5 Tips to save tax on your income in 2020:

5 Tips to save tax on your income in 2020:

A proper investment planning is very much necessary for saving taxation. In order to get this planning, you should listen to your investment planner or advisor having thorough knowledge about the market. For making market-linked investments, the first thing you need to do is opt for Demat account opening.

How can you be benefitted with tax savings?

Every earning individual wishes to save taxes and for that, they make different kinds of investments. Tax savings can help in saving huge money and you can utilize that money on different important affairs. These savings can increase the potential of your income to a great extent. Further investments for good returns can be made from these savings. Your monthly expenses can be properly dealt and your personal savings can get a boost if you save taxes on your income.

Five best options for saving income taxes:

  1. Mutual funds: Mutual funds investment has been currently recognized as one of the best strategies that can help you in saving your income taxes. But in this case, only equity-linked savings-schemes can benefit you. These kinds of investments not only save your taxes but also give you higher returns at the end of the day. This is why these dual-benefit investments are chosen by most of the smartest investors of the present era.
  2. Pension plans: You can now take the decision of investing over those pension plans that can help you save taxes. Pension plans are highly secured as they cater to great protection or security to your post-retirement life. Nowadays, you can receive a lot of variations in pension plans out of which you can choose the most suitable option that perfectly matches your tax-saving investment goals.
  3. Life-insurance policies: There are many people who think that these policies only safeguard your life but this is not the complete fact. Protecting life is definitely one of the leading aims of these policies but they can save taxes as well. In fact, there are some people who choose these policies solely for saving their taxes. Here, you can have choices of selecting policies with the highest returns. In this regard, unit-linked insurance policies seem to be the best option amongst all.
  4. NSC: Certificates of National savings are also quite an ideal option for saving taxes. Here, both the minimum investment amount and lock-in period are comparatively lower. If you are looking for a secure and low-risk investment along with potential taxation benefits then nothing can be the best option other than this solution. In fact, nowadays most expert financial advisors are strongly recommending their clients to go for the same in order to have a balanced investment portfolio.
  5. Taxsaving fixed-deposits: There are some fixed-deposit schemes where you can avail the opportunity of saving great taxes. In this case, you have to choose minimum 5-years of lock-in period for receiving the fullest benefits. These schemes are generally quite lucrative and they are usually offered by banks.

You should always choose such a tax-saving scheme that can cater your long-term benefits. Tax-saving schemes are chosen on the basis of the income generated and thus you should consider the same.

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