Diwali is a time of celebration and togetherness. The festival of lights marks the victory of good over evil. Deepavali is considered an auspicious occasion for new beginnings. Families come together to decorate their homes with diyas and rangoli, exchange gifts and enjoy festive meals.
During the Diwali season, many employees receive an annual bonus and other financial incentives from their employers as a token of appreciation.
While it could be tempting to spend the bonus on shopping or festivities, it’s also a great opportunity to invest a portion of this bonus. Instead of spending the money on shopping and other festive purchases, investing a portion of the bonus amount could help in building wealth while enjoying tax benefits. In the second half of the current financial year, investing the Diwali bonus in tax-saving instruments could be a prudent decision as it can bring down overall tax liability.
Under Section 80C of the Income Tax Act, 1961, taxpayers can claim deductions up to Rs 1.5 lakh in a financial year on eligible investments. This not only helps in saving taxes but also in building long-term wealth. However, these tax benefits can only be claimed under the old tax regime.
