Tax saving information for girls salaried workers in 2023

Dr. Suresh Surana, Founder, RSM India

Some of the tax and different incentives which a girls salaried worker can avail embrace decreased curiosity on dwelling mortgage, stamp responsibility concession and so on. to empower girls. Besides the aforesaid advantages, among the tax deductions / reliefs which salaried girls might avail are as follows:

Tax Savings particularly pertaining to Salary Income:

1. Section 16(ia) – Standard Deduction

Every worker together with girls worker might declare a typical wage deduction of upto Rs. 50,000 u/s 16(ia) of the Income Tax Act, 1961 (hereinafter known as ‘the IT Act’). It is pertinent to notice that such normal deduction could also be claimed by the ladies worker underneath each the outdated in addition to the proposed new tax regime.

2. 10(13A) – House Rent Allowance (‘HRA’)

Every salaried girls worker who’s in receipt of HRA and who resides in a rental lodging might avail the good thing about exemption underneath this part supplied he/she doesn’t personal any residential lodging occupied by him.

Least of the next:

(a) Actual HRA Received

(b) 40% of Salary (50%, if home located in Mumbai, Calcutta, Delhi or Madras)

(c) Rent paid in extra of 10% of wage

For the aim of computation of such HRA exemption, Salary would represent the Basic wage plus Dearness Allowance (if a part of retirement profit) and Turnover primarily based Commission.

3. 10(14) – Special Allowances

Many workers together with girls workers are in receipt of Conveyance Allowance, Daily Allowance, Helper/Assistant Allowance, Uniform Allowance from their employer in opposition to which they might declare exemption of an quantity which might be decrease of the next:

(a) Allowance obtained

(b) Actual quantity spent

Further, Salaried girls who obtain sure particular allowances similar to Children Education Allowance, Children Hostel Expenditure Allowance, and so on. can declare an exemption as much as Rs. 100 monthly (for training) /300 monthly (for hostel) per youngster as much as a most of two youngsters.

4. 10(5) – Leave Travel Allowance (LTA)

Every girls worker who’s in receipt of LTA can declare deduction in reference to expenditure incurred (for self and household*) in the direction of travelling inside India. Family would represent her husband and kids; dad and mom, brothers and sisters who’re wholly or primarily depending on her. The exemption of LTA might be availed for 2 journeys carried out in a block of 4 calendar years i.e. 2022-2025, as per the prescribed circumstances.

Other Common Tax Saving Opportunities:

1. Section 80C – Investment in Sukanya Samridhi Yojana (SSY)

Sukanya Samridhi Yojana was initiated by the Indian authorities underneath the marketing campaign named “Beti Bachao Beti Padhao” and is at the moment offering 7.6% rate of interest. The advantage of this scheme might be availed by a single household for optimum 2 ladies, supplied the account is opened at a put up workplace or industrial financial institution until she attains the age of 10.

A minimal and most deposit of Rs. 250 and Rs. 1,50,000 respectively might be made in such scheme in any specific monetary 12 months. Amount deposited within the scheme might be claimed as a deduction from the taxable revenue as much as Rs. 1,50,000 u/s 80C of Income Tax Act, 1961 (herein after known as ‘IT Act’). Further, any curiosity earned on such scheme could be tax free.

2. Section 80C – Deduction for sure specified Investments and Expenditures:

Section 80C of the IT Act is without doubt one of the hottest deductions which each girls worker ought to avail because it provides funding linked and expenditure primarily based deductions. Some of the funding linked choices underneath this part embrace Life Insurance Premium, Contribution to PPF, Equity Linked Savings Scheme (‘ELSS’), investments in 5 years mounted deposits, and so on.

Further, the part permits deduction for expenditure incurred for Tuition charges paid for youngsters’s training in India, stamp responsibility / registration expenses, principal reimbursement of housing mortgage, and so on. The complete quantum of deduction underneath this part is upto Rs. 1,50,000 per Financial Year (FY) underneath this part. Majority of the ladies taxpayers ought to intention to avail full profit underneath this part which might in the end scale back their primary tax legal responsibility upto Rs. 45,000 (i.e. Rs. 1,50,000*30% – assuming they fall within the 30% tax bracket)

3. Section 80CCD(1B) – Deduction for National Pension Scheme

Women taxpayers who contribute to a notified National Pension Scheme, can avail deduction of upto Rs. 50,000 underneath this part, which is in addition to the restrict of part 80C mentioned above. Thus, a salaried girl can successfully save tax on the taxable revenue upto Rs. 2,00,000 per Financial Year i.e. ₹1,50,000 u/s 80C and ₹50,000 underneath this part.

