The deadline for filing your income tax return for the financial year 2022-2023 is approaching fast, with only two days remaining until 31st July 2023. After this date, late fees will apply. Currently, over 4.5 crore returns have been filed, with 7 percent being first-time filers. Utilizing various tax exemptions and deductions can significantly reduce your taxable income, providing you with an opportunity to optimize your tax liabilities. In this article, we will discuss essential tax-saving options and common mistakes to avoid while filing your income tax return for the current financial year.
Tax Exemptions and Deductions:
Besides the well-known tax-saving options under Section 80C, there are numerous other avenues to reduce your tax liability. Some crucial exemptions and deductions are as follows:
- National Pension Scheme (NPS): Taxpayers can invest up to Rs 50,000 in NPS under Section 80CCD(1B).
- Savings Account Interest: Section 80TTA allows a deduction of up to Rs 10,000 on interest earned from a savings account.
- Senior Citizens: Individuals above 60 years can claim up to Rs 50,000 as a deduction on savings account interest under Section 80TTB.
- Education Loan: Section 80E provides a deduction on the interest paid on education loans for self, spouse, children, or wards.
- Donation: Donations made to specified funds, such as the Prime Minister’s Relief Fund, can offer full or 50 percent deduction under Section 80G.
- Preventive health check-up: Under Section 80D, a person can claim a benefit of up to Rs 5,000 on preventive health check-up for self, children, spouse or parents below 60 years.
Mistakes to Avoid:
Filing income tax returns has become more accessible with online platforms, but mistakes can still lead to department notices. Common errors to avoid include:
- Incorrect Information: Be meticulous in providing general details such as PAN number, date of birth, address, and bank account information to avoid discrepancies.
- Complete Income Reporting: Ensure all taxable and tax-exempt income, including interest from savings accounts, shares, and mutual funds, are accurately reported.
- Match with Form 26AS and AIS: Cross-check details from Form 26AS and AIS TIM to avoid computation errors and penalties due to mismatch.
Conclusion: With just 3 days left to file your income tax return for FY 2022-2023, act promptly to avoid late fees. Take advantage of available tax exemptions and deductions to reduce your taxable income effectively. Stay cautious and provide accurate information to avoid receiving notices from the income tax department. By adhering to these guidelines, you can successfully file your income tax return and fulfill your tax obligations responsibly.
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