Beware of your tax obligations before fiscal year ends
Read in: 1min, Published On , 5 Dec 2016 By ET Wealth
Salaried people who have tax obligations need to pay a large part of their taxes before the financial year ends. They also get the option to invest in tax savings investments and financial products to lessen their overall tax obligation. In an ideal situation, every tax payer should plan their tax savings options at the start of the year and continue through the next 12 months. However, a large number of tax payers wait till the last moment to invest in tax saving products, which could turn out to be a cause of long term botheration to them. Here are some advantages of planning to save taxes early in the year.
Starting early and sticking to a plan to invest every month helps one to become a disciplined investor
Since the total annual investment that qualifies for tax sops is divided over 12 months, it does not stretch family budget during the last few months of the fiscals
Such an approach averages out the costs of acquisition over the whole year
When one plans tax saving investments with enough time in hand, the chances of choosing a wrong investment comes down substantially (Procrastination often leads to selecting an investment product which could turn out to be a burden in the long run)
Planning and starting to invest early to save taxes also saves one from the hassle of claiming tax refunds which often take time
If one starts such investments early in the year, the person's money gets more time to grow
In case of any error relating to tax saving options and the investment products, one can get time to correct it
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