Prajna Capital

---

• Income Tax Calculation on House Property
• How to get tax benefit out of your HRA?
• Loan Product Review: ICICI Bank Fixed-Rate Loans
• Change of name: Axis Tax Saver Fund
• Tata Young Citizen’ Fund
• Equity Funds Schemes from ICICI Prudential AMC
• Keep a check on Cost of investments in equities
• Good credit score can get you loans faster, cheaper
• Sale Proceeds of Immovable Property
• Mutual Fund Review: ICICI Prudential Banking and Financial Services Fund

Income Tax Calculation on House Property Posted: 07 Sep 2011 05:08 AM PDT While calculating the tax liability for an assessee, five heads on income are taken into consideration. These are: income from salary, house property, business or profession, capital gains and Other sources. Among these, computation of house property income is the most complicated, as this is the only income which is taxed on a notional basis. That is, the tax is based not on the actual income earned but on the inherent capacity or potential of the property to generate income, also known as Annual Value (AV).   HOW IS AV DETERMINED?     A single self-occupied property is not charged any tax. But the tax liability comes into play when the taxpayer has more than one property. Then, the AV of any one house, depending on his/her choice, can be taken as zero. The tax department will consider that the other properties have been rented out and taxed on a notional AV. However, the taxpayer is given the option to choose the property he wants to bring under the tax net every year.   Arriving at the AV, in case of rented properties (or more than one self-occupied property, as the case may be). Here, the AV figure is taken as higher of the actual rent received or the sum for which the property might be expected to be earn from year to year.   To determine what exactly constitutes the sum for which the property might be reasonably expected to be rented from year to year, the higher of the Municipal Valuation (MV) of the property or its Fair Rental Value (FRV) has to be chosen, taking into account its size and area in which it is located.   However, where such property is governed by a Rent Control Act, the standard rent fixed thereof will have to be taken for determining the AV.   In sum, the AV of a rented property will be the higher of the MV or the FRV, but restricted to the standard rent. However, if the actual rent received or receivable exceeds this, then such actual rent will be taken as the AV. The following table will make this point clearer.   BUT THERE ARE DEDUCTIONS...   From the AV of the property, any municipal taxes levied by the local authority can be deducted, even if they are paid for past (arrears) or future (advance) years. But such deductions are allowed only if the municipal taxes are borne and have been actually paid during the year by the owner. Taxes due but not paid are not allowed as a deduction.   For each year, the municipal taxes actually paid will be allowed as a deduction from the AV. The value arrived at by deducting the municipal tax is referred to as Net Annual Value (NAV). From such NAV, deductions under Section 24 as detailed below are allowed and the balance finally is the taxable income under the head 'Income from house property'.   Section 24 basically offers two deductions.   1) The first one is a statutory deduction of 30 per cent of the NAV. This is similar to the standard deduction that was available on salary income. 2) The second deduction is to do with interest payable on properties bought on mortgage. For rented properties (or where the deemed AV is taxed in the case of more than one self-occupied property), the full amount of interest paid without any limit is allowed as a deduction.   In the case of a self-occupied house, where the AV is nil, the interest deduction is limited to `1.5 lakh on loans borrowed after April 1, 1999, and `30,000 on loans borrowed prior to that date. Where the property is co-owned, each co-owner is entitled to interest deduction of up to 1.5 lakh. In addition, the Section 80C deduction is available up to `1lakh on the principal portion of the equated monthly instalment.   This deduction is also available to each co-owner. Therefore, in the case of a husband and wife, if the property is bought jointly, then an aggregate deduction of `5lakh would be available to them on their combined income. Also, where a borrower raises a fresh loan to repay the original loan, the interest paid on the second loan would also be allowed as a deduction, as detailed above.   FOR UNDER-CONSTRUCTION PROPERTY   Both the concessions and deduction for repayment of capital and deduction of interest are allowed only when the income from house property becomes chargeable to tax. In other words, the construction should be complete, the flat ready for occupation and the municipal AV should be known. The interest paid for the years prior to the year in which the property was completed is deductible in five successive yearly instalments, starting from the year in which the acquisition/construction was completed and each of the four immediately succeeding years.   