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If your salary has been cut in February and is going to be cut in March also. Now you may also be wondering how to save it or get it back, because your salary has been deducted due to it coming under the income tax net. If you want, you can still take steps to save tax, you have time till March 31.
Actually, under the old tax system, taxpayers can avail tax exemption by providing details of investment. But there is only time till March 31 to avail the benefit of income tax exemption in the financial year 2023-24. Let us know that if your salary has been deducted due to income tax, then what are the options to get it back?
First of all, the employee will have to give his investment information i.e. investment proof and HRA details to the company where he is working. Most companies ask their employees to submit investment proof from the end of January to February. So that after verification it can be handed over to the Income Tax Department.
Chance till 31st March
Most of the people in the country take steps to save tax in the last three months i.e. January, February and March. Most people save taxes in the last week of March. If in your institute also the last date for submission of investment proof was till February, then what option is left now? This question might be coming in your mind that when the last date for investment to save tax is 31st March, then why do companies collect the details so far in advance?
Let us tell you, as per Income Tax rules, if you have submitted the investment certificate for the financial year 2023-24 in the organization where you work, then there is no need to worry. You can avail tax exemption by investing till 31st March. There are very easy methods for this.
Mention investments in ITR till March 31st
According to the rules, if you want to avail income tax exemption for the financial year 2023-24, then you can avail it by investing till March 31 without any worry. Even if you have submitted investment proof and income tax related HRA documents where you work. You can avail the full exemption by investing by March 31 and filing ITR before July 31. In which you can submit all the investment documents including HRA, which is valid under Income Tax rules.
This means that you can be tension free by purchasing life insurance, PPF, NPS and medical insurance till 31st March and can file ITR and claim on the basis of this document till 31st July. Not only this, if your salary has been deducted due to tax in the months of February and March, then that amount will also be refunded as soon as you make the claim. Therefore, consider March 31 as the deadline for this.
How to save tax money?
You can deduct up to Rs 1,50,000 from your taxable income by investing under Section 80C of the Income Tax Act. These include amounts like premium paid for life insurance policies, children's school tuition fees, principal amount paid under PPF, KVP, Sukanya Samriddhi Yojana, NSC home loan.
Additional benefit of Rs 50 thousand on investment in NPS
Apart from this, you can get an additional benefit of Rs 50 thousand by investing in NPS. You can also avail tax exemption by purchasing medical insurance. Tax exemption is also available on investment in National Pension System (NPS) under Section 80C of the Income Tax Act. You can also invest Rs 1.5 lakh annually and an additional Rs 50 thousand under Section 80CCD (1B). By investing in NPS, you can get a total exemption of Rs 2 lakh in income tax.
Income tax cut?
You can also avail tax exemption by investing money in mutual funds. For this you will have to invest in Equity Linked Savings Scheme (ELSS), which is a type of equity fund. In this, tax exemption of up to Rs 1.5 lakh is available under Section 80C of the Income Tax Act. There is no tax on returns/profits up to Rs 1 lakh annually in ELSS. ELSS have the lowest lock-in period of 3 years which is one of the best among all tax saving investment options. Apart from this, you can also save tax by buying tax saving FD and Unit Linked Insurance Plan (ULIP).
health insurance
Under Section 80D of the Income Tax Act, you can claim a deduction of up to Rs 25,000 on payment of health insurance premium for yourself, your spouse and children. At the same time, if you buy health insurance for your parents, you can save an additional amount of Rs 50,000.