At present, middle-class working women are worried about tax cuts from their salary, but now they do not have to worry because there are some ways through which they can save their tax.
Option of tax deduction under insurance:
Although insurance is a security tool, it has never been the primary means to save tax. But still it provides the benefit of tax exemption under Section 80C and 10 (10D) under Life Insurance and 80D in Health Insurance.
Nowadays new generations of ULIPs are most preferred investment option among the youth. ULIPs also provide tax exemption under Section 80C and a low cost investment product with almost no premium allocation fees and policy administration fees. IRDAI has set the ceiling of fund management fee to be 1.35 percent, so the rate is between 1 to 1.35 percent in all its products.
In this, a part of your investment goes for life insurance, while the other part is invested in the market to get the maximum benefit. It also has many other features such as free interchange between various funds, exemption from premium on death, income benefit and loyalty addition etc.
Public Provident Fund is one of the most popular and reliable long term investment and tax saving schemes. The rate of interest on PPF is determined by the government and its lock-in period is 15 years, so it provides tax-free benefits to the investor.
80D is one of the most important section that must be taken care of while planning tax saving options for employed women. It provides the facility of deduction of taxable income on payment of health insurance premium up to Rs 25,000 per year. Health insurance is a basic requirement for every person and especially salaried women because paying premiums for health insurance not only gives you insurance cover, but also provides many tax benefits.
Deduction under Section 80C:
PPFA NPSA ULIP Some investment options that you can choose to invest your money. This can save your tax up to Rs 1,50,000 every year. Those women, who want to save for their retirement days, should actively focus on the growth of their investments.
Investing in NPS provides an additional benefit of Rs 50,000 under Section 80 CCD (1B).