Tax Planning And Equivalent Returns: A Case Of Small Investor

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Rahul Rangotra


In India tax saving and investment of savings for the future is the bigger concern. Most investors invest in GPF, Fixed Deposits, Recurring Deposits, Real Estate, Gold, etc. without considering the consequences of these alternatives on tax liability. For saving tax, Indians buy insurance policies and invest in GPF, PPF, etc. As per sec 80C of the Income tax act saving up to Rs 150000 in some of the instruments like GPF, PPF, ELSS, Life insurance premiums, etc. are tax deductible i.e., taxable income is reduced by this amount to calculate the tax liability. This Case Study will help the students and practitioners of wealth management to learn the practical aspects of dealing with the tax planning of small investors, particularly the salaried employees in the lower middle-class category. The case will also help to learn the calculation of the equivalent returns and comparison of various investment alternatives.

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