The limit of `1.5 lakh includes the current year's interest, as well as the instalment of pre- acquisition/construction period. For example, say the pre-construction period interest amounts to `5lakh and the current year's interest amounts to 80,000. Now, `5lakh is to be spread over five years, beginning from the year in which the construction is completed.   So, for that year, in the case of a rented property, the taxpayer can avail of a deduction of `1.8 lakh (`1lakh + `80,000), whereas in the case of a self-occupied property, the deduction would be limited to `1.5 lakh.   -----------------------------------------------------------------   Also, know how to buy mutual funds online:   Invest in DSP BlackRock Mutual Funds Online   Invest in Reliance Mutual Funds Online   Invest in HDFC Mutual Funds Online   Invest in Sundaram Mutual Funds Online   Invest in Birla Sunlife Mutual Funds Online   Invest in UTI Mutual Funds Online    Invest in SBI Mutual Funds Online   Invest in Edelweiss Mutual Funds Online   Invest in IDFC Mutual Funds Online

How to get tax benefit out of your HRA? Posted: 07 Sep 2011 03:18 AM PDT The tax season and all the frantic hurry associated with it is due to start in a month or so.    There are many tax components you need to be clear about and also figure out how to plan your investments to gain maximum returns as well as maximum tax benefits. One such tax component is the tax benefit you can claim from your house rent allowance. HRA (house rent allowance) is provided to salaried people under Section 10 (13A) of Income Tax Act, 1961, in accordance with rule 2A of Income Tax Rules. The four components of HRA calculation When you are calculating HRA for tax exemption you take into consideration four aspects which includes salary, HRA received, the actual rent paid and where you reside, i.e. if it is a metro or non-metro. If these aspects remain constant through the year, then tax exemption is calculated as a whole annually, if this is subject to change, as in a rent hike or shift in residence etc. then it is calculated on a monthly basis. The place of residence is significant in HRA calculation as for a metro the tax exemption for HRA is 50% of the basic salary while for non-metros it is 40% of the basic salary. How HRA exemption is calculated? To figure out how much HRA exemption you are eligible for, consider these three values which includes a.The actual rent allowance the employer provides you as part of your salary, b. the actual rent you pay for your house from which 10% of your basic pay is deducted, c. 50% of your basic salary when you reside in a metro or 40% if you reside in a non-metro. The least value of these three values is allowed as tax exemption on your HRA. You can discuss restructuring your pay structure with your employer in order to avail the most of your HRA tax benefit. Here is a sample illustration for your understanding: Sunitha earns a basic salary of Rs 40,000 per month and rents an apartment in Delhi for Rs 20,000 per month (hence eligible for a 50% of the basic pay for HRA exemption). The actual HRA she receives is Rs 25,000. These values are considered to find out her HRA tax exemption: a. Actual HRA received, i.e. Rs 25,000, b. 50% of the basic salary, i.e. Rs 20,000, and c. Excess of rent paid over 10% of salary, i.e. Rs 20,000 - Rs 4,000 = Rs 16,000 The value considered for her actual HRA exemption will be the least value of the above figures. Hence, the net taxable HRA for Sunitha will be Rs. 25,000 - 16,000 (available HRA deduction) = Rs. 9,000. HRA exemption for the self employed Self employed professionals are eligible for tax deductions under section 80GG of Income Tax Act, 1961. This provision in the IT Act enables a person who is paying rent but does not receive HRA allowance to claim tax exemption for his rent expenses. Who can you pay rent to? It is not essential that you should pay rent only to a landlord to avail your HRA benefits. You can pay rent to your parents as well to claim tax benefits. However, they need to account for the same in their tax sheet and will be entitled to pay tax for the same. Remember you cannot claim HRA exemption on the basis of paying rent to your spouse. Tax laws do not permit this in view of the relationship. When you take up residence together, you are expected to do so and hence such a transaction does not bear merit under tax laws. Sham transactions can only spell trouble under scrutiny, so steer clear of these. Tax proof for HRA exemption You need to submit proof of rent paid through rent receipts, for which only two need to be submitted, one for the beginning of the year and one towards the end of the financial year. It should have a one rupee revenue stamp affixed with the signature of the person who has received the rent, along with other details such as the rented residence address, rent paid, name of the person who rents it etc.

