As the financial year draws to a close on March 31, it’s crucial to finalise your tax-saving strategies. Here are some effective moves to consider:
1. Maximise Section 80C Deductions
Invest up to ₹1.5 lakh in:
- Public Provident Fund (PPF)
- Equity-Linked Savings Scheme (ELSS)
- National Savings Certificate (NSC)
- Five-Year Tax-Saving Fixed Deposits
These investments can significantly reduce your taxable income under Section 80C.
2. Contribute to the National Pension System (NPS)
Beyond the Section 80C limit, you can avail an additional deduction of ₹50,000 under Section 80CCD(1B) by investing in NPS. This not only aids in tax saving but also secures your retirement.
3. Pay Advance Tax
If your tax liability exceeds ₹10,000 after accounting for TDS, ensure you pay the due advance tax by March 31 to avoid interest penalties.
4. File Pending Income Tax Returns
Submit any outstanding returns to avoid penalties and interest. Ensure all financial details are accurate and up-to-date.
5. Link PAN with Aadhaar
The deadline to link your PAN with Aadhaar is March 31. Non-compliance may render your PAN inactive, affecting financial transactions.
6. Verify Tax Deducted at Source (TDS)
Cross-check Form 26AS for TDS accuracy. Report discrepancies to the deductor for correction before filing returns.
7. Submit Form 15G/15H
If eligible, submit these forms to your bank to prevent TDS on interest income. This is essential for individuals below the taxable income threshold.
8. Review Capital Gains and Losses
Offset capital gains with losses to minimise tax liability. Maintain proper documentation for all transactions.
9. Donate to Approved Charities
Contributions to specified charities qualify for deductions under Section 80G. Ensure receipts are collected for claims.
10. Reconcile Advance Tax Payments
Verify that all advance tax payments are accurately reflected in your tax records. Rectify any mismatches promptly.
By addressing these tasks before March 31, you can optimise tax savings and ensure compliance, paving the way for a financially sound year ahead.
