How to Save Income Tax with PPF

The PPF which is commonly known as the Public Provident Fund has been branded as the most efficient tax saving plan in India under the government policies. Every individual vouches on this plan. It is a fully government operated scheme. Few of its unique beneficial features give it the popularity among all the ages. So here are the features of this tax saving instrument moneywise.

• The Investment limit:

The investment amount is very flexible and makes it easy for every policyholder to invest according to their need and also income. The minimum investment starts from the nominal amount of 500 Rs. and maximizing to 1, 00,000 Rs so that you can select as per your comfort.

• Safety Confirmation:

It is a very safe investment plan as the bank takes the responsibility to process the plan and the money is safely kept with the government of India.  And the defaulting chance of the government towards your investments is very low.

• Tax saving:

As this falls under the section 80c so tax will be saved without doubt. The other features it provides that the interest amount which is paid is fully tax free and also the redemption amount which is the insurance maturity amount is also saved. 

• The Interest Rates (returns):

The return it gives is quite good. The interest rate for the recent year is up to 8.7% scoring high on all the parameters. The bond yield system has always been a benchmark in the market so linking its interest rate to this has made the Public Provident Fund a more attractive to the investors.

• The Locking Period:

The total period of the PPF is 15 years in tenure and this lock in period give a benefit in tax rebate too. Also, during this period, you cannot close your account except in exceptional cases of death. This could be increased by 5 years any time which gives you flexibility unlike most of the insurance plans. In fact many of the insurance plans do not offer good surrender value on surrendering policy.

Therefore, investing in any PPF scheme is very beneficial as it helps you in saving tax easily. For example your income which falls under the tax slab is Rs 4 lacs. Now, you have invested in Public provident fund (PPF) scheme RS 70,000 which is the maximum exemption limit for tax. So, automatically, the taxable income goes down to Rs 3, 30,000. Therefore, now you will be liable to pay a tax not for Rs 4 lacs but for Rs 3 lacs 30 thousand.

This is the best way of saving tax as well as securing your future by making a safe investment.

New Jeevan Anand policy:- 

LIC of India has introduced New Jeevan Anand policy with slightly changed features in previous jeevan Anand policy by adding a term ‘‘new”. It is a modified plan of the old Jeevan Anand. All age group people can take this policy. Policy holder will get financial protection against death throughout lifetime validity. A mixture of endowment policy plus whole LIC New Jeevan Anand Policy 915. Under this policy LIC has made an arrangement of Loan facility, Risk coverage till the end of policy term. Other eye catching features of this policy are Accidental death and Disability rider. Go for it!