Desperately looking for a solution to avoid tax

Tax planning 468 views 6 replies

Prajith Karumathil

6 Points Joined October 2015

Hi,

I work for a private firm and my total annual income (with out any deduction or excemption) is 8.32 Lacs.

Below is my 'Projected Annual Tax Information'

* Annual Income in below Table is after considering all exemption.

So the total tax payable is 39,540/-Year after considering all excemption.

Below are my current investment details

1. 63, 200 = 53,000(LIC)+ 10,200 (Payroll) in 80C

2.19,780 in 80D

So my questions are below

1) How can I legally avoid paying above tax projected?

2) I know I'm eligible for an investment of another 86,800 (1,50,000 - 63, 200) as per 80C. Can anyone suggest me the best investment options available here?

I'm paying almost 36,000 as income tax since last 3 years.So desperately looking for a solution :-(

Replies (6)

Buy a house at a place of your choice. Interest upto 2Lakhs (if self occupied will be deducted from income). if you let out a flat then there is no limit for interest. pricipal will be taken in 80C. instead of Insurance I would suggest PPF where interest is tax free and investment can be taken under 80C

Akash Agrawal

Student CA Final

41 Points Joined September 2012

I suggest you to opt for kisan vikas patra....also invest some amount in tax free mutual funds..some in ppf......make your own portfolio of investments....but please invest in mutual funds..by following the above yoy will not required to pay much tax as well as the yeild from your investments would be enough to meet all your financial needs

Prajith Karumathil

6 Points Joined October 2015

Thanks....But how much more I need to invest inorder to avoid tax?

Vishal Jain

Practising CS

38 Points Joined September 2010

Dear Prajith, I guess your planning to minimise your tax liability it's a Tax Planning. Tax Avoidance is a whole different concept which may land you and the professionals suggesting ways, in trouble. This is w.r.t your question 1. Coming to the question 2, Please provide detailed information about a. the place of residence, type of residence, any assistance from the employer. b. Where abouts about your family, No. Of dependents etc. c. Your pattern of savings, and your nature as to risk taking. You may also if required feel free to reach me with the above answers at Jainvishaal @ gmail.com. or 9021252143. Thanks, Vishal

Prajith Karumathil

6 Points Joined October 2015

I've no idea how the tax is calculated.Can anyone please advice me how much more I need to invest inorder to avoid tax currently?

Miss Rinkal

Student

1309 Points Joined January 2009

Firstly they are not exemptions but deductions. And what you are expecting is tax planning and not tax avoiding

Secondly if you want to minimise your tax burden, you can invest in PPF- where interest on maturity is tax free and investment is eligible for reducing the taxable income.

Also you can invest in NSC and tax saving fds- however interest earned on them is not tax free. They are taxable.

You can also invest in ELSS, the returns are also fairly reasonable and tax free after 3 years.

You can invest up to 1.5 lakhs in 80C deductions.

Also if you are new to shares, you can avail 80CCG deduction by investing in shares.

You can avail a home loan and buy a home, you get interest deduction to the extent of 2 lakhs if it is occupied by yourself. But if it is let out, the income on it will be taxed and interest deduction will not be restricted to 2 lakhs but would be actually payable