5 Key Points to Consider to submit the Investment Proofs in this Year

5 Key Points to Consider while submitting the Investment Proofs in this Year

Learn how to declare tax-saving investments, choose the right tax regime, and avoid salary cuts. Maximize savings with these expert tips for fiscal 2025.

As a salaried employee, it’s crucial to declare your tax-saving investment proofs to your employer. Doing so ensures that your salary in the last two months of fiscal 2025 is not significantly reduced due to higher tax deductions. Maximize your tax savings this fiscal year! Learn essential tips to declare your investments, choose the right tax regime, and avoid unnecessary salary deductions in 2025.

For instance, if you’ve invested ₹1 lakh in an insurance premium and ₹50,000 in equity-linked savings schemes (ELSS), you can claim an income tax exemption of ₹1.5 lakh. For those in the 30% tax bracket, this translates into a tax saving of ₹45,000, plus 4% cess (₹1,800), totaling ₹46,800.

To make the most of these exemptions, keep the following key points in mind:

5 Key Points for Tax Savings

1. Tax Regime Selection:

Tax exemptions under sections like 80C are available only in the old tax regime, not the new one.
Since the new tax regime is the default, you must opt for the old tax regime to claim these exemptions.

2. Investment Proof Submission:

Inform your employer about your investments early so they can deduct lower TDS (Tax Deducted at Source).
Submit valid proof of your investments; failure to do so will result in TDS deductions based on your full salary.

3. Section 80C Investments:

Taxpayers can claim deductions up to ₹1.5 lakh under Section 80C.
Eligible investments include instruments like NSC, PPF, ULIPs, and more.

4. Additional NPS Deduction:

Subscribers to the National Pension Scheme (NPS) can claim an additional deduction of ₹50,000 under Section 80CCD (1B) for Tier I contributions.

5. Job Changes:

If you’ve switched jobs during the fiscal year, disclose your previous income and deductions to your new employer.
Avoid claiming exemptions twice, which can lead to discrepancies and penalties.

By following these steps and staying proactive, you can ensure smooth tax planning and maximize your savings.

Smart tax planning ensures higher savings and fewer deductions. Follow these strategies to make informed investment decisions and secure your financial goals for the year ahead.

Disclaimer: This is not financial or investment advice. Please conduct your own due diligence or seek expert guidance for financial planning.

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