With just two weeks left before the financial year ends on March 31, taxpayers still have a short window to finish several important financial tasks. Completing these steps in time can avoid penalties, ensure tax compliance, and maximise available deductions for FY26.
Below are some key actions individuals should consider before the financial year closes.
Pay pending advance tax, if applicable
March 15 was the deadline for paying the final instalment of advance tax. Individuals with income beyond salary, such as from freelancing, rent, capital gains, or interest, are required to pay advance tax if their total tax liability exceeds Rs 10,000 in a financial year.
Missing the deadline or underpaying can attract interest under Sections 234B and 234C of the Income Tax Act. Taxpayers who have not fully paid their dues may still need to review their tax liability and ensure there are no shortfalls.
Submit investment proofs to your employer
Most employers close their investment proof submission window towards the end of the financial year. Employees who declared tax-saving investments earlier must submit supporting documents to validate those claims.
Common proofs include:
- Life insurance premium receipts
- Equity-linked savings scheme (ELSS) statements
- Public Provident Fund (PPF) contribution records
- Health insurance premium receipts
- Home loan interest certificates
- Rent receipts for claiming HRA
If proofs are not submitted before the payroll cut-off, employers may deduct higher tax deducted at source (TDS) from the March salary.
Complete tax-saving investments
For taxpayers who opted for the old tax regime, the weeks before March 31 are the last opportunity to make eligible tax-saving investments.
Under Section 80C, individuals can claim deductions of up to Rs 1.5 lakh through instruments such as:
- Public Provident Fund (PPF)
- Equity-linked savings schemes (ELSS)
- Sukanya Samriddhi Yojana (SSY)
- Life insurance premiums
- Principal repayment on home loans
Those looking for additional deductions may also contribute to the National Pension System (NPS), which offers an extra deduction of up to Rs 50,000 under Section 80CCD(1B), over and above the Section 80C limit.
Ensure minimum contributions in small savings schemes
Certain government-backed schemes require a minimum annual contribution to keep the account active.
For example:
- PPF requires at least Rs 500 a year
- SSY requires a minimum deposit of Rs 250 annually
- Failure to deposit the minimum amount may lead to the account becoming inactive, which would require additional charges to revive.
Review capital gains and investments
As the year ends, investors should also review their investment transactions, including equities, mutual funds, or property sales.
This helps calculate both short-term and long-term capital gains and assess any tax liability. Investors may also consider tax-gain harvesting, where eligible long-term equity gains are booked within the tax-free threshold to optimise tax efficiency.
Check home loan statements
Home loan borrowers should download their annual loan statement from their lender to verify principal and interest payments.
Under Section 24(b), taxpayers can claim a deduction of up to Rs 2 lakh on interest paid on a self-occupied property. The principal repayment may also qualify for deduction under Section 80C.
With the financial year closing on March 31, reviewing these aspects now can help taxpayers avoid last-minute stress. A quick check of investments, deductions, and tax payments can ensure smoother tax filing when the return filing season begins later this year.
