ACKNOWLEDGEMENT

I wish to express my sincere gratitude to the Principal, <Principal Name>, <College Name>

I sincerely acknowledge my heartfelt thanks to <Professor Name> Associate professor

and Head for <his/her> continuous encouragement and guidance.

I wish to extend my sincere thanks to <Professor Name> Assistant professor, for

<his/her> support throughout the course.

I also wish to extend my thanks to <Trainer Name> –Trainer, TNSADC for <his/her>
valuable guidance and support in completing this project.
 CONTENTS

S. No. Particulars Page No.

1. 2
Introduction

2. 3
How to choose a Tax
Saving Investment

3. 6
Tax Slabs (FY2019-20)

4. 7
Tips on Tax Planning

5. 10
Important Tax Sections
for Salaried Individuals
6. 13
Disclaimers
 1. Introduction to Tax Saving
Congratulations on the wise decision you’ve taken to invest to save on your yearly
taxes. This guide has been prepared keeping in mind the need for concise and clear advice
about tax saving. This would help you do the following

a) Understand how to evaluate a tax saving investment

b) Calculate your tax liability

c) Know about individual sections which can help you save tax

d) Plan your tax saving investments

e) Invest online

This guide would come handy for anyone looking to invest to save tax and is new to the
exercise. It would also help salaried individuals who are used to investing tax relook at their
investment and make sure they are efficient.

2. How to choose a Tax Saving Investment

Money has many roles to play. It can enhance the quality of your life when managed
effectively. One of the cornerstones of effective money management is tax saving. Without
efficient tax saving investments, your hard-earned money gets eroded. On the other hand,
whenever your tax saving investments aren’t optimal, your returns suffer. Hence, it is essential
to understand the parameters to consider, while judging the worth of a taxsaving investment.

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  Good Returns
This is the most crucial parameter to judge any investment’s worth. Any investment plan should
be started with a view of its returns over the course of time, which should satisfy your needs and goals.
Competitive returns are generated by meticulous and well-researched investments. And since
returns are invariably tied with risks, a high return investment would also mean that it entails higher
risk. Hence one should decide their risk appetitebefore proceeding to invest in any instrument. ULIP
plans by ICICI Prudential have given consistently good fund performance across all fund types.
Along with the option to switch your money from one fund to another depending on your financial
priorities and investment outlook, these plans ensure that you get potentially better returns. What

makes ULIPs special is the life cover element which comes along with the potential for high returns.~
A life cover of up to 10 times the annual premium is recommended to ensure the safety of your
family in case of any mishap.

Check fund performance of our products here

It is also a good idea to get a pure protection plan to secure your family’s financial
future in your absence. Term plans are affordable and provide large cover at very low
premiums. With ICICI Prudential’s I Protect Smart, you can get a cover of `1 crore starting
at just `490 p.m. With the Smart Health cover, you can also secure yourself against 34 critical
illnesses.
Check premium for I Protect Smart >
Check premium for I Protect Smart along with Smart Health cover >

 Liquidity
Before investing, it is important to check how liquid your investment is. Liquidity means
the degree to which your investment can be quickly converted to cash, for your use.
Although any investment needs time to grow to be able to give good returns, a certain amount
of liquidity is sought after so that you can have access to your money when need arises. You
should note that ULIP plans let you withdraw money from your investment to meet your

needs, after the 5th year. While liquidity is sought after by many investors, a longer term of
investment provides better returns on your investment owing to the power of compounding.

2
  Option to switch Premium Frequency
A strategic investment should be able to give you the flexibility of switching the premium
frequency whenever you want. ICICI Pru Life Time Classic gives you that flexibility to change your
premium paying frequency from monthly to yearly at the time of policy anniversary. This can come
handy insituations when one starts their tax saving investment late in the year, andhas to invest a sizeable
amount of money in one go to save tax, but wouldneed to break their investment to monthly installments
to suit their budgetfrom the next year onwards, after the financial year ends.

