SEO Simplified By Gabs Gaurs &amp; Geets

Religare Tax Plan's focus on mid-cap, growth-oriented companies renders it a bit high on risk. However, being a tax plan with the mandated three year lock-in period, it can afford to take these chances as the mid-cap theme is bound to play out over longer tenures. The scheme focuses on investment in niche businesses that are expected to grow in size, and allow these businesses time to grow. If this strategy increases the short term risks, then the presence of blue-chip counters balances the portfolio's risk. The scheme has so far succeeded in outperforming the broader markets on most occasions. Investment here makes sense if it is done with an investment horizon of 3-5 years and the mandated lock-in period does take care of that aspect.

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

HDFC TaxSaver
ICICI Prudential Tax Plan
DSP BlackRock Tax Saver Fund
Birla Sun Life Tax Relief '96
Reliance Tax Saver (ELSS) Fund
IDFC Tax Advantage (ELSS) Fund
SBI Magnum Tax Gain Scheme 1993
Sundaram Tax Saver

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Application form for Tax Saving Infrastructure Bond and more information

Download REC Tax Free Bond Application Forms

Submit filled up application Collection canter near you

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How to apply to REC Bonds?

Apply for REC Tax Free Bonds forms below

Submit the filled up form to Collection canter near you

Chola's new health Insurance plan - Chola Hospital Cash Healthline Insurance Policy

Posted: 13 Mar 2012 03:24 AM PDT

Cholamandalam MS General Insurance Company has launched `Chola Hospital Cash Healthline Insurance Policy', which offers daily cash benefit during hospitalisation.

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

HDFC TaxSaver
ICICI Prudential Tax Plan
DSP BlackRock Tax Saver Fund
Birla Sun Life Tax Relief '96
Reliance Tax Saver (ELSS) Fund
IDFC Tax Advantage (ELSS) Fund
SBI Magnum Tax Gain Scheme 1993
Sundaram Tax Saver

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Application form for Tax Saving Infrastructure Bond and more information

Download REC Tax Free Bond Application Forms

Submit filled up application Collection canter near you

------------------------------------------------
How to apply to REC Bonds?

Apply for REC Tax Free Bonds forms below

Submit the filled up form to Collection canter near you

Infra bond tax gain may stay one more year

Posted: 13 Mar 2012 01:41 AM PDT

The finance ministry may extend tax benefits for investment in infrastructure bonds for one more year. But the limit of~20,000 may not change, despite appeals from the industry.

This would mean a tax saving of~2,000 to~6,200 for an individual, depending on the tax slab.

A finance ministry official said the revenue department was considering allowing income-tax deduction on investments up to~20,000 in infrastructure bonds in Budget 2013 as well. The ministry may also consider allowing some more entities to issues such bonds, but it is not in a position to raise the cap, given its tight fiscal situation and bleak revenue prospects.

The government is struggling to meet its tax and non-tax revenue targets. Net direct tax collections in the first nine months of the year (April-December 2011) stood at~3,23,955 crore, which is just 61 per cent of the Budget Estimate of~5,32,651 crore for 2011-12. This leaves the revenue department with the Herculean task of collecting~2,08,696 crore in the remaining three months.

Section 80CCF of the Income Tax Act makes an investment in infrastructure bond eligible for tax deduction. This is in addition to the deduction of~1,00,000 allowed under Sections 80C, 80CCC and 80CCD of the Act.

The deduction was first allowed in Budget 2010-11 for meeting the dual objective of encouraging savings and meeting long-term needs of the infrastructure sector. The benefit was allowed in Budget 201112 also, but the government did not increase the ceiling despite demands from the industry.

In 2010, the government had allowed Life Insurance Corporation, Industrial Finance Corporation of India (IFCI), Infrastructure Development Finance Company (IDFC) and any non-banking finance company classified as infrastructure finance company by the Reserve Bank of India — such as L&T Infrastructure — to issue tax free infrastructure bonds.

In Budget 2011, the government also allowed National Highways Authority of India (NHAI), Indian Railway Finance Corporation and Housing and Urban Development Corporation Ltd to issue such bonds. This year, NHAI, IFCI, L&T Infra, IDFC, Power Finance Corporation, Rural Electrification Corporation and SREI Infrastructure Finance have raised long-term funds through issuance of these bonds.

A recent pre-Budget meeting with Finance Minister Pranab Mukherjee saw banks reiterating their long-standing demand of allowing them to issue tax-free infrastructure bonds to support long term funding needs. They also sought special incentives for those investing in infrastructure bonds, and asked for clarity and broadening of the definition of infrastructure.

