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Going for new tax regime? Here's what is good for taxpayers

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Public Provident Fund: Continue investing to build tax-free entity

While many investment options have moved into the tax slab, the PPF has remained tax-free. This scheme is a good way to build a retirement plan that earns tax-free interest.

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Term insurance: Continue making payments for protection

Buying life insurance is not to save tax but is meant to provide financial support if the policyholder dies.

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Pay for the medical insurance to cover irrespective of tax benefit

Do not stop paying for your medical cover as there is no deduction for the premium. The recent COVID-19 showed the absence of medical insurance can ruin a household's finances.

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Be advised to invest under sections that offer tax benefits

Continue making contributions to the plan if you chose to participate in the NPS through your workplace in order to receive the tax advantage.

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Avoid SIPs and move to regular funds

You can invest in a conventional equity diversified fund as opposed to a fund with a three-year lock-in term.

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Avoid locking money in illiquid options

These fixed income investments now have higher interest rates than they did previously. Nevertheless, because they offer little liquidity, they should be avoided.

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