Many people want to pay less tax. The government has different plans to help save tax. These plans also give you interest on your money.
Let’s talk about some easy ways to save tax:
Public Provident Fund (PPF):
You can start with just Rs 500 and invest up to Rs 1.50 lakh a year. You need to invest for 15 years, but you can keep adding time in blocks of 5 years.
After 3 years, you can take a loan from your PPF account. Remember, you can’t close the account before 15 years, and if you don’t put money in it for a year, it freezes.
Kisan Vikas Patra (KVP):
You can invest any amount from Rs 1,000 onwards. It gives 6.9% interest, and you can invest alone or with someone else.
Only people over 18 can invest, or parents can invest for their kids. You can’t take the money out for 2.5 years. Tax benefits are available under Section 80C.
National Savings Certificate (NSC):
You can start with Rs 1,000, and it gives 6.8% interest. You get the interest once a year. There’s no maximum limit for investment.
Equity Linked Savings Scheme (ELSS):
This is a Mutual Fund scheme where you get tax benefits. You need to invest at least Rs 5,000 every month.
There’s no limit on how much you can invest. You can withdraw after 3 years. It’s not about interest but about returns based on the market.
