Popular Tax Saving Options (other than 80C included) for 2023

Thinking on How to Save on Income Tax in 2023? Well, we have got some Investment Ideas which can be beneficial for Tax Deductions. Also, other than ITR 80C Saving Schemes are included. This guide is for Salaried Professionals, Individual Small-scale Businesses, Senior Citizens, and Freelancers.

Some of the common questions that come across Tax Saving enthusiasts include the following:-

• Lock-in period

• Tax Deduction types

• How Does Income Tax Section 80 Work?

• When to start Investments for Tax Savings?

All these questions will be answered in this article so let’s move on.

Firstly, let’s have a look at the Investment options for Saving under ITR Section 80C. These can Save you upto ₹2,00,000 of Taxes in 2023.

You can Invest from ₹500-₹1,50,000 in PPF in a year. This is a 15 year long-term tax saving investment plan. You cannot withdraw an amount before 7 years so make a note. You can avail tax deduction for PPF deposits under section 80C of ITR. Also, you don’t need to pay tax on Interest earned under Section 10. The Interest rate here is around 7%.

If you age between 18-70 then you can Invest via NPS. This is the best official way to get retirement ready in the future. Also, saves via tax deductions upto ₹2 lakhs under section 80C and 80CCD. Here, you can earn Interest in the range of 9%-12%.

An ULIP helps in long-term investments, tax savings, and getting Life Insurance coverage. Here, you get the flexibility to pay premiums. Moreover, you can withdraw some amount at any time. Additionally, it suits low-risk investors with many go-to investing options.

ELSS Mutual Funds are great for both tax savings (upto ₹1.5 lakh) and higher returns (15%-20%). The lock-in period here is 3 years. ELSS stands for Equity Linked Savings Scheme.

You can opt-in for a whole, universal, or term life insurance. The best time to get it is at a younger age as it not only helps in tax savings but also incur lower premiums. It is recommended as the most important Investment option an Indian must have.

Apart from NPS, there are many pension plans available from leading firms such as Max Life, SBI Life, LIC, ICICI Prudential, and HDFC Life. Tax deductions here are covered under section 80CCC.

If there are seniors (above 60 yrs) in your family then SCSS is a safe tax saving and Investment option. The current ROI here is 8% as the government recently hiked rates. This is a 5-yr plan which can be extended to max 8 years.

NSC is a low-risk and good tax saving Investment option. Rate of Interest is around 7%. This scheme suits best to low and middle income groups. There is a 5-yr and 10-yr Investment option here.

You will find FDs in almost all Indian households making it a popular choice among the middle class public. Here, the lock-in period is 5 years and tax savings are limited to ₹1,50,000 per year.

Now, let’s have a look at some of the other Income tax saving options for salaried people which can come in handy when the exemption limit is exceeded.

These were some of the popular ways to save on Income Tax in 2023. However, it is recommended to consult your financial advisor to get the best options based on your income, job/business, preferred risk, and other factors.