Loan Product Review: ICICI Bank Fixed-Rate Loans Posted: 07 Sep 2011 12:33 AM PDT Private sector lender ICICI Bank launched a 'fixed interest rate' product last week, although the rates are "fixed" only for an initial period of one and two years. Under the one-year fixed rate home loan, you can obtain a loan of up to . 25 lakh at a rate of 10.50%. This rate will be 11% for a loan amount between . 25 lakh and . 75 lakh, while loans of over . 75 lakh will attract an interest of 11.5%. From the second-year onwards, you will migrate to a floating rate linked to the ICICI Bank Base Rate (IBase) plus the margin decided at the time of sanctioning the loan. Under the two-year fixedrate scheme, loans of up to . 25 lakh will carry an interest rate of 10.75%. The rate will be 11.25% for amounts up to . 75 lakh and 11.75% for loans more than . 75 lakh. Again, from the third year, the rate will be pegged at the IBase plus margin. According to the bank, the fixed rates will "shield customers from frequent changes in home loan interest rates and protect them from any rise in interest rates over the next one year or two years". If you are one of those who feel the overall economic and liquidity scenario can only worsen from here, and consequently the rates will continue their northward march, then you can consider other aspects of the scheme. But, many bankers believe the RBI is probably done with rate hikes, save one or two more in September. If the view is proven correct, the upward movement of rates will halt at the current level before starting to slide down gradually. Given this possibility, you shouldn't go gaga over the offer of a fixed rate, especially for the two years. Conversely, if the rates indeed continue to go up for a longer period than anticipated, this product could turn out to be a teaser rate scheme or loans that come with an interest rate lower than the prevailing lending rates of the bank, which is not viewed favourably by the Reserve Bank of India. If you are unable to service the upwardly revised EMIs once market linked rates become effective after one or two years, you could land yourself in soup. UPSIDE: If you are convinced the interest rates would continue to rise and want to lock the rates for the initial period, you may find the scheme attractive. DOWNSIDE: If the rates start falling shortly after your loan is approved, you could miss out on the opportunity of benefiting from the softening rate scenario.

Change of name: Axis Tax Saver Fund Posted: 06 Sep 2011 11:35 PM PDT   Axis Mutual Fund has changed name of its Axis Tax Saver Fund to Axis Long Term Equity Fund. The new scheme will be an open ended equity linked saving scheme with 3-year lock in. The effective date for this change is September 2, 2011.   -----------------------------------------------------------------   Also, know how to buy mutual funds online:   Invest in DSP BlackRock Mutual Funds Online   Invest in Reliance Mutual Funds Online   Invest in HDFC Mutual Funds Online   Invest in Sundaram Mutual Funds Online   Invest in Birla Sunlife Mutual Funds Online   Invest in UTI Mutual Funds Online    Invest in SBI Mutual Funds Online   Invest in Edelweiss Mutual Funds Online   Invest in IDFC Mutual Funds Online

Tata Young Citizen’ Fund Posted: 06 Sep 2011 09:34 PM PDT Objective To provide long-term capital growth along with steady capital appreciation to its unit holders, while at all times emphasising the importance of capital preservation. Option Available Growth Option a). Anytime Exit Option: Under this option parent/guardian will be allowed to redeem/switch the investments before the child attains 18 years of age. b). Lock-in Option: Under this option investment will be locked in till the child attains 18 years of age. No repurchase/switch will be allowed before the child attains 18 years of age. Entry Load 2.50% Exit Load If Child attains majority after 7 years from the date of allotment:- Less than 3 years - 3% Between 3 & 7 years - 2% More than 7 years - 1% No load after the child attains majority If Child attains majority before 7 years from the date of allotment:- Less than 3 years - 3% Between 3 & 7 years - 2% More than 7 years - NIL Minimum Application Amount Rs.500/- & in multiples of Rs.500/- thereafter. -----------------------------------------------------------------   Also, know how to buy mutual funds online:   Invest in DSP BlackRock Mutual Funds Online   Invest in Reliance Mutual Funds Online   Invest in HDFC Mutual Funds Online   Invest in Sundaram Mutual Funds Online   Invest in Birla Sunlife Mutual Funds Online   Invest in UTI Mutual Funds Online    Invest in SBI Mutual Funds Online   Invest in Edelweiss Mutual Funds Online   Invest in IDFC Mutual Funds Online

