Tax Planning

Tax planning

Every citizen has a fundamental right to avail all the tax incentives provided by the Government. Therefore through prudent tax planning, not only the income tax liability reduced, but also a better future is ensured due to compulsory savings in highly safe government schemes. We sincerely advice all our clients to plan their investments in such a way that the post tax yield is the highest possible, keeping in view the basic parameters of safety and liquidity.

Filing of income tax return is compulsory for all individuals whose gross annual income exceed the maximum limit prescribed by the Income Tax Act. Every one has to file the return within 31st of July and whose annual sales exceeds 40 lacs or professional receipts exceeds 10 lacs then they have to file within 31st October (30th Sept- amendment has to be made)

There are few tax free incomes which you can utilize, they are

1. Interest in PPF or GPF or EPF
2. Interest on GOI tax free bonds
3. Dividends on Shares and on Murual funds
4. Any capital receipt from life insurance policies i.e., sum received either on death of the insured or on maturity of life insurance plans. However, in case of life insurance policies issued after 31st march 2004, exemption on maturity payment under section 10(10D) is available only if the premium paid in any year does not exceed 20% of the sum assured.
5. Interest on Savings Bank account in a Post Office.
6. Long Term capital gains on sale of shares and equity mutual funds if the security transaction tax is paid on such transactions.


Some investments in specified schemes u/s80C and u/s80CCC(1) are deductible form your total income earned. Such investments are
1. Life Insurance Premium
2. Contribution to EPF/GPF
3. PPF (Max 70,000/- in a year)
4. NSC
5. ULIP
6. Repayment of Housing Loan (Principal)
7. ELSS Of Mutual Fund
8. Tuition fees including admission fees or college fees paid for full time education of any two children of the assessee. (Any development fees or donation or payment of a similar nature shall not be eligible for deduction)
9. Infrastructure Bonds issued by institutions/Banks such as REC, PFC etc.,
10. Interest accrued in respect of NSC VIII Issue
11. Pension scheme of LIC of India or any other insurance company
12. FD with Banks having a lock in period of 5 years.

The above provisions applies to the financial year 2007-08 only