Despite all the planning and Investments, a majior portion of our salaries continue to be deducted from our salaries towards taxes. Some of us might be eligible for a tax refund and some might not.
What is a Tax Refund?
Next time, one of your collegues boasts of getting a refund, it doesn”™t necessarily mean that he has done his taxes better than you. In fact, he might have filed for a tax refund either because he has not planned his taxes well or because he has failed to disclose his tax saving investments to your company ( employer ). But there is a better way: Walk into your nearest reach tax branch (http://reachtax.com/branch-close-to-you.html), Discuss your tax situation with a tax expert to adjust your tax deduction to more closely match what you’ll owe the government. Then tell your employer how much of your salary NOT to tax during the year, thanks to exemptions, deductions, tax credits and other perfectly legal ways to hold down your tax deductions.
On what basis does the employer deduct taxes?
The government has asked your employer to calculate your tax liability for the year in advance and deduct the tax due from your salary in equal instalments and remit it to the government on your behalf. However your employer may not be aware of your tax saving investments and tax saving investments unless you tell him. He might continue to deduct taxes at taxes he has calculated at the beginning of the year without considering your tax planning options. So how much your employer will deduct depends on two things 1. How much you earn, 2. What information you provide to your employer.
The Form 16
You get a Form ”“ 16 at the end of the year. It clearly shows what taxes has been deducted from your salary during the year. After reciving your form-16, it might be too late for planning. However you can claim for a tax refund, if you have made any investments or expenses which qualify for a tax deduction.
How to reduce your Tax deductions?
1. Walk into one of the Reach Tax branches (http://reachtax.com/branch-close-to-you.html)
2. Discuss your tax situation with a tax expert.
3. Invest or save expense bills requested by the tax expert.
4. Inform your employer about your tax saving plan
5. That”™s it. See how much you can save this way! Good luck!