Tax Planning

What are the differences between TAX Planning in the New Regime and the Old Regime?

Tax Planning is a must for any Individual to save tax, As of now there are two Tax regimes in process Old Tax Regime and the New Tax Regime. For the Financial Year 2023-24 new Tax Regime has become the default Tax Regime where no deduction or Tax saving instruments are required to save Tax. In the Old regime, there are many tax-saving products through which an Individual can save their Tax under 80 C which is Rs.1,50,000/- and under 80 D Health Insurance Policy where the upper limit is Rs.50,000/-, HRA, LTC, and more. Following are the Tax Saving products as per the old Tax Saving Regime….

  1. Tax Saving Mutual Funds: It is called ELSS Funds or Equity Linked Saving Scheme where the Investor can get a higher return with three years of locking.

  1. Life Insurance Plan: It is mostly used for Tax Saving Products but its return is a maximum of 7 to 8 % with policy locking of 5 Years.

  1. ULIP: Unit Linked Investment Plan (ULIP) where the amount Investors get Insurance on their Investment and also the Amount Invested in the Equity Market. Here Investors have to pay many charges including life Insurance fees and many more. But the tax benefits are only for 1.5 lac, So investors need tax-saving products to go for Tax planning first. 

  1. Public Provident Fund (PPF) and Employees Provident Fund (EPF): These types of Tax Saving instruments are for salaried people, but here they can get only 7-8% of their annual return and have to wait for 15 years of locking period. 

  1. NPS (National Pension Scheme): This is for anyone (Employee or Self-Employed) who should be a citizen of India. Here they can get a limit of Rs.1.5 lac to save under 80 C limit, Under 80 CCD(1B)  it provides additional tax benefits of Rs.50000/- beyond 80C.

  1. Tax Saving FD: Tax Saving FD is a little different from Normal FD here Investors can get Tax benefits under 80 C for a limit of a maximum of Rs.1.5 lac with a locking period of 5 Years. In Normal FD there are no tax benefits where an investor can park money for 7 days to 10 years. Overall we can say ELSS Tax Saving Mutual Funds is only best as there is a locking period of Three years and the approximate return is more than 12%.

  1. Life Insurance Premium: Life Insurance premium is also eligible for tax savings under 80 C for an upper limit of Rs.1.5 lac. One should suggest going for a Term Insurance Plan only and the rest amount can be invested in Mutual Funds or Tax Saving Funds.

  1. HRA (House Rent Allowance): House Rent Allowance (HRA) can be taken as tax benefits if an Individual stays in a Rented house.  HRA comes under section 10(13A) of the Income Tax Act, 1961. It is also taxpayers should know if they are employees and their Rent is being paid by their employer then they can not get tax benefits.

  1. Leave Travel Concession (LTC): Employees can claim LTC for Tax benefits under Chapter VI A of the Income Tax Act. Some terms and conditions must be considered if they are claiming LTC for Tax benefits. A) They must go on an actual journey. B) Only Domestic travel can be considered. C) Tax Benefits on Actual Travel cost only not other expenses.

  1. Retirement Benefits (Gratuity): If an employee has served for more than and getting retirement benefits a Gratuity can be exempted from Tax up to a limit of 20 lac Earlier it was 10 lac now it has increased to 20 lac as per CBDT notification no1213(E). 

Corporate tax planning:

Corporate Tax planning is required to reduce Tax Liability on Table Income by any corporation, under the rules and regulations of the Indian Income Tax Act. Corporate tax can be charged after the deduction of COGS (Cost of Goods Sold), Administrative Expenses, Marketing Expenses, and Research and Development Expenses.  The corporation has to report regularly and correctly for their short-term and long-term plans. They must have to follow the Tax obligations.

Tax planning and management

Tax Planning can be done for an Individual as well as Non-Individual or Corporate. They have to pay the tax as per the Income Tax Act 1961. Individuals or corporations must do proper tax planning for short-term or long-term purposes. There are many Instruments available where if planned in a timely then tax can be minimized in the long run under LTCG or STCGT. An Individual must do proper Financial Planning and manage their Investment in Tax Saving Products.

Tax Planning Services

Tax Planning Services are done by many Investment advisors, Financial planners, Chartered Accountants, Mutual Funds advisors, etc. One can contact any one of them before doing any Tax Investment, Allneeds Advisory Services Pvt Ltd. is Serving PAN India for Tax Planning Services. Allneeds Advisory Services is situated in Paschim Vihar Delhi-87. If someone in Delhi can search us at get Tax Planning Services Absolutely free.

Mutual Funds are the best products for Tax Planning and Tax saving Instruments for any Individual. Yes, they can search for a Tax Planner Near me. You can connect with any CA or Mutual Funds Distributors or Certified Investment Advisor who can guide you to the best Mutual Funds available for Tax Planning and Tax Saving. Tax Planning can be done in two ways One is your Income Tax Planning which you earn today. As per your Annual Income, you have to pay Tax is called Income Tax Planning, When you are getting a return on Mutual Funds or any other investment instrument then STCGT (Short Term Capital Gain Tax) or LTCGT (Long Term Capital Gain Tax) is implemented. Tax planning can be done for Individuals, HUF (Hindu Undivided Family), Pvt Ltd Companies, etc. Here we are discussing Personal Tax Planning. In Personal Tax Planning, you have to pay Taxes under 80 C and 80 D. Tax planning can be done by any Tax Planning Advisor, Certified Tax Planner, Certified Investment Advisor, Chartered Accountant, etc. You can search for them Tax Planner service provider near me, or Tax Planner near me, or a Certified Investment Advisor near me. These professionals can help you to plan for TAX Saving and Tax Planning. Here an Insurance Planner also advises their Insurance products for Tax Saving, ULIP (Unit Linked Insurance Plan) is also considered as a Tax Planning instrument.