Do you agree with the fact that, the utterance of the word “tax” emits a negative feeling among most of the people? It not only can be seen in the realms of the real world, but also in the iconic Bollywood film Lagaan, the film which was based on a fictional story doting a century back, the protagonist had a “fear of paying tax”.
Free Financial Advisory Portal, MoneyMindz talks about this important topic “tax planning” in order to maximise your finances. So, some of the terms like evasion, provision, savings and concealing have been commonly associated over the years. But again it’s on rare occasions that planning is associated with tax related matters.
One common question that engulfs one’s mind is that, “How can I part with my hard earned income with the government?” We get to see that a majority of us try our best to minimize the impact of taxes.
Basically when someone offers quick fix solutions in order to reduce tax outflow from one’s pocket, everyone from entrepreneurs and corporates, salaried employees to professionals could think very carefully over it or even give a second thought.
The months from January to March spell chaos for salaried class as there will be a rush to complete last minute tax savings measures for the salaried. It is the time when year on year unwanted insurance-cum-investment policies are purchased and forgotten as quickly, as they were purchased for only saving taxes.
You will find that young couples invest in property to avail tax benefits on the interest paid on a home loan. Therefore it is regardless whether the purchase is affordable or even required.
You need to remember that it is imperative for everyone to look at all financial aspects to achieve financial goals. Therefore tax planning is important part of saving money, but not the ultimate motive.
Generally people forget that tax planning is a simple process which eventually amalgamates with financial planning. As part of the financial planning, the decisions taken should find a place by default in your tax planning.
We get to see that most commonly used sections for tax savings provide deductions and eligibility formulated in a thoughtful manner that easily merge with an individual’s financial profile.
One can make fixed income for long term investments through EPF and PPF – two of the most tax efficient guaranteed investment products. Through ELSS equity investments are covered, premium for term plan insurance is deductible, health insurance premium for you and your dependants is considered and your home loan interest and principal amounts are also covered.
An individual’s investment needs to be diverted in appropriate financial assets linked to his/her goal. One important thing to remember is that paying taxes on time is the duty of every citizen and let this process not “tax”, but “relax” you.
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