4. Section 80TTA/80TTB – Deduction for Interest on Bank Accounts:

Almost each taxpayer together with girls taxpayers holds a Savings Account in some or the opposite financial institution and earns curiosity on the identical. As per part 80TTA, girls taxpayers who earn curiosity on financial savings account maintained both with a financial institution or a put up workplace, can declare deduction upto Rs. 10,000 per FY. Further, Section 80TTB of the IT Act offers further profit to resident senior girls residents, whereby it enhances the utmost restrict of deduction to Rs. 50,000 per FY and in addition extends the good thing about curiosity obtained on time/mounted deposits.

Apart from the aforementioned tax advantages, girls can also avail the next advantages:

1. Stamp responsibility concession

Stamp responsibility is a tax that the federal government levies normally on switch of property or property whereby such stamp responsibility charges varies from state to state. Many states supply concession on stamp responsibility payable for feminine property patrons. For occasion, Maharashtra authorities provides concession of 1% to girls dwelling patrons, topic to achievement of sure circumstances. Deduction for such stamp responsibility paid might be claimed u/s 80C of IT Act topic to the brink of Rs. 1.5 lakhs.

2. Home Loan Benefits

In order to extend girls’s involvement in family monetary selections, many banks and NBFCs supply further advantages to girls borrower like preferential rates of interest, custom-made schemes and so on. The deduction for similar might be claimed by girls u/s 24(b) and 80C of IT Act.

Further, the Budget 2023 additionally proposed a one-time new small financial savings scheme, Mahila Samman Savings Certificate, which might be made out there for a two-year interval as much as March 2025. This scheme will supply deposit facility upto 2 lakh within the title of ladies or ladies for a tenor of two years at mounted rate of interest of seven.5 per cent with partial withdrawal choice. The intricate particulars and tax advantages of the stated scheme are nonetheless awaited from the Government.

Vivek Jain, Head – Investments, Policybazaar.com

Women can maximise their financial savings manifold if they’re acquainted with tax saving advantages that they’re entitled to avail.

Guaranteed returns plan: For girls who wish to play secure and aren’t keen to take funding dangers ought to go for assured return plans providing excessive returns ranging between 7- 7.5%. While, those that are able to sort out reasonable threat of their investments can select capital assure plans, that are a mixture of assured return plans and ULIPs. Those who select to spend money on assured return plans are entitled to a rebate of as much as ₹1.5 lakh underneath Section 80C owing to the life insurance coverage part. Additionally, these plans include a life cowl that’s 10X the annual premium, making it worthy and tax-free underneath Section 10(10)D. However, after thirty first March, the returns on conventional plans can be topic to taxation if annual premium exceeds ₹5 lakhs.

ULIPs:

Another choice for salaried girls workers to park their funds properly is by way of investing in insurance-cum-investment merchandise similar to Unit-Linked Insurance Plans (ULIPs). With ULIPs, they will fetch excessive returns ranging between 12-15% underneath beneficial market circumstances and luxuriate in a life insurance coverage cowl as properly. These plans include twin tax advantages, one on the time of premium cost and the opposite on the time of maturity owing to the life insurance coverage part underneath Section 80C and 10 (10D), respectively.

Wisely navigating by these choices may also help girls select the suitable funding choices and avail tax saving choices as per their wants and monetary objectives.

S Ravi, Former Chairman of Bombay Stock Exchange (BSE)

As a salaried girl worker, a number of tax-saving choices can be found to you in 2023. Here’s a information that will help you profit from them:

1. Invest in a Public Provident Fund (PPF) account – This long-term funding provides tax advantages underneath Section 80C of the Income Tax Act. Women also can get pleasure from increased rates of interest on their investments in PPF accounts.

2. Opt for a National Pension Scheme (NPS) – Investing in NPS also can enable you to save tax underneath Section 80C. Women also can declare a further deduction of Rs. 50,000 underneath Section 80CCD (1B).

3. Claim deductions on dwelling mortgage curiosity – If you’ve got taken a house mortgage, you possibly can declare deductions on the curiosity paid on the mortgage underneath Section 24 of the Income Tax Act. Women also can declare a further deduction of Rs. 1.5 lakh underneath Section 80EEA.

4. Utilize medical insurance coverage advantages – As a salaried worker, you’ll have medical insurance coverage supplied by your employer. You also can declare deductions on the premium paid for medical insurance coverage underneath Section 80D.

5. Claim deductions on training mortgage curiosity – If you’ve got taken an training mortgage, you possibly can declare deductions on the curiosity paid on the mortgage underneath Section 80E.

By using these tax-saving choices, girls salaried workers can considerably scale back their tax legal responsibility and enhance their financial savings.

Abhijit Roy, Co-Founder & CEO- GoldenPi Technologies

The nation is witnessing the expansion of ladies employment at a fast pace. Women might be seen now taking on management roles, beginning their very own companies and at par with males in all elements of life. In order to empower girls, the federal government of India nevertheless offers quite a lot of perks and reliefs, similar to decreased rates of interest on home loans, property tax rebates, and stamp responsibility concessions.

