What is Tax Planning Advisory

Paying taxes is our duty – definitely (and statistically) not one of the peoples’ favorites. Almost every salaried individual groans when tax is being deducted from his salary.

We cannot completely do away with taxes but we can surely reduce them to a great extent. Tax evasion is illegal. Tax Planning isn’t.

Each year, the budget consists of provisions and exemptions to reduce tax liability. This is where we come into the picture.

Based on each individual’s profile, we apply exemptions and provisions to reduce their tax liability.

Financial planning and tax planning are closely connected due to the fact that taxes are a huge expense as you go through life. If you become very wealthy, taxes will be your single greatest expense over the long run, thus planning to reduce taxes is a critical part of the overall financial planning process.

Income Tax planning is one of the most important aspects of personal finance. It forms an integral part of our savings plans. However, 90% of financial mistakes by individuals in India are made during the tax planning season.

Most of the individuals fail to assess their tax liability and postpone the tax savings to the last minute. Hence in India, tax planning is given more importance only during the last two quarters of the financial year. Due to these reasons, they end up paying unnecessary taxes or opt for unnecessary tax savings. Strategies for income tax planning in India often concentrate more on deduction under section 80C of the income tax code. Tax planning should be considered an integral part of an overall financial plan. This would help individuals in optimizing their tax planning strategies.

You may have often encountered problems in assessing your actual tax liability. As a result, you end up paying more than the required amount in form of taxes or buy unnecessary products. Also taking tax planning tips from friends and family who may not be experts affects your overall financial plan.

Good tax planning services advocate paying taxes smartly by utilizing the provisions in the Tax Laws to minimize the tax liability. The best tax saving plan will include a holistic view of the impact of your tax savings on your financial goals.

ELSS-Equity Linked Savings Schemes

An ELSS is an Equity Linked Savings Scheme, that allows an individual or HUF a deduction from total income of up to Rs. 1.5 lacs under Sec 80C of Income Tax Act 1961.

Thus if an investor was to invest Rs. 50,000 in an ELSS, then this amount would be deducted from the total taxable income, thus reducing her tax burden.

These schemes have a lock-in period of three years from date of units allotment. After the lock-in period is over, the units are free to be redeemed or switched. ELSS offer both growth and dividend options. Investors can also invest through Systematic Investment Plans (SIP), and investments up to ₹ 1.5 lakhs, made in a financial year are eligible for tax deduction

ULIP-Unit Linked Insurance Plan

Unit Linked Insurance Plans are investment-cum-insurance products that provide dual benefits of insurance and investment making it a financial solution linked to the market.

A portion of your premium is allocated towards providing life coverage, ensuring financial protection for you and your loved ones and the remaining is then invested in a fund that aligns with your preferences and goals.

You have the flexibility to choose from a range of options, including equity, debt, or a combination of both funds, based on your risk appetite and investment objectives.

How To Choose Best ULIP Plans in India?
Before paying the policy premium, investors should keep a few parameters in mind while choosing the plan. Here’s a list of points to consider while buying one

Determine Personal Investment Goals
Before choosing a ULIP plan, it is important for every investor to analyze their long-term financial goals. It is mandatory to choose a ULIP plan that is in sync with your investment horizon and goals.

Decide Investment Goals
Buying a ULIP becomes easier when investment goals are clearly defined. It may vary from the education requirements of children to post-retirement needs. Keeping clear goals in mind further helps choose the Investment amount and tenure to get maximum benefits.

Compare ULIPs
It is important to compare the different features and advantages offered by each ULIP plan to determine the one that suits an individual's specific needs. Comparing different plans helps you get the maximum maturity or death benefits.

Evaluate Risk Profile and Financial Stability
Before selecting a ULIP plan, it is crucial to evaluate your personal risk tolerance and financial situation. Young individuals who have a higher willingness to take risks may consider equity funds for highest returns. For risk-averse investors, debt funds are a better choice.

Term Insurance

Term Life Insurance is like buying a safety net for your family. You pay a small amount of money (premium) every month or year for a certain number of years (policy term) to keep this safety net active. If something happens to you, the insurance company pays your family a significant sum of money (Sum Assured). This money can help them pay bills and manage household expenses. But if nothing happens to you during the policy term, you get nothing back. It's a way to ensure your family is safe if the unexpected happens.

Why Should You Buy Term Insurance?
Here is a list of 3 reasons why buying term life insurance is important:

To Protect your family’s future:
Being a sole earning member of your family, you are responsible for the well-being of your parents, spouse, and children. Buying a pure term life insurance plan is important to make sure that your family is able to meet their financial obligations even when you are not around.

To Protect your assets:
You might have built different assets, such as an office, vehicle, or home, through loans. This plan ensures that the weight of these borrowings will not cause any financial difficulty to your family after you.

Stay Prepared for uncertainties:
Just like life insurance plans, in case of your unforeseen death, the benefits from a term insurance plan can help your family pay for their regular expenses and also accomplish their long-time objective.

National Pension Scheme

NPS was introduced by the Central Government to help the individuals have income in the form of pension to take care of their retirement needs.

The Pension Fund Regulatory and Development Authority (PFRDA) regulates and administers NPS under the PFRDA Act, 2013.

NPS is a market-linked defined contribution scheme that helps you save for your retirement. The scheme is simple, voluntary, portable and flexible. It is one of the most efficient ways of boosting your retirement income and saving tax. It allows you to plan for a financially secure retirement with systematic savings in a planned way.

NPS is available to all the citizens of India and offers different models depending on the following user segments:

1. As per the notification of the Ministry of Finance dated 5/7/2003-ECB-PR dated 22nd December 2003, NPS is mandatory for Central Government employees, who joined service on or after January 1, 2004, except for those in the armed forces and is also extended to the employees of Central Autonomous Bodies from the said date. It is also available to all State Government employees/employees of State Autonomous Bodies, if the respective State/UT opted for it.

2. NPS can be voluntarily adopted by the corporates for their employees and contributions are made to the NPS account as per the terms of employment.

3. NPS voluntary model is available to all the citizens of India including those residing abroad, between the age of 18 and 70 years.

Health Insurance

Health Insurance is a type of insurance that covers the medical expenses of the insured due to an illness or accident in exchange for a premium amount. It enables the insurance company to provide medical coverage for hospitalization expenses, day care procedures, critical illnesses, etc. A health plan also offers multiple benefits, including cashless hospitalization and free medical check-ups.

Buying a health insurance policy online comes with several benefits. Take a look at them below:

Easier to Compare Plans –

It is easier to compare health insurance plans from different insurers online at websites like Policybazaar.com to make an informed decision.

More Convenient –

It is more convenient to buy the policy online as you do not have to visit the branch of the insurance company or take an appointment to meet an insurance agent.

Online Discounts –

It allows you to avail discount on premiums for buying the policy online.

Lower Premiums –

Health plans are available for a lower premium online as insurance companies save a lot on operational costs.


Optifin Advisors Financial Services provides comprehensive financial solutions to individuals and businesses, tailored to their specific needs.

Useful Links

Get In Touch

Office No. 305,3rd floor, Swastik Disa Corporate Park, Near Shreyas Signal, L.B.S Marg, Ghatkopar (W), Mumbai-400 086