Tax Saving through EEE schemes: Be it a millionaire or a salaried employee, everyone wants to save tax. This is the reason why everyone wants to invest money in such a scheme where he or she not only gets good returns but also gets tax exemption. People keep looking for ways to save income tax. If you are also looking for a way to save tax, then you should invest money in schemes falling in the EEE category. Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), Equity Linked Savings Scheme (ELSS) and Employee Provident Plan (EPF) are the savings schemes falling in the EEE category. These schemes save tax in three ways. If you invest in any of these schemes, you will get tax exemption on the amount deposited in a year. There will be no tax on the interest received on the invested money and the entire amount received at the time of maturity will also be tax-free.
EEE means Exempt, Exempt, Exempt! There are three ways in which tax is saved in the schemes falling in this category. In this, there is no tax on the amount deposited every year, apart from this, there is no tax on the interest earned every year and the entire amount received at the time of maturity is also tax-free i.e. investment, interest/return and maturity are tax-free.
Public Provident Fund (PPF)
PPF is a better option to save tax and invest in a safe place. Under this scheme, any investor can deposit a minimum of Rs 500 and a maximum of Rs 1.5 lakh in a year. Annual interest of 7.1 per cent is available on PPF. The special thing about this scheme is that the investment money, interest received on the investment money and maturity amount are all tax-free.
Sukanya Samriddhi Yojana (SSY)
Under this scheme, the investor gets 8.2 per cent interest. Under this scheme, any parent can deposit Rs 250 to Rs 1.5 lakh annually in his or her daughter's account. The money is deposited for 15 years and when the daughter turns 21, the entire amount along with interest is returned to the investor. To invest in this, the daughter's age should be less than 10 years.
Equity Linked Savings Scheme (ELSS)
Equity Linked Savings Scheme (ELSS) is also called tax saving mutual funds. In equity-linked saving schemes, you can deposit money in a lump sum and can also do it through SIP. Its lock-in is for three years. After this, you can withdraw money whenever you want or continue your investment. If you withdraw the amount after 3 years, you get tax benefits.
Employee Provident Plan (EPF)
If you are employed then you can also save your tax through EPF. EPF is also an EEE category scheme. At present 8.25 per cent interest is given to it. In such a situation, you can add a good amount of money through this scheme. If you want, you can also increase your contribution through VPF.
