5 Tax-Saving Techniques for FY 2022-23 (Photo Credit: Social Media)
New Delhi:
Are you looking for ways to save taxes for this or the upcoming fiscal year? It is important to be aware of the various tax-saving techniques to ensure that you are making the most out of your income. Here, we will discuss five tax-saving techniques that you can utilize for FY 2022-23.
1. Calculate your taxable income The foremost step in tax saving is to calculate your taxable income. This means that you should be aware of the various tax deductions and exemptions available to you and plan your finances accordingly. You should also be mindful of the applicable tax rate as the tax that you need to pay changes with your income. By computing your taxable income, you can lower your overall tax liability.
2. Utilize Tax Deductions The second step to saving tax is to utilize the tax deductions available to you. Various tax deductions are available for different categories, such as medical expenses, home loan interest, donations, etc. It is important to understand the deductions available for each category and to make the most of it. For example, If you have purchased a health insurance plan for yourself, your family, or your parents, the premiums are eligible for deductions you can save up to Rs. 75000 on your income tax.
3. Make Use of Tax Exemptions Tax exemptions are also a great way to save taxes. Tax exemptions refer to income that is not taxable, such as interest earned on certain bonds or life insurance policy premiums. Understanding the exemptions available to you is essential in order to make the most of them and reduce your tax liability.
4. Invest in Tax-Saving Funds Tax-saving (ELSS) funds are another great way to save taxes. These funds are designed to encourage savings and are eligible for tax deductions. Investing in these funds can help you save on your taxes up to Rs 1,50,000.
5. Use an Income Tax Calculator Finally, you should use an income tax calculator to calculate your tax liability. A good income tax calculator can help you understand your tax liability and also provide suggestions on how to reduce it. You can also use this calculator to understand the tax deductions and exemptions available to you and make the most of them. This is one of the easiest methods to calculate income tax with ease. By utilizing these five tax-saving techniques, you can ensure that you are making the most of your income and also reducing your tax liability. Remember to plan your taxable income, utilize tax deductions and exemptions, invest in tax-saving funds, and use an income tax calculator to calculate your tax liability. By following these techniques, you can be sure that you are making the most out of your income and reducing your tax burden.
