Producer: Mehak Pal Editor: Sujata Singh
We all are required to submit proof of tax-saving investments soon or face a higher TDS. Here is a look at 10 tax-saving options that are ideal, based on returns, safety, flexibility, liquidity, costs, transparency, ease of investment, and taxability of income.
RETURNS: 8.16% in the past five years Lock-in: Till retirement
(The additional deduction offered by the scheme is very useful for those with surplus funds.)
RETURNS: 18.24% Past five years Lock-in: 3 years
(ELSS funds, especially large-cap-oriented schemes, are expected to do well in the near term.)
RETURNS: 8.15% in the past five years Lock-in: 5 years
(These insurance-cum-investment plans are tax-free. However, these are not as flexible as ELSS.)
RETURNS :8.2% in Jan-Mar 2024s Lock-in: 5 years
(It’s the best way to save tax for senior citizens. A new rule allows unlimited extensions makes it more attractive.)
RETURNS: 8.2% in Jan-Mar 2024 Lock-in: Till the child is 18
(The recent hike in interest rate has made it an attractive option for parents with girl children. But it has a limited scope.)
RETURNS: 7-9% in past five years Lock-in: 5 years
(These hybrid funds invest in a mix of equity and debt. The debt portion gives stability, while the equity portion helps generate good returns.)
RETURNS: 7-14% in the past five years Lock-in: Till retirement
(Pension plans from insurance companies can’t match the NPS on costs, flexibility, and tax benefits.)
RETURNS: 7.1% in Jan-Mar 2024 Lock-in: 15 years from inception
(Its tax-free interest has made it more attractive than bank deposits, but watch out for the long lock-in period.)
RETURNS: 7-8% Lock-in: 5 years
(It is a good option only for late risers and senior citizens who may have exhausted the investment limit in SCSS.)
RETURNS: 5-6% Lock-in: Minimum 5 years
(It is the worst way to save tax. Corpus is tax-free but flexibility and returns are very low.)