Tax saving avenues for person close to retirement

Tax planning 439 views 5 replies

VINAY MAITHANI

Reliability Engineer

36 Points Joined December 2011

Hello Experts,

My father is one year away from retirement and after that He would continue to work in the same company for at-least next 5-6 years OR till his health permits, on advisory role with almost same benefits. He is in good health by grace of god.

He is in 30% tax bracket and has exhausted his 80C limits along with Section 24 interest exemption of home loan for 1st house and 2nd house as well. So now no more real estate investment is also required.

How can he further reduce his tax outgo and grow his money as well with minimum risk ?

Is it advisable for him to go for Debt Funds or Hybrid Debt Aggressive/conservative (to reduce the tax burden on income earned) at this stage of life ?

Otherwise the funds are lying in the savings bank account idle…

Regards

VinManHBK

Replies (5)

Income Tax Wala: (Fin. Expert)

Chartered Accountants

2015 Points Joined August 2010

mediclaim insurance premium u/s 80D is available 15000/- for non senior citizen 20000/- for senior citizen.

apart from this he may take remuneration as a consultancy fees after retirement and claim all expenditure which are incidental to earn that income. by doing this he would be in a position to save tax drastically.

VINAY MAITHANI

Reliability Engineer

36 Points Joined December 2011

Thank you Tax Pandit ji for the quick response. Really appreciate it.

I have already taken Mediclaim insurance for my parents in Oriental Family Floater where I (an NRI) am the proposer so exemption u/s 80D is ruled out for him. Am i correct ?

Yes you are right he would be a consultant for the same company where he works now.

Under which section can he claim all expenditure which are incidental to earn that income ? If you can name them, i can try to read and find the avenues to book the same accordingly or else seek the help of a CA if it is really required.

Regards

Vinay