Tax saving investments: People using the old regime of income tax can claim deduction by investing up to Rs 1.5 lakh annually under section 80C. If you want to claim deduction for the financial year 2024-25, then you have to make this investment by 31, 2025
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If you want to do tax-savings, then you have to do this work before 31st March. Only then you will be able to make a deduction of up to Rs 1.5 lakh under section 80C of the Income Tax Act for the financial year 2024-25. However, these deductions are available only in the old regime of income tax. If you are using the old regime, then you can invest in the following investment options.
Public Provident Fund (PPF)
This is the most attractive tax-saving investment option under section 80C. The interest rate of PPF is currently 7.1 percent, which is higher than the interest rate of other schemes. The government reviews the interest rate every three months. You can claim deduction by investing from Rs 500 to Rs 1.5 lakh in PPF.
Sukanya Samriddhi Yojana (SSY)
This scheme is for parents who have daughters. Parents can open Sukanya Samriddhi account for their two daughters. Its interest rate is 8.2 percent, which is more than PPF. A minimum investment of Rs 250 has to be made in this account. The interest received in this scheme is tax-free. Parents can open Sukanya Samriddhi account for two daughters below 10 years of age.
National Savings Certificate (NSC)
A minimum investment of Rs 1,000 is required in National Savings Certificate. Its interest rate is 7.7 percent. The duration of NSC is 5 years. After that this account gets matured. Those who do not want to take much risk can buy this certificate and claim deduction.
Senior Citizens Savings Scheme
People above 60 years of age can invest in Senior Citizens Savings Scheme. Its lock-in period is 5 years. One can invest in it from Rs 1,000 to Rs 30 lakh. However, deduction can be claimed only up to the limit of Rs 1.5 lakh under section 80C. Its interest is 8.2 percent.
5-Year Tax-Saving Bank Deposit
You can claim a deduction by making a 5-year deposit in a bank. This is similar to a bank fixed deposit. Only, a lock-in period of 5 years is attached to it. This means you cannot withdraw your money before 5 years.
Mutual Fund Tax Savings Scheme
If you can take a little risk, then you can invest in the tax-savings scheme of mutual funds. The lock-in period in this is only 3 years. Its returns are attractive compared to other investment options under section 80C.
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