Importance and Benefits of Tax Saving
In order to ensure that a country’s government functions smoothly and provides the resources that its citizens need, income tax becomes an essential duty. Therefore, income taxes should not just be considered a burden to bear but rather a responsibility to fulfill.
Every tax season, taxpayers must make sure that they file their returns and pay their fair share of taxes. But keep in mind that the Indian government has also laid out various provisions that allow taxpayers to make their choice of investments and shave off considerably from their taxable incomes.
As a taxpayer, you should be just as concerned with overpaying your share of income tax as with underpaying it. That is why your process of tax return filing should always take the component and benefits of tax saving into account. To understand this topic better, let us explore the importance and benefits of tax saving further.
Incorporating Tax Saving Early
Every year, a growing number of working professionals are introduced to the taxation system. This includes various recent graduates and young, fledgling professionals. These are first-time taxpayers who are just venturing into their careers and therefore, do not have a large income to be concerned about. Keep in mind that under our tax system, an annual income of Rs. 2.5 lakhs is entirely exempted from tax.
It is easy at that stage in your career to not worry about tax saving being an essential part of your income tax process. The benefits of tax saving can seem inconsequential. However, this can often set an unfavourable precedent for years to come.
As your career grows and your income witnesses an increase, tax saving should become an important aspect of your tax planning every year. Higher incomes are subject to higher tax rates, which is why it is prudent to save up as much of your hard-earned income as possible. Hence, the aspect of making crucial investments that can lower your tax burden for years to come, should be inculcated as early in your career as possible.
Benefits of Tax Saving
There are various benefits of tax saving if it is incorporated into your tax returns every financial year, even if your income is not substantial at present:
At the end of the day, the benefits of tax saving look different for different taxpayers. However, one tax-saving option should always be considered by every taxpayer - a credible term insurance plan. To that end, an excellent option is the iSelect Star Term Plan from Canara HSBC Life Insurance. Not only does the iSelect Star Term Plan offer extensive coverage to your beneficiaries, it also allows you to avail deductions as high as Rs. 1.5 lakhs under Section 80C.
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