Kotak Life
Close

Buy a Life Insurance Plan in a few clicks

Close

Now you can buy life insurance plan online.

Kotak e-Term Plan

Kotak e-Term Plan provides a high level of protection to your loved ones in your absence. Know more

Kotak Guaranteed Savings Plan

Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality. Know more

Kotak E-Invest

Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs. Know more

Kotak Health Shield

Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability. Know more

Kotak Lifetime Income Plan

Kotak Lifetime Income Plan gives you the security of your income continuing throughout your life and in your absence throughout your spouse's lifetime! Know more

Tax Season Is Coming- Know How to Save Tax

Tax Season Is Coming- Know How to Save Tax
  • 27th Jan 2020 |
  • 3,671

With the tax season around the corner, you should start gearing up by investing in tax-saving instruments. You can find several investment options to suit your requirements like budget and risk appetite and fulfill those long-term wealth creation plans. So, let’s begin this New Year with some insightful ways of saving on taxes.

Best Ways to Save Tax

You can invest in numerous financial instruments to save tax and reduce your taxable income. But not every taxpayer iscomfortable with all the kinds of investment options available. Hence, here are some financial tools to help you save taxes as well as choose an option that suits your requirements.

1. Insurance

There are several types of insurances that you can buy to secure yourself. But the tax-saving options in insurances are life insurance, Unit-Linked Insurance Plan (ULIPs), and Health Insurance.

a. Life Insurance

Life insurance is a plan which provides you with a life cover, for example term insurance, for a fixed period of time. In return, you have to pay the premiums for the insurance policy on a regular basis. You can avail a pure life cover plan or a policy which fulfills long-term savings goal. The premiums paid towards securing insurance can be claimed under Section 80C of the Income Tax Act, 1961. Also, the death benefit can be claimed under Section 10(10D).

Invest in Term Insurance now and Save Tax

b. ULIPs

Unit-Linked Insurance Plan is a type of policy that is a mix of investment with life insurance. In this plan, some amount of the premium is invested in shares or bonds and some are used for providing a life cover. You can choose the investment option from equity or debt as per your risk appetite. You can claim income tax deductions for the premium paid under Section 80C. The maturity amount received can be also claimed for tax exemption under Section 10(10D).

c. Health Insurance

Health insurance is a policy that provides coverage on medical expenses incurred on hospitalization, treatments and other such costs. The premiums paid help in getting health insurance to avoid hefty treatment expenses and to safeguard yourself from any unfortunate incidences. Tax benefits can be claimed under Section 80D of the Income Tax Act, 1961 for the premiums paid towards the plan.

2. Investments

a. Equity-Linked Mutual Funds (ELSS)

Equity-Linked Savings Scheme is a diversified mutual fund with a lock-in period of 3 years. Through this investment, you can experience the power of compounding which ends up
giving you good returns in the future. You can get tax benefits and claim an exemption under Section 80C which has a maximum cap of INR 1,50,000.

3. Tax-Savings Fixed Deposit

a. Post Office Time Deposit

A post office time deposit is similar to a fixed deposit with a tenure that varies from 1 to 5 years. The benefit of having a TD is that even a minor can invest in this option. Contributions made towards a five year TD can be claimed under Section 80C of the Income Tax Act, 1961.

b. National Saving Certificate (NSC)

National Saving Certificate is a governmental scheme that can be availed at a post office. This investment has a lock-in period of 5 years where you can invest a minimum amount for fixed returns after maturity. You can claim tax exemption under Section 80C with a cap of INR 1,50,000 per financial year.

4. Provident Funds

a. Public Provident Fund (PPF)

PPF is an investment tool initiated by the government and has a lock-in period of 15 years. It is a lucrative option for investors looking for low-risked alternatives. You can get a dual tax benefit as the money invested in the scheme can be claimed under Section 80C and the lump sum received after maturity is also deemed as tax-free.

b. Employee Provident Fund (EPF)

EPF is an investment option for employees working in an organization. A small part of your income gets contributed towards EPF and remains exempted from tax. You can claim it under Section 80C of the Income Tax Act, 1961.

5. Loans

a. Home Loans for Construction or Buying a House

You can claim tax exemption on the repayment of the principal amount on home loan under Section 80C. Also, the interest paid on the home loan can be claimed under Section 24.

b. Home Loan for Renovation

A home loan for renovating your house also gives you tax benefits under Section 24. A maximum amount of INR 30,000 per financial year can be claimed for the interest paid on the loan.

Save Tax Now

Some Tax-Free Incomes You Should Know About

1. Agricultural Income

Income earned from agriculture is considered a tax-free income under Section 10(1). But the regular filing of Income Tax Returns should be practiced even if the earnings from agriculture are exempt from tax.

2. Interest from Savings Account

A maximum deduction of INR 10,000 can be claimed under Section 80TTA on the interest earned. For claiming the deductions, you can show the interest earned from your savings account as income from other sources while filing ITR.

