1. The misconception between tax-planning and tax-avoidance, both as different as chalk and cheese, often leads many investors, both young and old, in lesser efficient long-term investment of their hard-earned money.
2. While tax-planning means exercising your right to financial interpretations for legitimate tax-saving, tax-avoidance is disregard of taxation laws altogether.
3. We should always have a tax plan ready early in the year to reap the benefits of long-term investing, which involves estimating how much of tax-saving avenues are utilized and ensuring a deadline for its execution, after estimating the possible taxable income considering the allowed exemptions and deductions.
4. Don’t invest in multiple products whose invested sum becomes more than what is required to get the maximum tax benefit available.
5. Don’t buy policies that give low benefits, but the agents get a fat commission.
6. Look out for investments that offer high post-tax returns than those which save taxes but offer lower post-tax returns on a net basis.
7. Don't rush for investments in J-F-M months instead of monthly SIPs the whole year.
8. Don't bunch all the premiums in a single month instead of spreading them over the year.
9. Don’t treat tax planning as the last step before preparation of income tax returns, but something that should be taken up before the start of every financial year.
10. Charity begins at home, however small the tax benefits, especially towards your hard-earned money, as today's water drops are tomorrow's rivers.
2. While tax-planning means exercising your right to financial interpretations for legitimate tax-saving, tax-avoidance is disregard of taxation laws altogether.
3. We should always have a tax plan ready early in the year to reap the benefits of long-term investing, which involves estimating how much of tax-saving avenues are utilized and ensuring a deadline for its execution, after estimating the possible taxable income considering the allowed exemptions and deductions.
4. Don’t invest in multiple products whose invested sum becomes more than what is required to get the maximum tax benefit available.
5. Don’t buy policies that give low benefits, but the agents get a fat commission.
6. Look out for investments that offer high post-tax returns than those which save taxes but offer lower post-tax returns on a net basis.
7. Don't rush for investments in J-F-M months instead of monthly SIPs the whole year.
8. Don't bunch all the premiums in a single month instead of spreading them over the year.
9. Don’t treat tax planning as the last step before preparation of income tax returns, but something that should be taken up before the start of every financial year.
10. Charity begins at home, however small the tax benefits, especially towards your hard-earned money, as today's water drops are tomorrow's rivers.