Equity Funds Schemes from ICICI Prudential AMC Posted: 06 Sep 2011 07:46 PM PDT ICICI Prudential Discovery Fund ICICI Prudential Discovery Fund offers an alternative value investing style that helps you truly balance your equity portfolio. It aims to discover stocks at a discount to their fair value. This provides a margin of safety over the long term. It diversifies your existing equity portfolio. An investor, who diversifies across growth and value portfolios, can reduce volatility. ICICI Prudential Power ICICI Prudential Power, is an open-ended equity fund which is focused on capturing market opportunities & seeking out the optimum sectors to invest. It follows a blend of top-down macro research to identify growth sectors and bottom-up fundamental research to identify stocks. ICICI Prudential Dynamic Plan ICICI Prudential Dynamic Plan has the agility to capture upside opportunities across value and growth , large and midcap , index and non-index stocks. On the flip side it also has ability to move into cash as markets get overvalued. ICICI Prudential Emerging S.T.A.R Fund ICICI Prudential Emerging S.T.A.R. Fund is an open ended equity fund that is focused on the mid-cap sector. It follows a fundamentally driven bottom-up approach to investing, identifying stocks that have the potential to grow many fold. The investment philosophy is growth-oriented, and diversified within the specific theme of mid-cap stocks. ICICI Prudential Tax Plan ICICI Prudential Tax Plan is an open-ended equity linked saving scheme (ELSS). It has a lock-in period of 3 years, which ensures that you compulsorily remain invested over this period. This 3 year lock-in gives the fund manager the flexibility to make strategic long term investments in a diversified portfolio comprising a mix of large and medium sized stocks, chosen after careful fundamental research.   ICICI Prudential Growth Plan ICICI Prudential Growth Plan seeks to invest in large, profitable and well known companies, and aims to benefit from the best long term investments that the market has to offer in the large-cap space. Thematic and Sectoral Funds ICICI Prudential Infrastructure Fund ICICI Prudential Infrastructure Fund is an open-ended equity fund focused on capturing the opportunity presented by the long term growth potential of the Indian Infrastructure sector. It invests across infrastructure sectors such as Cement, Power, Telecom, Oil and Gas, Construction, Banking etc. ICICI Prudential Services Industries Fund ICICI Prudential Services Industries Fund seeks to optimise the risk adjusted return by a mix of top-down macro and bottom-up micro research to identify stocks in the services sector. It is a multi-sector fund and therefore has a much lesser concentration risk than a typical sector fund. ICICI Prudential FMCG Fund ICICI Prudential FMCG Fund is an open-ended equity fund, that predominantly invests in companies with a retail and consumption focus. The portfolio is made up of fewer number of scrips, chosen to reflect the prospects of the FMCG sector. Within the broad definition of the sector, scrips are held across sub sectors like food, retail distribution, apparel, and consumables. ICICI Prudential Technology Fund ICICI Prudential Technology Fund is an open-ended equity fund that predominantly invests in knowledge sectors like IT and IT Enabled Services, Media, Telecom etc. However, in the interest of retaining diversification across companies in the sector, the fund retains a 10% cap on a single company, as is the case for diversified equity funds. Hybrid Funds ICICI Prudential