3. Hindu Undivided Family (HUF) Receipts

Any money received or inherited as a member of HUF is exempt from tax and can be claimed under Section 10(2). This amount can be a family income, impartible land or income from the family estate.

4. Student Scholarships

Any student scholarship received to minimize the cost of education can be claimed under Section 10(16) for tax exemption. This benefit does not have a limit to the amount that can be claimed as tax-free income.

5. Education Loan

If you have taken an education loan for yourself or your spouse or your children, you can claim tax deductions for the repayment of the interest. This tax benefit is allowed under
Section 80E and cannot be used for claiming the repayment of the principal amount.

6. Donation

Any voluntary donations made to a religious group, governmental funds or charitable organization can be claimed under Section 80G. The claim amount for tax deductions ranges from half to full exemption.

Kotak e-Term Plan

Features

  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

How to Compare Term Insurance Online

Importance of Term Insurance at Every Stage of Your Life

What is Critical Illness Policy

Why Term Insurance Is Important in times of COVID-19?

What Types of Deaths Are Covered in a Term Insurance Plan?

10-Year Term Life Insurance Policy - Explained in Detail

Best Investment Plans for Children - Secure Your Child's Future

Term Insurance: What Happens When You Don’t Pay Your Premiums?

How Does Term Life Insurance Work? Learn the Benefits

Do I Need to Give a Medical Test for Term Insurance in India?

Tips to Choose the Right Term Period for Term Insurance Plan

How To Calculate The Amount Of Term Life Insurance You Need?

Make Your Online Term Plan Your Family's Monthly Pay Cheque

Should You Have Multiple Term Life Insurance Policies?

What Is a Passive Income? Why Should You Use It to Buy a Term Plan?

Can I Buy Term Insurance for a COVID-19 Patient?

Everything About Claim Settlement Ratio for Term Insurance

How Does A Term Life Insurance Work in India?

Why Should You Add a Rider to a Term Insurance Plan?

Difference between Term Insurance and Life Insurance

Why 1 Cr Term Plan Is Necessary For Family?

6 Types of Death not covered in Term Insurance Plan

Why Should You Not Take A Term Plan Without Medical Test in India?

Why does every working woman need life insurance?

Why Buy Term Insurance Even at Rising Rates?

Term Insurance Calculator - Everythng You Need To Know

Advantages of Buying Term Insurance in Your 50s

What Are Insurance Riders and How to Choose Them in a Term Plan?

How To Choose the Right Term Insurance Plan?

Insuring Protection Against Death With Death Insurance Rider

Busting Myths and Facts About Term Insurance Policies

Online vs Offline Term Insurance: Which Is The Better Option To Buy

How To Change The Nominee in Term Insurance?

Steps on How to Buy Term Insurance Online

Term Insurance – Why You Must Include In Your Financial Planning?

What All Documents Required For Term Insurance In India?

Do Beneficiaries Pay Taxes on Term Insurance?

Term Insurance: Most Common Term Insurance Myths Explained | Kotak Life

Comparing Term Plans – What Should You Look Out For

Can Senior Citizens Avail Term Insurance?

Why Married People Should Buy Term Insurance Under MWP Act?

Ensure Protection Against Death, Disease & Disability With Life Insurance

How to Buy 1 Crore Life Insurance Policy Without Medical Test

Know How to Invest at Every Age for Larger Returns

How to Ensure That Your Term Insurance Claims Are Never Rejected?

What Happens to Term Insurance Plan With No Beneficiary - Kotak Life

Should Youngsters, Working Couples Buy Term Insurance Plans?

What Is a Renewable Term Insurance Policy?

Can You Increase Your Term Insurance Cover?

Term Insurance Plans and Policies for Smokers

Cost of Term Insurance Likely to Increase Soon

Buying A Term Insurance? Don't Ignore the Claims Settlement Ratio

Term Insurance with Critical Illness

What Happens if you Hide Facts in your Term Insurance?

How to Surrender Term Life Insurance When you have No Liabilities

Planning For Son or Daughter's Wedding

Why is it important to buy term insurance plan?

8 Benefits of Term Insurance You Should Know

Calculating Term Insurance Premium

टर्म इंश्योरेंस क्या है? टर्म इंश्योरेंस का मतलब

Term Insurance Age Limit – Term Plan for All Age Groups

Is a Term Insurance Policy Portable?

What is Form 16, Form 16 part A, Form 16 part B, Information Required and FAQs

Insuring Against Disability With Disability Insurance Rider

Insuring yourself against Ill Health with a Critical Illness Rider

Buying A Term Insurance Plan? Take These Factors into Account

How Much Term Insurance Do I Need

Is There Any Tax Benefit on Term Insurance?

Gift Your Father A Term Insurance Plan This Father's Day

Why Should New Parents Buy Term Life Insurance?

