Minimise Tax to Maximise Pay

Must-Do Tax-Saving Investments for Financial Success

How do maximise my take home income has been an age old question. I had it when I saw the 1st tax deduction on my play-slip and have been asked in the subsequent years since by every new comer.

We will be listing some low hanging fruits that will help address a big chunk of you tax cut. Will keep it short & to the point.

1. EPF or Employee PF: Usually a % on your base salary. Make sure you have your employer let you avail the maximum amount on it. I have seen so many payslips where companies choose to contribute only the minimum amount.
2. VPF or Voluntary PF: Contributing more to your PF. This would go over an above EPF.
3. National Pension Scheme: Gives you close to large cap returns with options to go conservative per your age. If your employer support EPS, take that too.
4. Insurance: What your company is giving you is as good as no coverage. Read and find yourself the best in the market & the premium amount becomes tax free. Both Life & Medical.
5. Go Electric: The subsidies and tax rebates on EVs are insane. Of late I see great support and the infrastructure supporting EVs is only increasing. If you like in a Tier I city, using an EV is super convenient.
6. ELSS or Tax saving Mutual Funds: These are a category of mutual funds catered to our purpose here. They come with a lock-in of 3years and attractive returns. It’s a great place to park your money for 3–5 year goals.
7. WiFi/PhoneBills/FoodVoucher: These are some of the small components on a monthly level but on the grand scheme of the year, can help you make a good 50k-1L of your take home amount non-taxable.
8. Donations: Religious, social, environmental, educational, anything. If you are doing charity, make sure there’s paper trail. Prefer registered organisations that will give you receipts with their PAN on it. Make sure your name is correctly mentioned too.
9. LTA/Leave & Travel Allowance: You get paid to take off. Well, you just get tax rebate but that’s also money coming in. Save your tickets and be on leave per your company’s policy. This is something often a lot of experienced people omit out too.
10. HRA/House Rent Allowance: A portion of your rent becomes taxable depending on the amount if you can submit a receipt and valid agreement with your landlord’s PAN details.

While these are the no-brainers, there are relatively more complex items to help you bump up your take home salary.
All ten items are extremely easy to be setup. Some are great investment options while others are necessities. I’d be super glad if most of you already have it. For those who don’t, please get them going without another second of contemplation.