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Top 10 best tax saving instruments for 2018-2019

  • Highlights

  • Choose the best investment options

  • Reduce out-of-pocket expenses

  • Invest in ELSS, PPF and FDs to claim deductions

  • Choose Bajaj Finserv and check your offer

At the start of each financial year, build your investment folio in such a way that it not only offers high returns, but also helps you lower your tax burden. Focus on instruments that protect your family’s future in case of unfortunate events, help you meet your long- and short-term financial goals and lower your taxable income. This may sound complicated, but it’s as simple as choosing the right mix of tax-saving instruments.

Read on to understand the best investment options that you must include to save on taxes in 2018–2019.

Life insurance

Life insurance is considered an absolute essential as it offers the perfect balance between security and savings. Here you can choose to invest a nominal sum on a monthly or quarterly basis or choose to pay a lump sum each year. Furthermore, you can claim a tax exemption of up to Rs.1.5 lakh under Section 80C of the Income Tax Act. If you select the right Life Insurance Investment Plan through trusted companies like Bajaj Finserv, then you can enjoy extra benefits on your policy along with tax benefits such as partial withdrawal and renewal privileges.

Also, you can check your pre-approved insurance offers and apply online to further simplify the process.

Equity-Linked Saving Scheme

Now, that you know whom you can appoint as a nominee and how to go about it, you can apply for a life insurance policy via Bajaj Finserv. Also, be sure to check your pre-approved insurance offer to expedite and streamline the procedure.

Public Provident Fund

PPF or Public Provident Fund is a long-term investment plan, where you can invest as little as Rs.500 and up to Rs.1,50,000 (per year) either in a lump sum or in instalments. If you want to create wealth for your child’s future or for your retirement, you can open a PPF account in any bank or post office and earn high returns of up to 7.6%. You can claim tax benefits of up to Rs.1.5 lakh under Section 80C of the Income Tax Act for the amount you deposit in your PPF account, and the interest earned on your investment is also tax-free.

Fixed deposits

A fixed deposit is an option that fetches higher interest, especially if you choose a company FD over a bank FD. In addition, you can generate regular returns through a non-cumulative FD or claim the total amount on maturity through a cumulative FD. Apart from the high interest and assured returns, you can also enjoy tax benefits. Interest up to Rs.10,000 (for bank FDs) and Rs.5,000 (for company FDs), is exempt from taxation. In case of the former, the limit for senior citizens is Rs.50,000. Beyond this amount, you have to pay TDS at the rate of 10% if you submit PAN details and 20% if you don’t.

Health insurance

Health insurance is a must-have in your investment folio as it helps you meet rising healthcare costs as well as the effect of inflation on medical care. Depending on the policy you choose, you can take care of your and your family’s treatment, diagnosis, hospitalisation costs, etc. However, selecting good insurance cover is the key here. You should buy a comprehensive policy that lets you claim benefits for a range of acute, terminal, and critical illnesses. You can get the best Health Insurance plans through Bajaj Finserv and enjoy various benefits such as cashless settlement, comprehensive maternity coverage, loyalty discounts and renewal benefits.

Also, you can claim tax exemptions under Section 80D of the Income Tax Act. You can claim exemption up to Rs.25,000 on the premium paid for a health insurance plan for yourself and your immediate family assuming everyone is under the age of 60 years. Apart from this, health insurance premiums paid for your parents aged 60 years and above, entitles you to deduction of Rs.50,000.

So, now that you are familiar with the best investment options that will help you save tax, use them to create the best investment plan. It will combine high- and low-risk investments to offer substantial returns, health and life coverage and good security too.

The information, products, and services included in or available on may include inaccuracies or typographical errors. Changes are periodically added to the information herein. and/or its respective suppliers / affiliates may make improvements and/or changes on the website at any time.
The material contained in this site and on associated web pages is general information and it is not intended to be advice on any particular matter. Subscribers and users should seek professional advice before acting on the basis of the information contained herein. The decision with respect to any financial product or opportunity or nature or suitability or choice or the viability of any product or service shall always be sole responsibility and decision of the subscriber and user.

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