With the financial year coming close to end, it is time to start end of the year tax preparations so that you do not have to pay a heavy tax bill in April. It is a legal obligation for every individual to file a return of income if their fall under any of the tax brackets. Besides filing the return, one has to arrange all the documents like investment proofs, etc based on which the tax is computed. Although the income tax department does not require submitting any supporting documents along with the return of income but it is always better to be prepared with all the documents in order to avoid any hassles in the future.
These are few things that should be implemented before the financial year ends on March 31st:
1. In order to avail the deduction under Section 80 C of the Income Tax Act, you should submit the proof of all your relevant investments and expenses to your employer. These documents would include receipt for insurance premium paid, deposits made in your public provident fund account, investment made in equity-linked savings schemes, National Savings Certificates purchased, tuition fees of the children, home loan EMIs paid and others. A documentary proof of your investment and expenses would be required by your employer to give you deductions under Sec 80 C.
2. In case you have changed your employment during the financial year and have not yet collected Form 16 then you should immediately get one. It is the Certificate of tax deducted at source to be given by the employer to the employees in respect of salary paid and tax deducted during for the preceding financial year ended March 31st.
3. Make sure you have collected all your bank statements and Tax Deducted at Source (TDS) certificates from your bank. This will enable you to evaluate the interest income on your bank deposits and pay the tax for the balance amount.