March 31 Tax Deadline: With the financial year ending on March 31, taxpayers are left with just one day to complete last-minute tax planning. However, not all tasks follow the same deadline. For investors,
March 30 is effectively the last opportunity, as stock markets remain closed on March 31. So, any tax-saving strategy linked to equities must be executed today. However, other tax planning tasks can be completed by tomorrow, March 31.
Tax-loss harvesting can reduce capital gains tax
Under this strategy, investors can sell loss-making stocks or equity mutual funds to offset capital gains booked during the year. Missing today’s trading window means losing the chance to adjust gains for FY 2025-26.
Investors who have booked profits in equities this year can use losses to lower their tax liability.
By selling underperforming investments before market close, losses can be set off against gains, reducing taxable income. This is one of the few last-day strategies available to actively cut tax outgo.
However, the benefit is available only if transactions are completed before the market closes today, March 30.
Most tax-saving payments can still be done on March 31
While market-linked actions end today, several deduction-related payments remain open until March 31.
Taxpayers can still invest under Section 80C, including ELSS, PPF, and life insurance premiums. The additional Rs 50,000 deduction under the National Pension System (NPS) is also available till the end of the financial year.
Health insurance premiums under Section 80D and donations under Section 80G can also be paid on March 31 to claim deductions, provided payments are made through proper banking channels.
Advance tax and capital gains planning still open
Taxpayers who have not fully paid their advance tax can still deposit the remaining amount before March 31. While interest may apply, paying now helps reduce additional liability.
Those with capital gains from property or other assets should also act before the deadline. If the gains have not been reinvested, depositing them in the Capital Gains Account Scheme can help preserve tax benefits.
Final window for businesses to book expenses
For self-employed individuals and freelancers, March 31 is also the last date to record legitimate business expenses for the financial year.
Any eligible expense booked before the deadline can reduce taxable profits and overall tax liability.
Submit investment proofs to avoid excess TDS
Employees who have declared tax-saving investments must submit supporting documents to their employers before the payroll cut-off. If proofs are not submitted in time, employers may deduct higher TDS in the final salary cycles. While excess tax can be claimed as a refund later, it can impact immediate cash flow.
Deadline to file updated return (ITR-U)
March 31 is the last date to file an updated income tax return for Assessment Year 2021–22. This option allows taxpayers to correct missed income or reporting errors. Although additional tax and penalties apply, it helps avoid future scrutiny and larger liabilities.
Apply for lower or nil TDS certificate
Eligible taxpayers can apply for a lower or nil TDS certificate using Form 13 before the new financial year begins. This ensures reduced tax deduction on income such as interest or professional receipts from April onwards.
Ensure assets are put to use for depreciation claims
Businesses planning to claim depreciation must ensure that capital assets are put to use before March 31. Assets not operational within the financial year will not qualify for depreciation benefits.
GST Compliance: Key Checks Before Year-End
Reconcile GST returns with books
Businesses should match GSTR-1 and GSTR-3B filings with financial records and GSTR-2B. Any mismatch should be corrected in the March returns to avoid notices later.
Review input tax credit (ITC) claims
A careful review of input tax credit is essential. Ineligible or blocked credits under Section 17(5) should be identified and reversed to prevent penalties.
File LUT for next financial year
Exporters planning to supply goods or services without paying IGST must file a fresh Letter of Undertaking (LUT) before April 1 for FY 2026–27.
Prepare for e-invoicing from April 1
Businesses with turnover exceeding ₹5 crore in FY 2025–26 must be ready for mandatory e-invoicing from April 1, 2026. This may require system upgrades and process alignment.