Child Care Plan ICICI Prudential Child Care Plan is an investment instrument specially designed to help you give your child a head start in life. It offers two options - Gift (Suitable if your child is in age group of 1-13 years.) and Study (Suitable if your child is in age group of 13-17 years.), for the differing needs of parents with children in differing age groups. ICICI Prudential Balanced Fund ICICI Prudential Balanced Fund takes care of this asset allocation by investing in equity for capital appreciation and debt for stable returns. It focuses on reducing volatility of returns by increasing / decreasing equity exposure based on the market outlook and using a core debt portfolio to do the rebalancing. ICICI Prudential Income Multiplier Fund ICICI Prudential Income Multiplier Fund predominantly invests in a debt portfolio that is conservatively managed with a focus on generating regular income. The objective is to keep interest rate risks and credit risks low. The debt component is about 70% of the portfolio, and can be upped to 100% should there be a need. ICICI Prudential Monthly Income Plan ICICI Prudential Monthly Income Plan is a conservatively managed fund that invests predominantly in debt securities. It invests with the view of generating regular income from debt securities.   -----------------------------------------------------------------   Also, know how to buy mutual funds online:   Invest in DSP BlackRock Mutual Funds Online   Invest in Reliance Mutual Funds Online   Invest in HDFC Mutual Funds Online   Invest in Sundaram Mutual Funds Online   Invest in Birla Sunlife Mutual Funds Online   Invest in UTI Mutual Funds Online    Invest in SBI Mutual Funds Online   Invest in Edelweiss Mutual Funds Online   Invest in IDFC Mutual Funds Online

Keep a check on Cost of investments in equities Posted: 06 Sep 2011 10:03 AM PDT   INVESTORS may or may not get I their desired returns from their in vestments in the financial market, whether in equity, debt or gold assets. But, to just carry out their investments through the financial market, they incur a cost. Investment in equities, for instance, carries the highest risk among investment asset classes. In the long term, it gives a financial return that is more than fixed-income bearing investment instruments. Say, presently, the long-term (five years and above) annualised yield of a fixed-income instrument is 9-11 per cent. Equity investors would expect to get annualised returns of 15-20 per cent to compensate for the higher risk, which could be severe fall in the value of their investments on the back of an equity market crash. Given such return expectations, how much transaction costs should an investor afford so that it doesn't eat away significantly into returns? As a rule of thumb, the net effect of all transaction costs during a year should not exceed 1 per cent of the value of the investment. On July 28, the latest board meeting of Sebi shed some light on transaction costs by announcing a formal transaction charge mechanism for mutual fund investments through agents, where an investor's awareness of the costs they are incurring needs to be enhanced. Broker's cost rokerage rates charged by brokers B and sub-brokers on cash market trades, executed offline or through their internet-based trading platforms, range between 0.3 per cent and 0.75 per cent and are usually on a flat basis with some exceptions, where brokers charge you to a pre-specified minimum amount, if the amount calculated on the fixed percentage rate is less than the minimum amount. The minimum brokerage charge range between Rs 10 and Rs 50 per trade or for a day's bunched trades. For instance, ICICI Securities, through its internet-based trading platform, icicidirect.com, has an `ISecure' brokerage plan that has a 0.55 per cent flat brokerage charge subject to a minimum of Rs 25 per trade. The brokerage amount, however, across all investors of all brokers, cannot exceed the regulatory cap of 2.5 per cent of the trade value. Thus, in the above example of icicidirect.com, the minimum brokerage for a trade value up to Rs 4,545 is Rs 25 or 2.5 per cent, whichever is lower. There are also nominal statutory charges, such as 10.30 per cent service tax on the brokerage amount, securities transaction tax, Sebi turnover charge and NSE/BSE turnover charge, which your broker is legally bound to collect from you. After factoring in these complexities, you arrive at your plexities, you arrive at your brokerage cost. It is important to note that brokerage cost is incurred only when you transact -buy or sell. You do not incur it if you are just holding on to shares bought earlier. DP's cost here is, however, a cost, T attaching to holding your shares in your demat account. Depository participants (DPs) of National Securities Depository (NSDL) and Central Depository Services (CDSL) impose various charges on their investor clients. These include an annual maintenance charge, which varies from Rs 100 to Rs 800 varies from Rs 100 to Rs 800 across DPs for a regular type investor. NSDL allows investors access to a comparative chart of fees charged by its DPs at https://nsdl.co.in/about/dps.php. Although the NSDL makes it mandatory for DPs to provide it with updated fee details, there may be some cases of DPs whose latest revisions may not be reflected in the comparative chart available on NSDL 's website. The Comparative chart to check the annual maintenance charges being levied by some of the largest or significant DPs to their retail clients - Geojit BNP Paribas Financial Services, Rs 400 (with a lower annual maintenance charge of Rs 350 if investor opted to receive statements by email only); HSBC InvestDirect Securities (India), Rs 600 (Rs 300 for digital statements option); HDFC Bank, ranging from Rs 300 (if number of transactions is more than 25 during the year) and Rs 750 (if transactions are 10 or less than 10); ICICI Bank, Rs 500 (Rs 450 for digital statements option); India Infoline Securities, Rs 300; Kotak Securities, Rs 360; Religare Securities, nil for first year and thereafter Rs 400 (Rs 300 for digital statements option); and State Bank of India, Rs 400 (Rs 350 for digital statements option). First of all, the entire genesis of the DP's cost starts from the fact that the depository charges DPs. This then, translates backwards to investors. My belief is that a Rs 250 annual maintenance charge, which is what we levy to our clients, is a reasonable charge for an investor to maintain his demat account. The DPs also levy a transaction charge that an investor has to pay whenever shares get debited or credited in his demat account. Pur chase of shares in the secondary market is settled by way of a credit in the buying investor's demat account, while sale of shares is settled by way of a debit in the demat ac count. Since NSDL does not charge DPs anything for credits, a vast majority of DPs also charge zero for credit. NSDL charges its DPs a flat settlement fee of Rs 4.50 per debit instruction in a DP's client account. The corresponding charge by CDSL on its DPs ranges from Rs 4.25 to Rs 5.50 per debit, depending on the month ly transaction bill amount of a DP. The debit charge levied by DPs on investors range from a minimum of Rs 4.25-5.50 per debit, which is what NSDL or CDSL charges them, up to Rs CDSL charges them, up to Rs 50 per debit. Some DPs levy a debit fee by way of a percentage charge on the value of the sale trade and this ranges from 0.01 per cent to 0.05 per cent. Again, for the same set of DPs considered earlier, the transaction charge per debit arising from a market trade, as given in NSDL 's DPs' comparative fee chart, are as follows: Geojit BNP Paribas Financial Services, 0.02 per cent (subject to a minimum of Rs 15 and a maximum of Rs 40); HSBC In vestDirect Securities (India), 0.04 per cent (subject to a minimum of Rs 25) plus the NSDL rate of Rs 4.50; HDFC Bank, 0.04 per cent (subject to a minimum of Rs 25); ICICI Bank, 0.04 per cent (subject to a minimum of Rs 10/15/30) plus the NSDL rate of Rs 4.50); India Infoline Securities, 0.05 per cent (subject to a minimum of Rs 15 and a maximum of Rs 100); Kotak Securities, 0.04 per cent (subject to a minimum of Rs 21); Religare Securities, 0.02 per cent (subject to a minimum of Rs 30); and State Bank of India, nil