Why Begin Tax Planning Now

Posted On Wednesday, Aug 20, 2014

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We are at the best time of the year to begin saving income tax. For those of us with the tendency to reserve tax planning activities to the last four months of the financial year, who prefer dealing with it as a one-time annual ritual, this suggestion may sound ill-timed. However there are some compelling reasons why the best time for you to get your tax saving plans in order is now.

To admit, all of us have the procrastination syndrome in varying degrees. This is helped by companies that push us tax saving products in December-March making the not-so-motivated among us seasonal tax savers.

NFOs of most RGESS mutual funds and new 80C tax saving funds are lined up for these four months of the year. Mutual funds are not alone either. Majority of the new product launches of life insurance companies and health insurance companies are targeted for this period. Banks run advertisements for their 5 year tax saving FDs during this time. So much so that December-March months have come to be called the ‘Tax Planning Season’!

However in reality the ‘Tax Planning Season’ may not be the best time to plan and save your taxes for a variety of reasons:

1. Products selected in the end time rush and panic may not be a good fit for you based on your risk profile; they could be quite an unprofitable choice in the long run.

2. You might find that you don’t have sufficient money required to invest and be forced to forfeit some of the deductions that could have been claimed.

3. There are always the chances of committing errors while filling up those numerous forms before deadlines, missing out important details which could backfire later on.


So it is best to plan in advance and stagger tax saving investments over the year.

Take stock of how much your income is expected to be through the year and chart out a plan to make use of maximum of the deductions and exemptions available to you. If you currently have continuing investments in tax saving products, for example an SIP, consider if the amount needs to be hiked. Especially since income tax deductions have been hiked by last month`s Union Budget, most investors would need to revisit their tax saving plans for the financial year.

As far as your 80C tax savings are concerned you need to look no further! Consider Quantum Tax Saving Fund # our ELSS which has one of the lowest expense ratios among the rest of the tax saving funds in the industry, currently at 1.25%. Remember lower the expense ratio the better it is for you. For current performance, portfolio and expense ratio of Quantum Tax Saving Fund kindly refer to the latest fact sheet.


If you are eligible for the RGESS tax benefit you can consider Quantum Index Fund# which qualifies for it. It is a passively managed index fund that attempts to replicate the returns of CNX Nifty index by having an identical portfolio as the index. Please find performance, portfolio and expense ratio of Quantum Index Fund in the latest fact sheet.

Call us on 1800-209-3863 to know more about these funds, or SMS <TAX> to 9243-22-3863 or simply write to us indicating your interest or query.

As with most other races, slow and steady wins the race of tax planning. Avoid making tax planning a seasonal activity. And don’t fail to involve a good financial planner for your assistance.


#Product Labeling
Name of the SchemeThis product is suitable for investors who are seeking*
Quantum Tax Saving Fund
(An Open-ended Equity Linked Savings Scheme)
• Long term capital appreciation
• Investments in equity and equity related securities of companies in S&P BSE 200 index and to save tax u/s 80C of the Income Tax Act. Investments in this product are subject to lock in period of 3 years..
• High Risk (BROWN)
Quantum Index Fund
(An Open- ended Exchange Traded Fund)
• Long term capital appreciation
• Investments in equity and equity related securities of companies in CNX Nifty Index.
• High Risk (BROWN)
* Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Note: Risk is represented as:
(BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk


Disclaimer, Statutory Details & Risk Factors:
The views expressed here in this article are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The article has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of this article should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. Please visit – www.quantumamc.com/disclaimer to read scheme specific risk factors.

Above article is authored by Quantum.

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