Prior to 2012-13, there have been a number of tax slabs for female and male taxpayers. This has now modified with the implementation of equal tax slabs for women and men. Several analysis research have proven that ladies have now began taking complete management of their monetary selections and are working in the direction of growing their monetary independence. Significant efforts are being put in to grasp numerous modes of financial savings, tax reliefs and rebates. Here are among the methods to profit from the advantages which might be out there with these tax-savings perks.

– Reduction in tax by HRA (House Rent Allowance) – If you pay home lease, you could be entitled to HRA tax advantages.

– Paying premium for Health Insurance- Under Section 80D, declare as much as Rs. 25,000 a premium paid in the direction of medical insurance for your self, partner, and dependent youngsters.

– Tax-Free Bonds – Women who’re in search of long run funding of 10-20 years can confidently go for Public Sector Organizations bonds the place principal and payback are secured. Like different bonds, tax- free bonds do have excessive returns starting from 5.25% to five.30% which is predicted to fluctuate with market circumstances.

– Tax-Saving funding – Claim part 80C deduction upto 1.5 lakhs

– Child Education – Claim tax exemptions on youngster training and medical allowances supplied by the employer.

– Mahila Samman Savings- This programme will supply a hard and fast rate of interest of seven.5%, which is considerably increased than most financial institution FDs and different well-liked small financial savings schemes. This can be out there for a interval of two years, from April 2023 to March 2025.

Dr. Kshama Sharma (AVP – Customer Success), Pazcare

In at present’s world, girls are efficiently carving area of interest for them self in each area. They hustle in between work and residential with out complaining. Many girls get pleasure from monetary independence and make the most effective life selections. Tax consultants, say that revenue tax guidelines are typically gender-neutral.

According to me each salaried girl shall take management of their funds and of taxes. By making proper funding selections. By availing of tax exemptions girls can minimise their tax legal responsibility.

Several way of life illnesses affecting younger adults together with Women. Health dangers will increase as girls get older. Health insurance coverage is should with regards to well being safety. Women workers also can avail of tax exemptions on medical insurance premiums. Maximum tax restrict on medical insurance premiums of ₹25,000 for self/partner/dependents and fogeys and ₹50,000 for senior residents doesn’t simply safe future healthcare prices, it additionally helps salaried workers in saving taxes underneath 80D.

Apart from that, Tax rebate might be taken on wage parts of House lease allowance, Leave journey allowance, Education mortgage curiosity and so on. Investing underneath 80C schemes is the best solution to save tax. It won’t solely prevent taxes, however it can give you a corpus after a sure interval.

Women are at all times recognized for his or her saving abilities so it’s simpler for them to maximise their saving by realizing concerning the tax advantages they’re eligible for. Also, taking management of cash issues enhances confidence of a person.

Shilpa Arora, COO and Co-Founder of Insurance Samadhan

Tax saving is usually a daunting job for a lot of girls salaried workers, however it does not must be. As a girl in 2023, it is important to grasp your tax-saving choices and benefit from them to maximise your financial savings and empower your funds. From claiming deductions on investments similar to ELSS, PPF, and NPS to using tax exemptions on medical insurance premiums and training bills, there are lots of methods to avoid wasting on taxes. By staying knowledgeable and making knowledgeable monetary selections, you possibly can safe a brighter monetary future for your self and your family members. Remember, somewhat little bit of planning and strategizing can go a good distance in reaching your monetary objectives.

Shruti Aggarwal, Cofounder, Stashfin

It fills my coronary heart with satisfaction to see a rise within the variety of salaried girls within the nation. As girls have gotten extra impartial and taking full management of their funds, it has grow to be crucial for them to do their tax planning properly and maximize their financial savings. First and a very powerful factor that ladies can do to avoid wasting on taxes is to grasp exemptions and deductions out there on totally different sorts of investments and funds. After understanding the foundations clearly, girls can begin investing their financial savings in quite a lot of low-cost funding selections like bonds, fairness shares, provident funds, pension plans, and mutual fund systematic funding plans (SIPs).

Further, the National Pension Scheme launched by the federal government also can assist girls workers in making a retirement fund for themselves. While private loans are typically non-taxable, salaried workers can nonetheless use their home and training loans to avail of sure tax advantages.

At Stashfin, now we have at all times tried to interrupt down the stereotypes related to girls and funds. We know that the extra financially empowered a girl is, the higher a rustic will progress. Therefore, we wish to encourage girls throughout the nation to be extra assured and take management of their private funds.

