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INVESTMENT MANAGEMENT PART III & TAX PLANNING
What is the meaning of 'tax planning' in the context of personal finance?
Tax planning is the legal arrangement of one's financial affairs in such a way as to reduce tax liability to the minimum permissible under the Income Tax Act, using available exemptions, deductions, and rebates.
What is the maximum deduction allowed under Section 80C of the Income Tax Act?
Maximum deduction under Section 80C is Rs 1.5 lakh.
Under which section of the Income Tax Act can an individual claim deduction for investments in PPF, ELSS, NSC, and life insurance premium?
Under Section 80C of the Income Tax Act, individuals can claim a deduction of up to Rs. 1,50,000 per year for investments in specified instruments such as PPF, ELSS, NSC, and life insurance premiums.
What is the tax treatment of interest earned on Public Provident Fund (PPF)?
PPF interest is completely exempt from income tax under EEE status.
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