India follows financial year from April 1 to March 31. Even if the new financial year starts with “Fools Day” (April 1) there are lot of important things related to personal finance you must do now (in the month of April). We list down 7 such things to do:
Do your tax planning (Also Choose from Old Vs New Tax Slabs)
Budget is presented in February and some tax laws related to investment or earning do change effective April 1. You must take notice of such changes and plan accordingly. You must calculate what would your estimated income (its easier for salaried), estimated tax outgo and investments that you can make to minimize the same. Also plan when you want to invest in these tax saving schemes. In case you are looking for ELSS or Tax Saving Mutual Funds do set up SIP to stagger your investment.
How much Taxes you Need to Pay this Year? Download Our Income Tax Calculator to Know your Numbers
Do you know how much tax you need to pay for the year? Have you taken benefit of all tax saving rules and investments? Should you use the “NEW” tax regime or continue with the old one? In case you have all these questions just Download the Free Excel Income Tax Calculator for FY 2021-22 (AY 2022-23) and get your answers.
Submit Form 15G or 15H
In case you are eligible do submit Form 15G and 15H at the start of financial year for all your fixed and recurring deposits. This is required to be done every year to prevent banks from deducting TDS. Remember once the TDS is deducted the only way to get is back is after filing tax return for the year and waiting for the refund. However, do not go overboard and submit in case you are not eligible as that may lead to penal action from income tax department.
The interim Budget raised the TDS (tax deducted at source) threshold for bank and post office deposits from Rs 10,000 to Rs 40,000. For senior citizens above 60, the TDS threshold is already at Rs 50,000.
How to fill Form 15G and Form 15H?
Are you worried about Tax Deduction at Source (TDS). In case you are eligible you can fill up Form 15G (if below 60 years of age) and Form 15H (if senior citizen). We show step by step instruction on how to fill up Form 15G/H and save TDS. Also Many banks now allow online submission of the Forms 15G and 15H.
Submit tax declaration to your employer
At the start of each financial year, salaried have to submit tax saving investment declarations along with HRA, Home Loan, etc to their employer. This is necessary as employer use the information to calculate your tax liability and deduct tax every month. In case you miss this more tax would be deducted which you can only claim after filing your income tax return, which would be more than a year away.
Submitting Income Tax Proof to Employer – Guidelines, Dos & Don’ts
On start of each financial year all salaried employees are asked to submit declaration of rent, tax saving investments among other things. We have details on why salaried class needs to submit these proofs to their employers, how it should be done, what documents to be submitted and if there is a deadline?
Choose your salary components as per your needs
A lot of employers give flexibility to choose your salary structure. You must understand tax free or partially taxable components in the salary and structure it effectively. In case you want to save tax, you may have to keep a higher proportion of salary as reimbursement of phone bills, LTA etc. Also in case you are OK with lesser take home and more investment to your retirement kitty, you can opt for Voluntary Provident Fund and NPS.
How to Pay 0 Income Tax on Salary of Rs 20+ Lakh (FY 2021-22)?
As you can see with the above income tax calculation, salary components and salary structure plays a very important role in how much income tax you pay. We have come up with some optimised salary structure using which you pay NO income tax even with CTC of more than Rs 20 Lakhs.
Invest your Increment
For most salaried, the annual salary revision is effective from April 1. So starting this year you would get increased salary. Its good idea to resist the temptation for lifestyle upgrade. Go for more investment or pre-pay your loans.
Best way to Double your Money
Who does not want more and wouldn’t you love to Double your money? For sure we all would – we have listed 7 authentic investments which you can use to double your money. The post talks not only about the returns but also the risks associated with each investment.
Make investments in PPF, SSA or NPS
In case you have PPF, SSA or NPS accounts and do not invest actively in them, make the minimum contribution to keep it active.
Best Investment to Save Tax
Section 80C offers more than 10 investments where you can invest to save tax, However many a times you need not actually do this investment as its already covered due to expenses like children tuition fee or automatic EPF deduction for salaried. In case you are new to taxes and investment do read our helpful guide on How to take maximum advantage of Section 80C and choose the best investment to save tax.