The tenure of tax-free infrastructure bonds is a minimum of 10 years with a lock-in period of five years. Any company raising money through such bonds is not allowed to offer any interest rate that is higher than the yield of 10-year government bonds.

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Application form for Tax Saving Infrastructure Bond and more information

Submit filled up application Collection canter near you

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Muthoot Finance NCD Application Forms

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

HDFC TaxSaver
ICICI Prudential Tax Plan
DSP BlackRock Tax Saver Fund
Birla Sun Life Tax Relief '96
Reliance Tax Saver (ELSS) Fund
IDFC Tax Advantage (ELSS) Fund
SBI Magnum Tax Gain Scheme 1993
Sundaram Tax Saver

------------------------------------------------
How to Muthoot Finance NCDs ?

Apply for Muthoot Finance NCDs forms below

Submit the filled up form to Collection canter near you

Indexation can get you higher returns

Posted: 12 Mar 2012 07:42 PM PDT

Most of us look at a multitude of parameters before investing, such as safety of capital, returns and l i q u i d i t y. However, we tend to ignore the reality of inflation. As prices for goods and services rise over a period of time, the value of one's investment decreases.

For instance, if the average inflation rate over the holding period of an investment is 6%, then investment returns must necessarily be above 6% to generate positive inflation adjusted returns.

In a high-growth and high-inflation economy like India, debt instruments are most affected by inflation as their returns are generally range-bound — between 8% and 10%.

Indexation is an option available for investors to manage their inflation-adjusted returns. It is a provision in the Indian Income Tax Act that allows investors to use inflation as a tool to reduce their tax liability from income generated through debt mutual funds and bonds.

The indexation benefit applies if such investments are held for more than 12 months. The same does not apply to bank fixed deposits and other small savings where the interest earned is taxed as per the applicable marginal tax slabs of 10%, 20% and 30%.

How does indexation work?

Let us take the example of a debt mutual fund with a holding period of greater than 12 months. The tax applicable is called long-term capital gains tax, where indexation benefits are applicable. Under the provisions, the purchase price of the investment is inflated to include the inflation rate over the holding period.

This reduces the effective taxable capital gains component, thus lowering tax outgo. Investors have a choice of either using or not using this indexation benefit, wherein the tax is calculated at 20% using indexation and at 10% without using indexation. The method which gives a lower tax outgo is ultimately chosen.

The inflation over the holding period of the investment is calculated using a government-notified factor, called the cost inflation index. The index uses 1981-82 as the base year where the value of the index is 100. This index is disclosed after the end of every financial year.

New Direct Taxes Code (DTC)

According to the new DTC proposed to be implemented by April 1, 2012 (if ratified by the Parliament), indexation benefits would continue but the tax rates would be modified to the marginal rates of 10%, 20% and 30% as applicable instead of 10% without indexation and 20% with indexation now.

Further, an investment needs to be held for one complete financial year to qualify for long-term capital gains and/or indexation benefits.

Thus, an investment which may be held for 13 months, say from January 2012 to February 2013, will not qualify for indexation due to this reason.

However, an investment held from March 2012 till April 2013 will qualify. Capital gains post indexation would be taxed at 10%, 20% and 30%, based on one's income tax slabs.

However, clarity is awaited on whether DTC would be applicable to prospective investments or whether retrospective investments would also be covered (wherein the end date is covered under DTC but not the starting date).

AN EXAMPLE OF INDEXATION

An investment of Rs 1,00,000 in a debt mutual fund in the financial year (FY) 2007-08 and sold at Rs 1,40,000 in FY 2010-11 would result in a capital gains of Rs 40,000 and a long-term capital gains tax of Rs 4,120 @ 10.30% (including 3% cess), without using indexation. If we consider indexation using cost inflation index of 551 in 2007 and 711 in 2011, the inflated purchase price would be Rs 1,00,000 X (711/551) = Rs 1,29,038.

Hence, capital gains post indexation would be lower at Rs 10,962 (Rs 1,40,000 less Rs 1,29,038). Long-term capital gains tax with indexation would thus be Rs 2,258 (20.60% of Rs 10,962, including 3% cess). Thus, the investor saves Rs 1,862 (Rs 4,120 less Rs 2,258) by using the indexation benefit.

Here, the average inflation over the four-year period according to the cost inflation index is 6.58%. However, if the inflation rate was lower at, say, 4% over this period, it would be beneficial to avail capital gains tax @ 10.30% without indexation. Thus, indexation benefits are useful where inflation has been high during the investment period.

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Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs