Tax planning helps you legally reduce your tax liability while achieving your financial goals. For FY 2025-26, here are five practical ways to save tax.

1. Choose the Right Tax Regime

Before making investments, compare the old and new tax regimes. The new regime offers lower tax rates, while the old regime allows various deductions and exemptions. Choosing the right regime can significantly reduce your tax liability.

2. Utilize Section 80C Deductions

Under the old tax regime, you can claim deductions up to ₹1.5 lakh under Section 80C through:

• Public Provident Fund (PPF)
• Employee Provident Fund (EPF)
• ELSS Mutual Funds
• Life Insurance Premiums
• Tax Saving Fixed Deposits

3. Invest in NPS

Contributions to the National Pension System (NPS) can provide an additional tax deduction of up to ₹50,000 under Section 80CCD(1B), over and above the Section 80C limit.

4. Buy Health Insurance

Health insurance not only protects your family but can also help save tax under Section 80D. Premiums paid for yourself, spouse, children, and parents may qualify for deductions under the old tax regime.

5. Plan Early

Many taxpayers wait until the end of the financial year to invest. Starting early allows better financial planning, avoids last-minute decisions, and helps maximize tax-saving opportunities.

Final Thoughts

Tax saving should be a part of your overall financial planning strategy. By choosing the right tax regime and making informed investments, you can reduce your tax burden while building long-term wealth.