 Tax Benefits on Maturity

The maturity corpus that you have built over the term of this investment should provide
you all the benefits at no tax. It’s important that you choose an investment option which does
not depreciate your money at maturity. Unit-Linked Plans are one such option. The sum of

money which you receive on maturity is tax free subject to conditions of Section 10(10D)* and
other provisions of Income Tax Act 1961. Claims received from Term Insurance Plans are

also tax* free subject to conditions under Section 10(10D).

 Continuity in Tax Savings

Tax saving is a recurring need, one which has to be carried out year on year. Continuity
in tax savings avoids the need to rethink your investmentsevery year and hence devote time to
other pursuits. An investment with 5 year lock in, like ULIPs serve the need of tax saving for all
those 5 years and eliminates renewed planning. And towards the end, the maturity amount

that you take home is also tax-free* subject to conditions of Section 10(10D) and other
provisions of Income Tax Act 1961, making it all the more rewarding. The only trade-off
here would be that your money would be locked in for 5 years. However, you should always
remember that it’s advisable to stay invested as long as possible to gain the potential for
higher returns.
The next step is to calculate your income tax outgo and make sure that you have the correct
estimate. Below given are the income tax slabs relevant to a first time tax payer.

3
 3. Tax Slabs (FY2019-20)
For every resident individual aged below 60 years and non-resident

S. No Income Slabs Applicable Tax Rates

(i) Income not exceeding `2,50,000 Nil

(ii) Income exceeding `2,50,000 but not morethan 5% of the amount by which
`5,00,000 the taxable income exceeds
`2,50,000

(iii) Income exceeding `5,00,000/- but not morethan `12,500 + 20% of the amount
`10,00,000 by which the taxable income
exceeds
`5,00,000/-.

(iv) Income exceeding `10,00,000 `1,12,500 + 30% of the amount

by which the taxable income
exceeds
`10,00,000

Surcharge
10% of the Income Tax, where taxable income is more than `50 lacs but up to
`1cr.15% of the Income Tax, where taxable income is more than `1cr.

Education Cess
4% Health & Education Cess is applicable on the income tax and applicable surcharge.

Calculate your income tax now!

4
 4. Tips on Tax Planning

5. Important Tax Sections for Salaried Individuals

Under this section, you can claim a maximum deduction of 1,50,000 from your total
80C income. This section helps in a major way to reduce down your total taxable income. The

5
 deduction is eligible to an individual or an HUF. If you have paid excess taxes, but have made
investment in PPF, NSCs, ULIPs, etc., youcan file your Income Tax Return and get a refund.
80CCD
This includes deduction from taxable income for individuals who make deposits to
pension scheme of Central Government. The maximum deduction permitted is either 10% of

salary* (for an employee) or 20% of gross total income (for self-employed) or 1,50,000-
whichever is less.

80CCE
The aggregate of deductions under section 80C, section 80CCCand 80CCD (1) shall not
exceed 1,50,000/-

This section has eligibility for individual and Hindu Undivided families (HUF) and is
80D
for the medical insurance premium paid. It can be paid for self, dependent children and
spouse. The deduction amount here is up to `25,000` from taxable income. An
additional deduction up to `25,000` of medical insurance premium paid for parents
(father or mother, or for both) is allowed.
50,000 if age of insured is 60 years or more

80DD
This section covers medical treatment expenditure, rehabilitation, and training of
disabled dependent. This is for resident individual and HUF, provided dependent doesn't
claim any deductions under section 80U from his taxable income. A fixed concession of
`75,000 can be claimed for disability within the range of 40% - 80%. In case of severe
disability, deductionof `1,25,000 can be claimed from taxable income.

80DDB
It includes the tax benefit for medical treatment of himself or dependent towards
treatment of diseases listed under rule 11DD. The deductions can be of amount actually
paid up to`40,000 and up to `100,000 in case of senior citizens.

6
 This section provides deduction from taxable income for interest payment on
80E loan taken for higher studies for relative*. The benefit* is equivalent to the entire
amount of interest paid for 8 years. So if you are planning to pursue higher studies,
make the best use of this section with the education loan.
80EE
This section is for individual taxpayers towards the interest repayment of a loan taken
by them to buy a residential property.The maximum deduction from taxable income allowed
is`50,000 subject to conditions of section 80EE of Income Tax Act1961.

