Income taxpayers frequently invest in specific products, such as life insurance policies, SIPs, ULIPs, NPSs, ELSSs, PPFs, and NSCs, to lower their taxable income. About 5.83 billion people in India are required to file a tax return each year. Income taxpayers can choose between the previous tax system and the current system. Although one can seek deductions under numerous sections in the old tax regime, one cannot under the new one, hence the former has the advantage in terms of lowering one’s tax burden.
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When trying to lower their taxable income, people frequently invest in tax-deferred instruments. Life insurance policies, systematic investment plans, unit-linked insurance policies, the new pension scheme, the equity-linked tax savings scheme, the public provident fund, national savings certificates, and the like are all examples of such financial products. Each financial instrument carries its own set of risks and interest rates.
Eligible individuals include Seniors (0.5%), Current Employees (1.0%), and Former Employees (1.0%). Now under the Canara Tax Saver Deposit plan, senior citizens are qualified for an interest rate that is one per cent higher than the standard interest rate.
In this plan, you can put away up to Rs 1.5 lakh, and if you’re eligible, you can get a tax break per Section 80C of the Income Tax Act of 1961.
Canara Bank offers a Tax Saver Scheme as one such tool. The salaried, commercial and professional classes would benefit most from the Canara Bank Tax Saver scheme, which is a fixed deposit term deposit scheme. This risk-free fund from the bank comes with a lock-in term of five years and a rate of interest of 7%.