SOME LAST MINUTE WAYS TO SAVE TAX

Now taxpayers are in a hurry to make tax saving investments before 31March,2015, here are few ways through which you can save tax even at last minute:

1. INVEST IN TAX SAVER DEPOSITS: You can invest in tax saver FD (Fixed Deposits). It is the simplest and most popular way of saving tax. Most of the banks now allow customers to open a tax-saver FD online, but don’t allow online facility for other FDs. You can get its exemption upto Rs1.5lakhs under Section 80C. Interest earned under tax-saver FD is taxable.

2. BUY HEALTH INSURANCE ONLINE: Many companies facilitate purchase of health insurance policies online. The insurance-seekers below the age of 45 without any adverse health history do not need to go through medical tests and hence they can take health policies online. But those over the age of 45 will have to wait till policy is issued post medical tests. You can get its deduction upto Rs15,000 under Section80D and for senior citizens its deduction upto Rs 20,000.

3. BUY ONLINE TERM POLICIES: Online term plans are cheaper than physical term products. Within an hour one can purchase the online term plan. As you are taking term plan online so there is no need to pay commission to the agent. The process is completed with payment of premium, unless you have to undergo medical tests. The premium receipt can be used to claim tax deductions. You can claim its exemption up to Rs 1.5lakhs under Section 80C. The amount received on maturity is also exempt from tax.

4. INVEST IN ELSS: ELSS stands for Equity Linked Savings Scheme. This scheme does not require recurring payments. You can discontinue the payment in subsequent years if you realize the fund does not suit your needs. If you are KYC compliant then you can easily invest online. You have to got to the website that track mutual funds and identify the fund with the help of ratings. Then register on the site and click on the invest online link. Choose the scheme you have identified and choose its direct version and pay. The acknowledgement you receive will serve as proof for claiming Income tax exemption. The exemption is available up to Rs 1.5lakhs under Section 80C. The amount received on maturity of ELSS is also exempt from tax.

5. GO FOR PPF : PPF is Public Provident Fund in which anyone can invest. It has low risk. Some banks provide facilities of opening online PPF account but the application and KYC proof is to be submitted in the branch. You can also transfer funds online through your linked savings bank account.

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