New Delhi:
Best Tax-Saving Investment Options: In the last few years, women’s participation in investment has increased considerably. This indicates that in today’s era, women are taking great interest in managing their finance. There are many investment options in India which give tax benefits. Most investors are looking for similar options while investing so that they can save their tax. There are some from these options that are available for both men and women, while some are for retirement.
Today we will tell about those investment options that women (Investment Options for Women) can use to save tax.
Sukanya Samriddhi Yojana (Sukanya Samriddhi Yojana)
The government’s Sukanya Samriddhi Yojana is a good option to save tax for working women. It is also known by the name of SSY in short. SSY is an investment option that encourages parents to invest for his daughter’s education and marriage. If your child is under 10 years of age, then you can take advantage of this scheme.
This government scheme comes in EEE (exempt-exmept-exempt) tax category. This means that the investor will not have to pay any tax on investment, income or withdrawal from it. Section 10 (11A) of the Income Tax Act, 1961 provides this exemption. The amount invested in this scheme is eligible for deduction under section 80C, which is limited to Rs 1.5 lakh.
National Savings Certificate
Section 80C of the Income Tax Act allows to claim deduction on investment made in National Savings Certificate. The maximum limit of deduction claim is Rs 1.5 lakh. The scheme available in the post office currently offers a fixed return of 7.7% with a minimum deposit of Rs 1,000. The interest rate on this scheme is reviewed from time to time.
Public Provident Fund (PPF)
In this scheme, you can deposit a minimum of Rs 500 and a maximum of Rs 1.5 lakh in every financial year. Public Provident Fund is a good investment option for women who want to save tax as well as attractive returns. The Finance Ministry has fixed the interest rate of 7.10% annually on the Public Provident Fund (PPF) till the third quarter of the financial year 2025.
The interest and withdrawal on the amount deposited in the PPF account is not tax-free, ie it is tax-free as well as a tax benefit claim on this investment under section 80C. The maturity period of PPF account is 15 years. However, this period can be extended to a 5 -year block.
Insurance
Insurance not only helps you in difficult times but is also a good option to tax. Women investors can also claim tax benefit on life insurance policies. The deduction claim can be claimed for the policies taken for themselves including your spouse and child. However, more than 10% deduction of total sum insured cannot be claimed.
This limit is 15% of the total insurance amount for a person with certain diseases under Section 80U of Income Tax. Cut cuts on health insurance premium for your family can be claimed. In this, you can claim deduction at the premium paid for yourself, your spouse, children, and parents.
Equity-Linked Savings Scheme
Section 80C of the Income Tax Act offers tax benefits for the equity-linked saving scheme. Since the return on this investment is related to the market, this option comes with high risk. ELSS (Equity-Linked Savings Scheme) has a three-year lock-in period. In view of this, this option is good for those women who have more risk ability.
Employee Provident Fund
In a financial year, a tax benefit can be claimed under Section 80C of Income Tax on investment up to Rs 1.50 lakh made in EPF (Employee Provident Fund).
National pension system (nPS)
In addition to a cut of Rs 1.5 lakh available under section 80C, NPS subscribers get the benefit of additional cuts on investment up to Rs 50,000 in NPS under Sub Section 80CCD (1B). That is, in this way they can save tax on investment of Rs 2 lakh.
Tax-Saving Fixed Deposit
Banks and post offices offer tax deductions under section 80C on fixed deposits with minimum lock-in period of five years. The tax deduction limit is Rs 1.5 lakh annually, but the income from investment is taxable.
Home Loan
Under Section 80C of the Income Tax Act, a tax deduction of up to Rs 1.5 lakh can be availed in every financial year on the report of the principal amount of home loan. You can also claim a tax benefit of up to Rs 2 lakh on the interest paid on your home loan under section 24 (b) of the Income Tax Act.
Senior Citizen Savings Scheme
Investments made in Senior Citizen Savings Scheme (SCSS) can also be claimed by tax deduction under section (80C).