RESUME APPLICATION PAY PREMIUM
Fund Performance

Fund Performance

Knowledge Center

Knowledge Center

About Us

About Us

Tools and Calculators

Tools & Calculators

Quick links

Mobile (Download app)
  • Webpages
  • Documents
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment

For NRI Customers

(To Buy a Policy)

(If you're our existing customer)

For Online Policy Purchase

(New and Ongoing Applications)

Branch Locator

For Existing Customers

(Issued Policy)

Fund Performance Check

RESUME APPLICATION PAY PREMIUM

What do you want to do?

Quick links

Mobile (Download app)

Download HDFC Life App

Buy plans, track your policy, make renewal payments & monitor fund performance with HDFC Life App, Download Now!

Apple Logo Go to Google Play Store

Five mistakes you must avoid while investing to save income tax

down-arrow
5 mistakes you must avoid while investing to save income tax
March 16, 2019

Table of Content

 

In Indian taxation system, income tax is one of the main types of direct taxes levied by the government. It is the tax that is levied under the regulatory guidelines of CBDT (Central Board of Direct Taxes), and is imposed by the government on income generated by businesses and individuals (including HUFs or Hindu Undivided Families) within their jurisdiction. An income tax is therefore the tax that is levied on the earnest monthly salary and it varies from one taxable slab to another. Section 80C of the Income Tax Act, 1961 allows exemptions for various investments which people undertake for saving on taxes. However, while planning to invest in order to save payable income tax, there are certain common mistakes, which must be avoided. Following is a list of these mistakes that you must avoid while investing to save income tax:

1.Ignoring your specific needs and requirements:

This is one of the most common mistakes that many people make. Before making any investment decision, you must make a list of your specific needs and requirements so that the right kind of matched decisions can be taken. Therefore, it is important to not follow what the others are doing but to take care of your own financial aspirations.

2.Not choosing the right amount of investment:

Underinvestment and overinvestment are both factors that you must avoid. The amount that you to choose to invest obviously depends on the earnest monthly income. Therefore, if you choose to invest in a particular instrument, you must do so after taking due care of meeting your needs and that of your loved ones. After doing that, the surplus amount must then be invested. However, investing the surplus completely must be avoided because you have to contribute towards the basic savings corpus as well as keep emergency funds available.

3.Not exploring all options:

Sections 80C, 80G, 80D and 80CCD are various sections that offer exemptions on options that range from investments in health insurance to contributions towards certain charitable or other institutions. Therefore, you must have a clear understanding of the legal Sections under which exemptions are being offered so that you can have a better grasp of the available options.

4.Lop-sided investment portfolio:

The ideal investment portfolio must consist of both the debt and equity instruments and even hybrid instruments. This ensures stable benefits over a period of time and ensures that all your funds are not tied up in a single investment option.

5.Not taking due care of present commitments:

This means that if you have invested more than the surplus, then the present day commitments or immediate financial goals may not be duly met. Therefore, it is important that you take due care of present commitments while planning your long term investments.

HDFC Life offers several saving and investment plans that allow you to maintain security of the finances and offer market-linked returns and capital benefits.

Plan Income tax

Term Plan Articles Term Plan Articles

Investment Articles Investment Articles

Savings Articles Savings Articles

Life Insurance Articles Life Insurance Articles

Tax Articles Tax Articles

Retirement Articles Retirement Articles

ULIP Articles ULIP Articles

Health Plans Articles Health Plans Articles

Child Plans Articles Child Plans Articles

Popular Calculators Popular Calculators

Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

LinkedIn profile
Author Profile Written By:
Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

LinkedIn profile
Reviewed By Reviewed By:

Here's all you should know about life insurance.

We help you to make informed insurance decisions for a lifetime.

Income Tax Slab FY 2024-25 and AY 2025-26

Income Tax Slab FY 2024-25 and AY 2025-26

The latest income tax slabs for FY 2024-25 and AY 2025-26, including new and old regime rates, deductions, key highlights for smart tax planning, and savings tips.

Tax Planning for Salaried Employees: Key Pointers to Consider

Income Tax Saving Tips for Young Earners

What is Tax Declaration Form? - Process to File Income Tax Declaration

Investment declaration has to be done in the beginning of a financial year. Read to know what is form 12BB & the step by step process to declare investments!

What is Tax Declaration Form? - Process to File Income Tax Declaration
Tax Saving- Compare top 10 tax saving instruments in India under section 80C Previous
Tax efficient Mutual Funds - why SIP helps Next
HDFC life
HDFC life

HDFC Life

Reviewed by Life Insurance Experts

HDFC LIFE IS A TRUSTED LIFE INSURANCE PARTNER

We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.

Popular Search

Popular Searches