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Smart Tax Filing, Investment and Legacy Planning: A Guide for Every Age

Rashmi , Last updated: 08 September 2023  

Filing Taxes Late and Late Fees

If you file your tax return after the due date, it could be considered late filing. You might have to pay a late fee as per Section 234F. However, if you originally filed your return on time (by July 31st) and verified it within 30 days of e-filing, you can still revise it later. The deadline for revising is December 31st, and there's no limit to the number of times you can revise it. You can also update previous returns within 24 months of the relevant assessment year, but only if it results in additional tax payment, not for claiming a tax refund.

Smart Tax Filing, Investment and Legacy Planning: A Guide for Every Age

Offsetting Losses from Options Trading 

If you've incurred a loss of Rs 2.5 lakh in options trading, you can offset this loss against gains from stocks and mutual funds, as long as they are short-term gains. Options trading is treated as a business for tax purposes. If you can't fully offset the loss in one year, you can carry it forward for up to eight financial years. However, you can only offset it against business income.

Investing for Grandchildren's Future 

If you want to invest for your two granddaughters' education and marriages, there are various options available. They already have a PPF account. Some options include recurring deposits, fixed deposits, child plans from insurance companies, Sukanya Samriddhi Yojana, mutual funds, and stocks.


However, most debt investments have lower returns (4-8%) compared to the education inflation (10-15%). Insurance-linked child plans typically provide around 4% returns over a long period. To build a substantial corpus, consider investing in mutual funds or stocks on their behalf. Equity mutual funds have the potential to yield higher returns (12-15%) over the long term, helping your investment grow in line with inflation.

You can also claim deductions under Section 80C and might be eligible for tax exemptions on certain investments. Consult a tax specialist for specific investment tax details.


Tax Liability on Maturity

Regarding tax liability on maturity, it depends on the investment option you choose. You mentioned opting for the new tax regime. Taxation rules vary for different investments, so it's important to consult a tax expert to understand the tax implications of your chosen investments for both you and your grandchildren upon maturity.

The author is a Chartered Accountant with 2 decades of experience into Accounting, Taxation, Auditing, Risk & Compliance, Credit Controls, Due diligence. Currently, the author is the founder and managing partner at RRL Global Services. She can also be reached at rrlglobal@yahoo.com

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