Raj Khosla Founder and Managing Director, MyMoneyMantra.com replies: It isn’t advisable to put money into a second property simply to save lots of tax. Your funding choice ought to reasonably be based mostly on time horizon, holistic monetary targets, return on funding and danger urge for food. Given your scenario, your investments would require liquidity after 7-8 years, in your kids’s schooling. Prior to creating a choice, consider appreciation in property worth as towards returns from MFs, over a 7-8 years horizon. Additionally assess impression of long-term capital beneficial properties tax and medium time period money circulate necessities. On exhaustion of 80C restrict, you’ll solely be capable to declare deduction in compensation of curiosity as much as Rs 2 lakh u/s 24 of IT Act. Thus it is strongly recommended that dwelling buy choice ought to be reviewed, and you have to discover different tax saving choices corresponding to NPS, 80G, & 80D.

I’ve Rs 5 lakh in my SCSS account, which is maturing in June 2021. If I reinvest this quantity for an additional three years, can I declare Rs 1.5 lakh profit underneath part 80C?

Amit Maheshwari Associate, AKM World replies: Beneath the Senior Residents’ Financial savings Scheme (SCSS), one can open an account for 5 years by making a one time lump sum funding of as much as Rs 15 lakh. You may have the choice of extending the tenure for an additional three years. On the time of deposit within the SCSS account, an individual is eligible for deduction of as much as Rs 1,50,000 u/s 80C. Nonetheless, on the time of extension of the tenure interval, no deduction is allowed. Subsequently, you can not declare deduction within the occasion of extension of SCSS account.