for trades done on eztrade.co.in or sbicapsec.com and 0.03 per cent (subject to a minimum of Rs 10 to Rs 30) for others. Investors should aim to keep their transaction charge on debit below the level of the higher of 0.02 per cent or Rs 25 per trade. DPs also levy charges for pledge creation and invocation, dematerialisation of physical share certificates and for failed instructions. Mutual fund's cost f you invest in equities through the I mutual fund route, then your biggest cost is the annual management fee charged by the asset management company running the mutual fund. This is the price you pay for availing of their fund management expertise, and it ranges from 1 per cent to 2.5 per cent. Exchange-traded funds and index funds typically cost the lowest, at around 1 per cent, while the other actively-managed equity funds cost more, up to the statutory maximum of 2.5 per cent. In addition, mutual fund agents through whom investors route their mutual fund transactions, levy a transaction charge that could be as high as Rs 200 per transaction. But in its latest board meeting, Sebi has put a cap of Rs 100 on per-transaction charge (with an additional amount of Rs 50 for a first-time mutual fund investor), and mandated a zero charge for mutual fund investments under Rs 10,000. Given the variety of costs, investors, whether stock pickers or mutual fund buyers, should keep a close watch on the bills he generates on his equity portfolio.

Good credit score can get you loans faster, cheaper Posted: 06 Sep 2011 09:51 AM PDT   Loan repayment history carries highest weightage in the score BANKS would not mind lending at a lower rate as the risk is also low How do banks, from which he has taken no loan earlier, know that Gupta had a poor repayment record. There are big brothers in the form of credit bureaus that keep a tab on the credit behaviour of people. What does a credit bureau do? It receives and shares information on the borrowing and repaying behaviour of people with all lending institutions like banks, nonbanking finance companies (NBFCs), housing finance companies and credit card companies. In India, Cibil is the only official credit bureau now and it has credit records of people in India from the year 2000, when it started operations. What information can one get from a credit bureau? A credit bureau provides credit information and also a credit score to estimate one's creditworthiness. Cibil's credit score, for instance, would range between 300 and 900. A lower score in the 400-500 range, indicates that it is risky to lend to the individual, while a high score in the 800-850 range, means that the borrower is likely to repay the loans on time. What are the benefits of a good credit score?   A good credit score is also a bargaining tool for the individual to get loans faster at better rates. Banks would not mind lending to individuals at a lower interest rate as the risk in lending to the person is also low. While nationalised banks may give about 0.50 per cent discount, multinational banks may even give a 1 per cent discount on loans to people with good credit scores. Who can check the credit information/scores of consumers? Anyone who has taken any form of credit in his life, either a home loan, auto loan or even a credit card, will have his information recorded in the Cibil database. By providing documents like an identity proof, address proof and payment of a small sum (Rs 142 for credit information record and Rs 450 for credit score and credit information record) to Cibil, one can get the details. The credit score and information of a person will be available only to the individual, his present lenders and future lenders, if he has applied for a loan and nobody else. What are the factors that affect one's credit score? The loan repayment history of a person carries the highest weightage on his credit score. Other factors that matter, include the number of credit cards and personal loans that the person has taken. The number of loans that has one applied for, will also matter because it shows the credit-hungry behaviour of the individual and it will be viewed with caution by the lender.

