The start of a new financial year provides an opportunity for taxpayers to realign their financial strategies. With the Income Tax Act, 2025 coming into force from April 1, many regulatory changes have also been made. If tax payers do proper planning from the beginning, they can avoid any kind of difficulties later.
By taking right decisions at the right time, one can not only save tax but also have better financial management. Come, let’s take a look at some of these special things…
1. Choose the right tax option right from the start
While tax planning, the most important decision is to choose the right tax system. Currently, the new tax system has been set as the default option; Although the exemptions are less, its tax structure is easier. On the contrary, if you want to avail benefits like House Rent Allowance (HRA), deductions under Section 80C, health insurance benefits, or exemption on home loan interest, the old tax system may prove more beneficial to you. Therefore, it is advisable that you calculate your annual income and potential deductions in advance to decide which option best suits your specific needs. This way of preparing in advance can help you save a lot of money.
2. It is very important to submit Form 12BB on time
For salaried employees, it is very important to submit Form 12BB on time. This form is a way to tell your employer about your various expenses and the deductions you are eligible for. This includes information like rent payment, insurance premium, and interest paid on home loan. If this information is submitted at the beginning of the financial year itself, the employer can deduct the correct amount of Tax Deducted at Source (TDS) every month based on the information provided. This saves you from the trouble of deducting excess tax and difficulties in getting refund later.
3. Right time to start investing
Instead of waiting till the end of the financial year, it is more beneficial to plan your investments from the beginning. As early as April, you can start considering different investment avenues under Section 80C—such as Public Provident Fund (PPF), Equity Linked Savings Schemes (ELSS), Life Insurance, and Employees’ Provident Fund (EPF). Additionally, you can gradually start investing in health insurance plans under Section 80D and contribute to the National Pension System (NPS). Doing this starts your investment journey right from the beginning of the year and helps you avoid last-minute mistakes.
4. Keep documents and details updated
For tax related matters, it is important that your PAN and Aadhaar are linked. Additionally, your bank account details must be accurately updated with the Income Tax Department. Also, your mobile number and email ID should also be correct, so that you get timely notifications regarding notices or refunds. It is also very important to review your nominee’s details from time to time; If any changes are necessary, make sure they are updated accordingly.
5. Keep an eye on capital gains
In the new financial year, it is very important to keep a record of your profits throughout the year. So, keep detailed records of all your assets—like shares, mutual funds, properties and bonds. Whether short-term or long-term Capital Gains Tax will be applicable on an investment depends on the time of its buying and selling. By having this information from the beginning, you significantly reduce the room for mistakes.