Income Tax Return Filing Deadline: 3 tax saving tips for last minute taxpayers

Income Tax Return Filing Deadline: As the deadline for filing income tax return (ITR) for this assessment year draws near, several taxpayers who are yet to file their ITR can be seen tweeting to the Finance Ministry to enquire whether the July 31 deadline will be extended or not. As per sources, unless there's a glitch in the e-filing portal due to last-minute rush, there are no hints that the last date for filing income tax return will be extended this year. However, in case you are yet to file your ITR, then here are 3 ways suggested by tax expert that you can utilize to cut your tax liability —  

Beyond the conventional tax saving measures that salaried taxpayers use to the hilt, like the regular 80C and 80D, three other powerful tax-saving clauses that could yield sufficient tax savings are — 

1) Income Tax Return Filing Deadline: Long Term Capital Gain (LTCG)

First on the list is Long Term Capital Gain (LTCG), which can be utlised to get exemption of upto Rs 1 lakh every year. 

Explaining this clause, Mohit Gang, CEO of MoneyFront (subsidiary of Niyogin Fintech Ltd), says, "If one has long term unrealised gains in the book arising out of stocks or mutual funds, then they can redeem some portion of capital and book a gain of Rs 1 lakh every year to make it tax-free."

The redemption proceeds can be re-invested again to avoid market risk, he adds. 

2) Income Tax Return Filing Deadline: Set-off clauses on capital gain

Second lesser-used mode of saving taxes is utilising the set-off clauses on capital gains.

"If one has both short term gains and losses in the book or even long term losses and gains in the book, then they could consider setting off the gains against losses to avoid taxes on the gains," Gang states.

In such cases, loss can also be carried forward for 8 years and set-off against future gains.

However, for those looking to utilize the set-off clauses on capital gains, he warns that this will warrant many other considerations and has to be done carefully. 

3) Income Tax Return Filing Deadline: Hindu Undivided Family (HUF)

One very important mode of tax saving available in the income tax laws is formation of HUF (Hindu undivided family). 

The HUF is a well-known, but a lesser-used clause that could be used to reduce tax burden.

Explaining this, Kang says that one can save taxes by creating a family unit and pooling in assets to form an HUF. 

"HUF is taxed as a separate entity and hence is eligible for all 80C, 80D, 80G and even capital gain exemptions," he says.

Regarding the eligibilty, he informs that Hindus, Sikhs, Jains and Buddhists can form an HUF in order to ave income tax. 

However, it is always advisable to seek professional help from a tax consultant or chartered accountant in case a taxpayer is looking for ways to save tax and utilises the above-mentioned income tax clauses to reduce their income tax liability.