It is common for most of us to rush through the income tax filing process towards the end of the financial year, ensuing hasty and suboptimal choices. However, by planning our taxes in the first quarter of the financial year, we are more likely to enjoy a smoother, stress-free year-end. Tax planning isn't just for men; it's equally crucial for working women. This simple yet thoughtful approach ensures that your financial journey is well-ordered and beneficial in the long run.
Also Read: Income Tax: Filing ITR early this time? Here are 8 key strategies to optimise tax savings
A housewife is required to file an income tax return if she earns income from any source, such as interest, dividends, or tuition, and this income exceeds the basic exemption limit. Under the old tax regime, the exemption limit is Rs. 2,50,000, while this is Rs. 3,00,000 under the new tax regime.
Also Read: Income Tax: Make note of these 5 key points if you are a salaried taxpayer
Understanding income tax slab for FY 2023-24
Before diving into specific schemes, it’s essential to know that the tax slabs that apply to women are the same as what apply to men. Knowing where you stand can help in better planning and maximising your savings.
Income Slab (Rs) | Old Tax Regime | New tax Regime (until 31st March 2023) | New Tax Regime (From 1st April 2023) |
---|---|---|---|
0 - 2,50,000 | - | - | - |
2,50,000 - 3,00,000 | 5% | 5% | - |
3,00,000 - 5,00,000 | 5% | 5% | 5% |
25,00,000 - 6,00,000 | 20% | 10% | 5% |
6,00,000 - 7,50,000 | 20% | 10% | 10% |
7,50,000 - ₹9,00,000 | 20% | 15% | 10% |
9,00,000 - 10,00,000 | 20% | 15% | 15% |
10,00,000 - 12,00,000 | 30% | 20% | 15% |
12,00,000 - 12,50,000 | 30% | 20% | 20% |
12,50,000 - ₹15,00,000 | 30% | 25% | 20% |
>15,00,000 | 30% | 30% | 30% |
Let’s explore some effective tax-saving options tailored for women:
It is a government-backed savings scheme designed specifically for the girl child, encouraging parents to save for their daughter's education and marriage expenses. The SSY falls under the EEE (exempt, exempt, exempt) tax category. This means you won't have to pay taxes on investments, earnings, or withdrawals. If you have a daughter, this scheme is considered quite beneficial and rewarding.
Tax exemption is provided under Section 10 (11A) of the Income Tax Act, 1961, and investments made in the SSY scheme are eligible for a deduction under Section 80C, with a maximum limit of ₹1.5 lakh.
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It is a fixed income investment scheme available at post offices. You can start with a minimum deposit of ₹1000, and currently, the scheme offers a guaranteed return of 7.7%. Under Section 80C of the IT Act, you can claim a deduction on any amount paid or deposited towards the National Savings Certificate, with a maximum limit of ₹1.5 lakh.
PPF is ideal for those looking to invest for the long term. You can open a PPF account with a minimum deposit of ₹500, and the maximum annual contribution is ₹1.5 lakh. The PPF offers a secure way to build a substantial corpus over time with attractive interest rates and tax benefits.
Also Read: Income Tax Return: 8 common mistakes to avoid for a flawless income tax filing
Women can also avail tax benefits on life insurance policies taken for themselves, their spouse, or their child. The deductions, however, cannot exceed 10% of the sum insured for a normal person and 15% for a person with certain specified diseases under Section 80U of the Income Tax Act. This makes insurance not only a protective measure but also a smart tax-saving tool.
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