Key financial tasks to do before March 31 deadline
What's the story
As the fiscal year 2025-26 comes to a close, taxpayers must finish some key financial tasks by March 31, 2026. These tasks can help maximize tax savings and avoid penalties. They include making tax-saving investments, submitting investment proofs to employers, paying advance tax, and filing an updated income tax return if necessary. Here's a detailed look at these essential financial activities.
Investment options
Invest in tax-saving instruments
Taxpayers opting for the old tax regime can invest in a Public Provident Fund (PPF), Sukanya Samriddhi Account (SSA), and National Pension System (NPS) to avail tax benefits under Section 80C of the Income Tax Act, 1961. These schemes also provide tax benefits. Hence, NPS, PPF, and SSY subscribers must deposit a minimum amount in their respective accounts to keep them active.
Proof submission
Submit investment proofs to your employer
Employees who have declared tax-saving investments earlier in the fiscal year must submit supporting investment proofs to their employer before the payroll cut-off date. If these proofs are not submitted, the employer may deduct higher tax at source (TDS) from the salary for remaining months of the fiscal year. This is an important step to ensure correct tax deductions and avoid any last-minute surprises.
Tax payment
Pay advance tax, if applicable
The due date for advance tax for assessment year 2026-27 is March 15, 2026. Not paying it could attract interest and penalties under Income Tax rules. Advance tax should be paid if the total tax liability exceeds ₹10,000 in a fiscal year. Not doing so can invite interest under tax provisions, making timely payment crucial to avoid additional costs.
Insurance benefits
Buy health insurance for additional deductions
Under Section 80D of the Income Tax Act, taxpayers can claim a deduction for premium paid toward health insurance policies. If you invest in health insurance, you can get a deduction up to ₹25,000 under Section 80D for yourself and your family (₹50,000 if age of insured is 60 years or above) and up to ₹75,000 (₹50,000 if age of insured is 60 years or above) for your parents.
Home loan benefits
Claim deductions on home loan interest payments
Section 24(b) of the Income Tax Act allows taxpayers to claim tax benefits on interest paid toward self-occupied properties. You can claim a deduction of up to ₹2 lakh against the interest paid on your home loan, making homeownership affordable for taxpayers. This provision is especially beneficial for those who have taken loans to buy their own homes.