Kuldeep Parashar, Co-Founder, PensionField

Women for many years have been depending on males within the household for monetary recommendation and work, however with the appearance of know-how, this notion is altering quickly. In at present’s digital age, all the things is simple to make use of and entry, empowering girls to take cost of their funds. We imagine in ‘Khud kar lenge’ – the long run is all about self-reliance.

Long gone are the times when girls needed to depend on their husbands or fathers for monetary selections. With know-how at our fingertips, we will entry all the mandatory info and instruments to make knowledgeable selections about our funds. My personal sister used to ask for assist with tax submitting and financial savings, however now she does it herself as a result of all the things is so simple and user-friendly.

We are dedicated to serving to girls obtain monetary independence. We strongly suggest NPS and optimising the VPF & EPF as easy and efficient methods to avoid wasting taxes and guarantee a safe monetary future. 2023 presents a world of alternative for girls salaried workers. As you navigate your skilled journey, keep in mind to prioritise your monetary wellbeing. By taking management of your funds and constructing a robust help community of mentors and friends who can information and encourage you we will create a brighter tomorrow for yourselves and your households. This girls’s day let’s embrace the ability of know-how and ‘Khud kar lenge’!

Jhalak Jain, AVP – Investments, FinEdge

Indian tax legal guidelines don’t discriminate between women and men – therefore, a uniform tax system is offered to each. Having stated that, there are some things that salaried girls can particularly consider in the event that they go for the outdated regime as a substitute of the brand new one.

First, don’t let your pure threat aversion steer you in the direction of conventional tax financial savings avenues similar to Tax Saving FDs, PF, NSC or Life Insurance. It could be quite a bit wiser to channelize your tax saving funding into an ELSS (Equity Linked Savings Scheme) that’s extra risky however may also help you create wealth to your long-term objectives. Instead of succumbing to the yearend rush, begin a SIP initially if the monetary 12 months as that may enable you to profit from rupee value averaging. Speak to a certified advisor, align the funding to a purpose, and perceive the chance and reward related to ELSS funds earlier than you make investments.

In addition to your ELSS funding, you possibly can additionally contemplate investing a further Rs. 50,000 a 12 months into NPS to benefit from Section 80CCD(1b), however just be sure you max out the fairness part to the ceiling restrict of 75%! NPS is a protracted vary funding, and selecting to stay predominantly within the C or D choices won’t do justice to your time horizon.

Just a few issues to bear in mind on insurance coverage, which has historically been a preferred tax saving funding: First, don’t take up a life insurance coverage coverage should you don’t have monetary dependents! It’s a waste of your hard-earned cash as you don’t want the chance cowl and there are much better funding avenues out there. Second, do take up medical insurance in case your loved ones isn’t already lined outdoors of a company mediclaim. Your contributions can be deductible underneath Section 80D, and also you’ll be sure that your loved ones’s monetary plan doesn’t get derailed in case of an unlucky medical emergency.

Aftab Chaz, Associate Director and Business Head at Elephant.in

In India, the proportion of salaried/ working is rising throughout all industries, and the tax slabs are actually gender impartial. Any girl who earns a wage is answerable for managing her funds and paying taxes. It is thus essential to pay attention to the exemptions and deductions that apply to particular investments and funds. Every monetary 12 months, working girls search for newer choices for tax financial savings. From investing in PPF to ELSS mutual fund schemes, to call a couple of, there are a number of tax-saving choices out there for girls at present. However, there’s one important tax-saving instrument that ladies usually overlook, and that’s insurance coverage.

Health Insurance is one such tax saving instrument which not solely helps girls meet the unprecedented medical bills, but in addition acts as tax saving instrument. Under Section 80D, one can avail an revenue tax deduction, in opposition to healthcare associated bills and the cost of medical insurance premiums. The quantity of tax deductions out there underneath Section 80D is set by the quantity and age of the folks lined underneath medical insurance. The taxpayer can save as much as ₹25,000, ₹50,000, ₹75,000, or ₹1 lakh, relying on the lined people. Section 80D additionally covers funds made for preventive well being check-ups, important sickness, and different health-related riders supplied underneath a life insurance coverage coverage. Tax deductions might be availed for each kinds of medical insurance insurance policies: outlined profit, the place a hard and fast quantity is paid as a declare, and indemnity, the place the declare is paid primarily based on the medical bills topic to the general sum insured.

Other than that, there are different tax saving choices for salaried girls too, the place they will save their taxes underneath Section 80 C. Tools like- Public Provident Fund (PPF), Guaranteed Return Investment Plans, Equity Linked Saving Scheme (ELSS), Employee Provident Fund (EPF), Tax-Saving Fixed Deposits (FDs), National Saving Certificate (NSC), Sukanya Samriddhi Yojana (SSY), Unit Linked Insurance Plan (ULIP) additionally some nice tax saving choices.

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