Income tax: Four money-saving tricks to get on monitor for 2024

Here are some tax tricks to get on monitor for 2024

If you continue to have not had an opportunity to know the 2 regimes (new tax regime, outdated tax regime), now is an efficient time to see which one would work greatest for you. 

If you might have revenue as much as ₹7 lakh then the brand new tax regime is best, as there isn’t any tax as much as ₹7 lakh and moreover, there’s a normal deduction of ₹50,000 within the new tax regime. As per the adjustments proposed in Union Budget 2023, no tax could be levied on individuals with annual revenue of as much as ₹7 lakh below the brand new tax regime but it surely made no adjustments for many who proceed within the outdated regime that gives for tax exemptions and deductions on investments and bills similar to HRA.

“Even although you might have the choice to change to a extra beneficial regime on the time of submitting your ITR, it might be higher to be taught to handle taxes simply, in order that TDS takes care of your tax outgo primarily based on whichever regime is helpful to you,” said Archit Gupta, Founder, and CEO, Clear.

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The old tax regime that comes with exemptions on certain investments and expenditures will remain attractive for taxpayers who pay house rent or have a home loan.

Archit Gupta said that individuals opting for the old regime, should make efforts to maximise Section 80C deduction where total taxable income can be reduced by ₹1.5 lakh. 

There are many options available based on your risk profile and your time horizon to invest. Many taxpayers who opt for the old regime don’t maximise Section 80C and hence end up paying some extra tax, Gupta added.

3) Tax harvesting

Stock markets have been volatile lately, and this can be turned into a big opportunity for investors who pay income tax. They can reduce their income tax outgo through loss harvesting. 

“It would help to review your tax dues concerning capital gains tax, and see if there is a possibility to lower tax outgo via tax harvesting your gains,” stated Archit Gupta.

4) Job change

The tax liability of an individual is decided primarily based on the combination revenue earned in the course of the 12 months from all of the sources taken collectively. 

“If you might have switched jobs in the course of the 12 months, intimate your earlier employer to share your pay and tax calculation which have to be submitted to your second employer, for correct tax calculation and to keep away from the situation the place it’s possible you’ll find yourself paying a better tax whereas submitting your ITR,” said Archit Gupta.

Disclaimer: The views and recommendations made above are those of individual analysts, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Updated: 21 Nov 2023, 02:23 PM IST