Halal Tax Saving in India: Minimize your tax with no Investments

In the previous posts I discussed the status of Tax Saving Investments.
There are ways to at least minimize some impact of taxes. Here are some of them.
Will write about individual ones in detail is sometime, insha-allah. Update: Added articles of couple of topics.

Initial seven options are ones that every single salaried person can make use of; remaining are case-specific:

1. HRA (House Rent Agreement)
2. Internet and Telephone Rental
• Landline phone
• Mobile phone
• Broadband/ ADSL Internet
3. Medical Allowance
4. Insurance (maybe or may not be valid)
• Pure Life Insurance (Term Insurance)
• Self/Spouse/Children Mediclaim
• Parental Mediclaim
5. Donations to registered NGO/ Madrasas'/ Relief Funds/ Charitable Trusts.
6. Conveyance Expenses
7. LTA (Leave Travel Allowance)
8. Meal Coupons (and maybe some Gift Coupons)
9. School Fees of children.
10. Donation to political parties (I hope no one uses this one:))
11. Medical treatment for self in case of catastrophic illness/ disability.
12. Medical treatment for dependent handicapped/ disabled.

Pray for the taxes that you pay

I really mean it. Even if you adopt all of the measures am suggesting below you would certainly pay a good amount of taxes. Not to mention the huge amount of indirect taxes that everyone has to pay and there is no escape. (Indirect taxes are taxes on goods and services. So whenever you buy something it has a big chunk of tax built into it. Like say a cellphone costing 10K could have 2-4K of tax in it. So this unknown tax is actually also huge in number.)

OK back to the main point. Suppose you end up paying 50K tax in a year (not taking into account your indirect taxes). Now this is a good amount. Even your Zakat will be much less than this (unless you have inherited some good amount of wealth). 

We all know how efficient and ethical our governments are. If they allot 100 crores to a project, on an average maybe 20 crores might be used for the exact purpose; rest being pocketed for the luxuries and black money of the politicians. 

Now your hard-earned money should not go to feed such people's riches. So you should pray to Allah that the taxes paid by you end up in the good things like building school, hospitals, empowering the poor and disabled, salaries of workers, relief-work, scholarships etc.
Well, that it the only thing that we can do for the taxes we pay. 

Disclaimer

1. Do not claim to to be an expert either in religion or finance.
2. Most of information is based on personal research.
3. I would not agree to anything in which I have a little doubt or the heart does not agree. All finance decisions taken after some amount of research.
4. If you disagree to a point or there is some mistake, please express your views. Remaining silent would do me a lot of harm if I am wrong.

Scope

In the name of Allah the most beneficent, the most merciful.


Assalam alaykum,


I started this blog because I couldn't find easily halal finance options. I mean there are tons of sites related, but most are written with context to some Muslim country. Out here in India, though we have a large Muslim population; finance and banking based on Shari'a is non-existent. Hence it becomes difficult to apply the principles or views based on some other country.
E.g. Investing in a stock of a sugar company is surely a halal options in Saudi Arabia; but the same is not true in India because sugar industries also provide substantial raw materials to alcohol manufacturing companies.


So over the years, whatever I have learned am posting the same.


Following is the scope of this blog:

1. This blog is limited to personal finance only; not as a profession or employment.
2. Even in finance it will discuss only in relation to islamic investments.
3. Religious topics will be discussed with respect to finance only; no other religious topics.
4. All things discussed are with respect to India only.