What is Tax Saving Calculator?
Gone are the days when you need to sit with a bunch receipts and investment papers to calculate painstakingly how much income tax you need to pay annually. Tax saving calculator is a handy tool that helps you compute your taxes in seconds. You just have to enter your income and investment details in respective columns.
Benefits of tax saving calculator?
Aside from giving instant and accurate results, it also makes it easy to plan your investments. You can access this online calculator anywhere and enter different figures to work out how to save maximum on taxes. Since it takes factors like age and potential income growth into account, you can also use it for long-term financial planning.
How can you save tax?
Section 80C of the Income Tax allows tax exemption of up to Rs. 1.5 lakhs per annum (meaning you can save up to Rs. 45,000 on tax per year). Fixed deposits, PPF, ULIP and ELSS are some of the more popular 80C investments, though there are plenty of other options too. Choose schemes based on your financial goals and risk appetite. For instance, FDs and PPF are low-risk investment vehicles with fixed income in the form of interest, while ELSS, though slightly riskier, has always delivered superior returns.
Other long term investments
As mentioned above, PPF, FDs and Sukanya Samriddhi Yojana are long-term investments. Though ELSS comes with the shortest lock-in period compared to others, it is often favored as a wealth-doubling scheme if invested for longer than that.