80GG
This section is for taxpayers who don’t get HRA under salary. The deduction under this
section is available to the minimum of:

1. Rent paid minus 10% of total income

2. `5,000 per month
3. 25% of total income

Deduction from taxable income under this section is subject to

conditions of section 80GG and other provisions of the Income Tax
Act 1961.
80TTA This section allows deduction from taxable income of the interest earned from a
savings account held with a bank, or a co-operative society carrying on the business of
banking or a post office. The deduction limit is of `10,000 on interest income and eligible for
an individual and HUF.

7
 6. Disclaimers
*Tax benefits under the policy are subject to conditions under Section 80C, 80D,

10(10D) and other provisions of the Income Tax Act, 1961. Goods & Services tax and
applicable cesses will be charged extra as per prevailing rates. Tax laws are subject to
amendments made hereto from time to time. This document may be used as a proof for
claiming deductions while filing your tax returns. For any confirmation/impact analysis
customer is advised to refer the matter to his tax consultant.

Unit Linked products are different from traditional insurance products and are subject to the risk
factors.

The premium paid in ULIPs are subject to investment risks associated with capital
markets and the NAVs of the units may go up or down based on the performance of fund and
factors influencing the capital market and the insured is responsible for his/ her decisions.
ICICI Prudential Life Insurance is only the name of the Life Insurance Company and Unit
Linked Insurance is only the name of the unit linked insurance product and does not in any way
indicate the quality of the product, its future prospects and returns.

Please know the associated risks and the applicable charges, from your Insurance agent
or the Intermediary orpolicy document issued by the Insurance Company.

The various funds offered under this product are the names of the funds and do not in any
way indicate the qualityof these plans, their future prospects and returns.

Past performance is not indicative of future performance.

The premium of ₹490 per month has been calculated for a 25 year old healthy non-
smoker male for a life coverof ₹1 crore and for a policy term of 21 years under the ICICI Pru
I Protect Smart - Life option. This premium is inclusive of all taxes. The annual premium is
₹5,725 (inclusive of all taxes). Premium amount will differ according to the benefit option
chosen.

8
 Critical Illness Benefit/ Smart Health Cover (CI Benefit) is optional and available under
Life and Health and All in One options. This benefit is payable, on first occurrence of any of
the 34 illnesses covered. Only doctor’s certificate confirming diagnosis needs to be
submitted. The benefit is payable only on the fulfillment of the definition of the diagnosed
critical illness. The CI Benefit, is accelerated and not an additional benefit which means the
policy will continue with the Death Benefit reduced by the extent of the CI Benefit paid. The
future premiums payable under the policy will reduce proportionately. If CI Benefit paid is
equal to the Death Benefit, the policy will terminate on payment of the CI Benefit. To know
more in detail about CI Benefit, terms & conditions governing it,kindly refer to sales brochure.
Critical Illness benefit is available till age of 75.

ICICI Prudential Life Insurance Company Limited. IRDAI Reg No. 105. CIN:
L6601a0MH2000PLC127837, ICICI Prudential Life Insurance Company Limited. ADVT:
W/II/0773/2019-20.

Registered Address:- ICICI Pro-life Towers, 1089, Appasaheb Marathe Marg,

Prabhadevi, Mumbai-400025. For more details on the risk factors, terms and conditions, please
read the sales brochure carefully before con-cluding a sale. Call us on 1-860-266-7766 (10am-
7pm, Monday to Saturday, except national holidays and valid only for calls made from India).
For enquires related to new policies purchased online, please call us on 1-860-266-7766 and
select option 4 on our Interactive Voice System. Trade Logo displayed above belongs to
ICICI Bank Ltd & Prudential IP services Ltd and used by ICICI Prudential Life Insurance
Company Ltd under license.

Beware of spurious phone calls and fictitious/ fraudulent offers

• IRDAI or its officials do not involve in activities like sale of any kind of insurance or
financial products nor invest premiums.
• IRDAI does not announce any bonus. Public receiving such phone calls are requested
to lodge police complaint along with details of phone call, number.