New Delhi, July 24 -- To combat market volatility and ensure predictable, safe returns, many investors choose investment options such as the National Savings Certificate (NSC) and the Kisan Vikas Patra (KVP) to build a diversified portfolio.

Both investment options are government-backed savings instruments that aim to provide investors with stable returns. However, their tax treatment differs slightly.

This is especially evident when reporting interest income in the Income Tax Return (ITR). Having a clear understanding of these fundamental differences can help taxpayers avoid reporting errors and omissions and claim the appropriate eligible tax benefits.

This becomes even more important as 31 July, the last date of tax submission for t...