Plan Now to Increase your Tax Savings
Now you can start taking advantage of the new tax proposal of budget 2014-15 as the both houses of Parliament have passed the Finance Bill 2014. Revisit your tax- saving strategy for the year to maximise your take-home pay. Reduce your tax outgo.
Employees in most organisations already have asked to send revised investment declaration for the year to reasses their tax liabilities following the changes in tax laws. The sooner you do so, the better it will be. Mr Kuldip Kumar, executive director, tax®ulatory services,PWC said that if you don’t revise your earlier declaration, you will continue facing a higher tax outgo every month. Sending a revised declaration this month will allow you to fetch a higher take home pay right away.
The managing director, Ladderup Wealth Management, Mr Raghvendra Nath says: Your employer would have already cut five months tax based on earlier calculations. Now after revising your tax plan for the year, you may find that the actual liability is lower than the one that has already been paid. The revised investment declaration may even entitle some to a tax refund. For instance if an individuals annual income is Rs 3.5 lakh, and he has claimed Section 80C benefits of Rs 1 lakh in the declaration filed earlier, he would have already seen a tax cut of Rs 2,145 over the past five months of the total annual liability of Rs 5,150 (10.3% of Rs 50,000 net taxable income). With the basic exemption limit adjusted upwards to 2.5 lakh, his revised tax liability will now be zero. If you belong to the higher income tax bracket but claim the revised 2 lakh deduction towards payment of interest on your home loan, your liability may also come down significantly and you may be entitled to a refund from the Income Tax Department. However, to get the refund, you will have to file your income tax return before the due date next year.