The tax year 2010-11 comes to closure on 31^st March 2011, with that the taxpayers start rushing for the documents/investment proofs, based on which tax liability is computed.

These are few of the important steps that one should take care of while preparing one’s tax computation. It would be a good idea to take the necessary action now to avoid the last minute rush of collecting the details and ensuring that all the available exemptions/deductions are claimed.

Here is the checklist of ten things which you should do before 31^st March particularly to avoid the last-minute rush and claim all the available exemptions/deductions:

1. Collect the proof of investments and expenses

Collect all the proof of investments and expenses that you have incurred to claim deduction under section 80C of the Income Tax Act, 1961 (The Act). These includes receipt for insurance premium paid, deposits made in your public provident fund account, investment made in equity-linked savings schemes, National Savings Certificates purchased, children’s tuition fees paid, etc.

2. Collect all your bank statements and TDS Certificates

Collect all your bank statements and Tax Deducted at Source (TDS) certificates, if any, from your bank. This will help you to compute the interest income on bank deposits and pay balance taxes, if any.

3. Collect your Form 16 / Form 12BA from your current employer or previous employer in case of change of employment if any

If you are a salaried employee then it’s essential for you to Collect Form 16 / Form 12BA from your employer in order to compute your tax liability. In case you have changed the employment during the financial year then you should collect the same from your previous employer.

4. Proof for house rent allowance

If you are claiming deduction for house rent allowance, then ensure that you have collected necessary details and proofs like rent receipt, lease deed, etc for claiming such benefit.

5. Collect home loan certificate

If at present you have a running home loan then rush to bank from whom such loan has been taken to collect the certificate of repayment of principal amount and interest paid during the financial year which helps you to minimize your tax liability.

6. Collect valid receipts for donation

If you have made donation to any charitable or religious institution then ensure that you have collected valid receipts for donation so that you can claim deduction under section 80G of the Act.

7. Collect all receipts with regard to health insurance premium

If you have paid health insurance premium for your family or self you can claim deduction under section 80D of the Act provided you have obtained all the receipts with regard to premium paid.

8. Keep necessary records for interest on educational loan

If you are claiming deduction for interest on educational loan, then ensure that you have the necessary records to substantiate the same.

9. Capital gain details if any

If you have sold/transferred any asset like house property, shares, mutual funds etc. then compute the capital gains and check the exemptions available to you. A distinction is to be made between long term and short term capital gains.

10. Compute your tax liability

After considering the above mentioned points you can now compute your tax liability and also see that whether you are required to pay any balance tax or not.

Timely and efficient tax planning go long way in lowering your total taxes by employing and taking advantages of in-built provisions of tax exemptions, deductions, concessions, rebates, relief’s, allowances and other benefits granted by the tax laws so that the incidence of tax is reduced.

We at Taxmantra.com have the expertise to guide you in lowering your tax outgo and thus enhancing your total take away.  We at Taxmantra.com provide full year support solving all your tax issues, in addition to filing of your return of income with excellent tax planning.

Please join us now in pursuit of simplifying individual taxation!

Alok Patnia

Founder and Director at Taxmantra.com