Sale Proceeds of Immovable Property Posted: 06 Sep 2011 09:05 AM PDT    In the event of sale of immovable property other than agricultural land/farm house/plantation property in India by a person resident outside India who is a citizen of India (NRI) or a person of Indian origin (PIO), the authorised dealer may allow repatriation of the sale proceeds outside India, provided the following conditions are satisfied, namely:    (i) The immovable property was acquired by the seller in accordance with the provisions of the foreign exchange law in force at the time of acquisition by him or the provisions of these regulations;    (ii) The amount to be repatriated does not exceed:    the amount paid for acquisition of the immovable property in foreign exchange received through normal banking channels, or    the amount paid out of funds held in Foreign Currency Non-Resident account, or    the foreign currency equivalent (as on the date of payment) of the amount paid where such payment was made from the funds held in Non-Resident External account for acquisition of the property; and    (iii) In the case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties. Immovable property acquired by way of inheritance     A Non-Resident Indian (NRI)/Person of Indian Origin (PIO) may remit an amount, not exceeding US $ 1,000,000 (US Dollar One million only) per financial year out of the balances held in NRO accounts/sale proceeds of assets by way of purchase/the assets in India acquired by him by way of inheritance/ legacy/out of rupee funds. This is subject to production of documentary evidence in support of acquisition, inheritance or legacy of assets by the remitter, and a tax clearance/ no objection certificate from the Income Tax authority for the remittance. Remittances exceeding US $ 1,000,000 (US Dollar One million only) in any financial year requires prior permission of the Reserve Bank.    In cases of deed of settlement made by either of his parents or a close relative (as defined in section 6 of the Companies Act, 1956) and the settlement taking effect on the death of the settler, the original deed of settlement and a tax clearance/No objection certificate from the Income-Tax authority should be produced for the remittance. Where the remittance as above is made in more than one installment, the remittance of all such installments shall be made through the same authorised dealer. Refund of purchase consideration     Refund of application/earnest money/ purchase consideration made by the house building agencies/seller on account of non-allotment of flat/plot/cancellation of bookings/deals for purchase of residential/commercial property, together with interest, if any (net of income tax payable thereon) may be allowed by the authorised dealers by way of credit to    NRE/FCNR (B) account provided the original payment was made out of NRE/FCNR (B) account of the account holder or remittance from outside India through normal banking channels and the authorised dealer is satisfied about the bona fides of the transaction.

Mutual Fund Review: ICICI Prudential Banking and Financial Services Fund Posted: 06 Sep 2011 07:51 AM PDT Scheme Type: Open Ended Equity Scheme Options Available: Dividend and Growth Minimum Amount to be invested: Rs 5000 Entry Load: NIL Exit Load: 1% if the units are redeemed within 1 year from the date of allotment. Systematic Investment Plan: NA Systematic Transfer plan: NA Systematic Withdrawal Plan: NA   Top Stock Holdings in Portfolio: ·                           ICICI Bank ·                           State Bank of India ·                           HDFC Bank ·                           Axis Bank ·                           Punjab National Bank ·                           Allahabad Bank ·                           Bank of Baroda ·                           Sundaram Finance   Contact Details: ICICI Prudential AMC Peninsula Tower, 8th Floor, Peninsula Corporate Park, Ganpatrao Kadam Marg, Off S B Marg, Lower parel, Mumbai , 400013 Tel. No. 022-24997000   Fund Performance:   The scheme delivered a returns of around 20% (Annualized) in the past 1 year (as on January,10,2011) and since inception it has delivered around 25%. This is a consistent good performing mutual fund scheme and has the top banks in its portfolio which would be a very safe and good investment option. Long term investors can go for investing in this scheme.   -----------------------------------------------------------------   Also, know how to buy mutual funds online:   Invest in DSP BlackRock Mutual Funds Online   Invest in Reliance Mutual Funds Online   Invest in HDFC Mutual Funds Online   Invest in Sundaram Mutual Funds Online   Invest in Birla Sunlife Mutual Funds Online   Invest in UTI Mutual Funds Online    Invest in SBI Mutual Funds Online   Invest in Edelweiss Mutual Funds Online   Invest in IDFC Mutual Funds Online

You are subscribed to email updates from Prajna Capital - An Investment Guide To stop receiving these emails, you may unsubscribe now.	Email delivery powered by Google
Google Inc., 20 West Kinzie, Chicago IL USA 60610