Do not make these 5 mistakes to take advantage of tax exemption, otherwise you will have to bear the loss

  • Post category:Tax

The last quarter of the financial year 2020-21 has started. If you are salaried, then your employer will be sending you a reminder mail frequently to submit proof of investment in tax saving instruments. Many employees will be investing without any knowledge in hurry to submit investment proof. Such employees and investors should make investment decisions based on their financial goals. The objective of every investor is to get better returns. Saving tax is an additional benefit. If you meet financial goals as well as save tax, then it will be better. But before investing you should know what is your priority? .

Do not invest in a less profitable scheme
In order to save tax at the last moment, people sit in haste to invest in such products which gives them losses rather than benefits. This leads to loss of more money than the tax saved. Without any motive, investing in a property just for the benefit of tax exemption and to save tax is not right. Know that not all investments yield good returns.

Apart from FD, there are other options
Senior citizens do not invest their money for a long period. They prefer FD for tax savings as it is five years of lock-in period with safe. Many times insurance managers offer endowment plans as an investor option with tax free returns. Senior citizens invest FD understanding. Later they get trapped.

First understand where you are investing
Common investors have considerable confidence in public sector banks. Taking advantage of this trust, the distributors of the insurance company trick the investors. From the information they send through SMS, call or e-mail, it seems that a bank has introduced the respective plan, even if it is an insurance policy in which the bank is in the promoter’s role. They do this because some customers get cautious after hearing the name of the insurance plan, but invest in the bank plan. Especially in small towns and rural areas such plans are sold saying that the bank has introduced it, so it is safe.

First check all the information
According to financial experts, one should not rely on any investment scheme unless it is written on paper. Often agents do not refrain from giving false information to make investments. In order to lure investors, they make promising returns, but this does not happen.

First check all plan details
These days you will be getting suggestions of attractive investment options to avoid income tax through call, SMS and email. There will also be many of these options that promise to provide you insurance cover at regular intervals along with tax savings, besides tax free income and lump sum at maturity. At first glance you will find these plans breathtaking, but later they can cause damage.

Apart from 80C, you can also avail tax exemption here, know where you can invest