.
Income Tax is governed by Income tax act, 1962.
Every year this act changes with the outcome of Budget.
I have summarized the Income Tax saving tips as follows:
- Be updated of changes in Income Tax Act, 1961.
- Be familiar with the latest Income tax slab applicable for you and check that if your income exceeds the minimum amount not chargeable to tax.
- File you income tax return on time to avoid interest & penalty.
- Check in which head, income earned by you falls so that you can claim proper exemption. Suppose if you have sold your house and earned capital gain, you should know that such earning falls in under Capital Gain Head so that you could claim capital gain exemption listed under section 54 to 54G.
- If you have received any lump sum amount, report it to your Chartered Accountant so that proper tax planning could be done.
- Always give correct email ID and telephone number while so that any communication/demand from income tax department could be early entertained
- Regularly login to your income tax online account and check for any communication from income tax office.
- Be aware of advance tax provisions and pay all your advance tax on time to avoid interest &Penalty.
- Choose your investment keeping Income tax deductions in mind like you can save Rs. 1,50,000 under section 80C.
- Be aware of various income tax exemptions and claim them on right time.