The current financial year is about to end, and this is the best time to review your plans to maximize savings and make a solid start for the coming year. Good financial management will help you save time, money and stress by prioritizing expenses, making informed decisions and allocating resources effectively. As we approach March 31, it is important to reflect on the successes and failures of this year quick guide.
Double check your taxes paid vs taxes due
To begin with, calculate the taxes to be paid for the financial year, which includes income from all sources:
- salary income
- rental income
- business income
- Income (Capital Gain/Loss) from investments like Stocks, MFs, Bonds etc.
- Income from sale of assets (Capital gain/loss)
If the tax paid is substantially less than the taxes due, pay advance tax for the difference as soon as possible and before the financial year ends on March 31, 2023. Timely payment of outstanding taxes prevents heavy penalty interest at the time of filing your returns.
Maximize tax-saving options
Under Section 80C of the Income Tax Act, 1961, an individual is allowed to claim a deduction of up to Rs 1.5 lakh by investing in tax saver products like FD, NPS, PPF, or Mutual Funds. Make sure you take full advantage of this provision. The interest on educational loan is fully deductible under section 80E if one wants to fund higher education for their children. Section 80TTA allows individuals to deduct interest up to Rs 10,000 in a financial year.
The pandemic has put healthcare as a major focus area in many households. Good health insurance coverage can help take care of the medical expenses of the family and it also helps you save tax under section 80D. Health insurance for dependent senior citizens can also be included for tax exemption under this section. Section 80D allows deduction up to Rs 1 lakh.
Explore all these possible tax-saving options to reduce your tax liability as far as possible.
Connect with professional financial advisors
Consult if you are new to financial planning and management or have little experience A CA or a qualified financial advisor is never a bad idea. Depending on your goals and needs, professional financial advisors can suggest better ways to balance your investments and possibly help you maximize the benefits in the form of tax savings made during the financial year.
A financial advisor can provide information and insight on various aspects taking into account your goals and needs, dependents, current age and retirement target age – this includes the amount you can invest every month in different investment channels, health and life insurance coverage investment is required. need, etc.
conclusion
The sooner you assess your financial situation, the sooner you can make necessary improvements without stress. Taking the time to put everything in order regarding your finances is the best decision you will make as the year ends.
Author: Saurav Ghosh, Co-Founder, Giraffe
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