Ideal Features of a Suitable Term Plan - Act Now for a Stress-free Future

Which Term Insurance to Choose: Lump Sum or Staggered Pay-out Plan?

Why Term Insurance Is Better Than ULIP?

Is Term Life Insurance Plan an Investment or Expense?

Is Group Term Life Insurance Provided By Employer Sufficient?

4 Reasons Why You Need Critical Illness Cover

Does Term Insurance Cover Accidental Death?

9 Ways to Help Family Members in Financial Trouble

What are incremental term insurance plans?

Insurance Policy for Housewife In India

Make Your Online Term Plan Your Familys Monthly Payout

Why should single women purchase term life insurance?

Why Surrendering Your Term Plan Policy In The Final Phase Maybe A Bad Idea?

All About Term Insurance Inbuilt Coverage

When is the Right Time to Buy Term Life Insurance Policy for Yourself?

While Buying Term Insurance Compare Features, Not Just Premiums

Can I Extend the Tenure of My Term Insurance Plan?

What is a Joint Term Insurance Plan? Key Benefits of Joint Term Plan

4 Methods to Calculate How Much Term Insurance You Need

4 Things To Expect From Your Term Insurance Plan in India

Can Term Insurance Plans Be Purchased As A Gift?

What Are the Best Term Insurance Plans for Planning Retirement?

How Not To Get Your Term Insurance Claim Rejected

How to Identify Term Insurance According to Your Needs?

What is the Right Term Period For Term Insurance Policy? Here's How You Should Choose!

Increasing Term Insurance and Riders

5 Reasons to Buy Term Insurance When You are in Your 30s

Term Life Insurance Plan for Smokers vs Non-Smokers

Is Life Insurance Investment Worthy Enough

What is Term Insurance - A Complete Guide

Tax Benefits of Term Insurance in India

Can I Get Term Insurance on Behalf of My Spouse?

Individual Life Insurance vs. Group Term Life Insurance

Can Non-Resident Indians (NRIs) Buy Term Insurance In India?

What Is the Correct Age to Buy Term Insurance?

9 Most Frequently Asked Questions on Term Insurance

Key IRDAI Regulations That Changed Face Of Term Insurance Industry In 2020

Planning For Children's Future

5 Things To Consider While Buying Term Insurance Plan

6 Reasons That Make Term Insurance a Must Buy

Why Buying a Term Plan Is Smarter Than Traditional Life Insurance Products

Insuring Against Accidents with an Accidental Death Insurance Rider

Does Your Term Insurance Plan Cover Death Due to COVID-19?

Is term Insurance Needed for People With No Dependents?

Are The Add-ons and Optional Features of Term Insurance Plans Actually Beneficial?

Can A Housewife Buy a Term Insurance Plan - All You Need to Know

Different Types of Protection Plans

Is It Good To Buy A Term Insurance Plan In 2022?

8 Factors to consider before choosing a Critical Illness Insurance

Term Plan with Spouse Cover

5 Term Insurance Benefits for Single Women

All you need to Know about Term Insurance Plans for Housewives

Is ₹1 Crore Term Insurance Good Enough Cover?

Why Term Plan Should Be The First Step To Securing Your Future?

Term Insurance Basics You Should Know

How To Choose the Right Sum Assured Under a Term Plan?

What Should Be The Duration Of Your Term Plan in India?

Which Death Type Does Your Term Plan Not Cover?

Term Insurance With Riders In India

Can I Make Changes to My Term Insurance Policy Post Purchase?

What Should You opt for - Limited or Premium Pay?

Do You Need Term Insurance Cover After Retirement?

5 Benefits of Early Retirement Planning

Is it a Good Time to Buy Term Insurance During the COVID-19 Pandemic?

How Much Cover Should I Take In A Term Plan?

What is Insurance Premium - A Detailed Guide

Term Vs. Whole Life Insurance: Which One You Should Buy in India?

Understanding Term Insurance Riders

Eligibility Criteria for Buying Term Insurance in India

Reasons You Need Term Insurance Plan as a Self-Employed Person

Why Should You Buy Term Insurance in 2022?

Top 3 Reasons Why You Should Buy A Term Plan Now

Why Premium Amount for Term Insurance is So Low?

Protection for your family

Advantages & Disadvantages of Term Insurance in India

Why Buy Term Insurance Plan With a High Cover?

How Much Term Life Insurance Cover Do I Need in India?

Endowment Plans vs Term Plans: Understanding the difference

Term Insurance: Smokers vs Non-Smokers

What is a short term insurance policy?

8 Things To Do After Buying Term Insurance

Different Types of Premium in Term Insurance

Should You Buy a Term Plan After 40?

Term Plans are Definitely Cheaper than You Think!

What are the Documents Required for Term Insurance Plan?

Choosing Riders for Insurance Plans

Key Differences Between Term Insurance, ULIPs, And Health Insurance