Tax planning tips for different age groups and various income slabs

 
Tax planning is one of the most important aspects of personal finance. People often fail to look at tax planning objectively and straight away start making investments related to tax saving. Also they often tend to mix tax planning and investment planning, which are totally different and are made with varying objective.
Insurance for long has been the front-runner whenever investments regarding tax savings are considered. Life insurance is not an investment option but a financial tool, which protects from any unforeseen eventualities. Buying excessive insurance however leads to holding unnecessary products.
Savings under section 80C can be broadly classified as investment based and non-investment based.
Provident Fund (PF), Public Provident Fund (PPF), Employees' Provident Fund (EPF), National Savings Certificates (NSC), National Pension System (NPS), Fixed deposit (FD) and Equity Linked Savings Scheme (ELSS)come are investment based savings; while principal repayment of home loan, tuition fee are non-investment based.
Before making investments related to tax saving it is always important that the individuals must analyse their risk appetite, and determine the percentage of debt and equity exposure they are comfortable with. Then they can match these percentages of debt and equity while investing in the available tax saving investments.
Since the risk appetite, liquidity needs and current portfolio of every individual are different, making investments based on just returns is not advisable.
TAX PLANNING AGE-WISE
23-30
This is generally starting phase of the career for most of the professionals, and therefore is the right time to start saving for the future. The investments made during this phase should have a long-term investment horizon. Starting to save and investing for retirement will give an edge if started at early age because of power of compounding.
Investing in a mix of ELSS and pension-related schemes like EPF, NPS or EPF is a good option for professionals of this age group. By doing so, they ensure that they plan for their retirement from an early age. It also provides the advantage of providing equity exposure to their retirement fund.
It is also advisable for the professionals of this age group to get required life insurance cover and health insurance cover. They can take the advantage of low premium rates if they start during this age. Avoid falling in the trap of endowment plans and unit linked insurance plans.

Indirect tax collections up 5.1 pc in Apr-Sept

 
Indirect tax collections grew by 5.1 per cent in the April-September period of this fiscal, a finance ministry official said.

Total collection of indirect taxes - excise, customs and service tax - stood at about Rs 2,28,550 crore during the first six months of 2013-14, the official said.

Excise collection dropped 6 per cent during the period to over Rs 89,000 crore, against the same period in the last fiscal year, reflecting slump in manufacturing activity.

Customs mop up was up 10 per cent to Rs 80,550 crore during the period, the official said.

Service tax collection, which has become a new focus area for revenue officials, grew by 16 per cent to Rs 59,000 crore during the period.

In September, total indirect tax collection stood at Rs 42,700 crore, up 13 per cent from the same month last year.

Government has set indirect tax collection target of Rs 5.65 lakh crore for 2013-14, up from Rs 4.73 lakh crore in the last fiscal.