Home Blog 7 Tax Tips For The Unemployed During The COVID-19 Pandemic

7 Tax Tips For The Unemployed During The COVID-19 Pandemic

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tax tips unemployment
tax tips unemployment

Apart from the tax Act Section 80C, there are many other tax Acts during which tax is exempted in some ways. Today we are going to tell you about some Best 7 Tax tips for unemployment during the Covid-19 Pandemic.

People earn money by working hard, but when this money is deducted from your salary at the top of the year as tax. So this is often certainly the most painful moment. Everyone wants his tax to be minimized but taxpayers often don’t know enough about other options.

Salary restructuring

It is not always possible to spend your salary. But if your company allows this, and you’ve got good relations together with your HR, then a number of your salary could also be reduced by the tax. Take food coupons rather than lunch allowances, this provides you a tax rebate of up to Rs 60,000. Tax tips for unemployment.

Allow Medical Allowances, Transport Allowances, Education Allowances, Uniform Allowances (if any), and Telephone Expenses to stay in salary, and show the right bill for these in order that they will be tax deducted. Not only this, use a corporation car rather than your car to avoid paying more tax.

Use Section 80C

Use Section 80C the maximum amount as you will because, under this, you will get tax write-off of up to Rs 1,00,000 to get good use of this stream, invest in these options. Public Provident Fund, life assurance Premium, National Savings Certificate, Equity Linked Savings Scheme, Fixed Deposit in Banks and Post Office for five years 2 Paying tuition fees for children’s education

Other options aside from 80C

If your amount is functioning from one lakh rupees, then there are other options aside from Section 80C. Section 80D – Medical insurance of Rs 15,000 is going to be deducted for a self, spouse, and dependent children and Rs 20,000 for medical parents above 65 years aged. Under section 80C you can invest under an infrastructure bond and Section 80 CCF-A under 1 lakh deduction of Rs. 20,000.

Apartment rent

Are you getting HRA from the company and by your own you are paying your house rent? So here are some options that you simply can cash in of under Section 80GG. 25% of the entire income, or Rs 2,000 per month, or pay quite 10% of the entire income added to the rent if you reside together with your spouse and minor child and therefore the house you reside in is yours and there. If you are doing all the work in your office, then there’ll be no deduction of any kind from your salary. Tax tips for unemployment

If HRA’s structure a part of your salary, you will get minimum exemption within the three below. the present HRA that you simply will get from your boss, the present rent of the house you’ll pay, this includes a tenth salary reduction.

tax tips unemployment
Asian man unemployed Photo credits katemangostar

Save Tax on Home Loans

Use your home equity credit properly in order that you will save more tax. Under 80C with deduction of Rs.1,00,000 as the principal of your loan falls. Not only this, under Section 24, but there’s also a deduction of 1, 50,000 in interest separately.

Travel Leave Allowance:

Use a travel leave allowance for your holidays, which you’ll get twice in four years. If you’ve not taken advantage of them in these four years, then you’ll take a vacation now. With this, you’ll cash in of the subsequent three.

Tax on Bonus

The bonus you get from the boss is totally taxable the year you bought it. Therefore, request your boss that if the rate is reduced now or within the coming year. Also, see that you simply can increase your bonus for the subsequent year. Provide all the knowledge associated with your tax to your boss in order that no tax is levied on him while giving a bonus. Tax tips for unemployment

Conclusion:

To avoid the hassles of tax planning at the last minute keep a number of the subsequent points in mind. To avoid any unnecessary deduction, inform your financial planner about investing altogether loans and tax-saving investments. And it’s important that each year you begin your tax planning before 31 March and file all of your returns by 31 July.