Friday, January 18, 2013

Prajna Capital

Prajna Capital


How to Get Income Tax Refund

Posted: 18 Jan 2013 04:51 AM PST

Tax Saving Mutual Funds Online

Invest Mutual Funds Online

Call 0 94 8300 8300 (India) 
 

Many of us rush at the last moment for making right tax investments, this leads to incorrect disclosure of investments which will ultimately end you up in paying extra taxes. This extra tax paid in addition to actual tax liability leads to a situation of Tax refund.

The process of getting the tax refund has traditionally been very tiring and time consuming for an individual. If you are expecting a
tax refund then it"s important to take a few steps which will expedite the process.

How do I get the Tax refund?

  • Filing the return on time is the first and foremost requirement for claiming the Tax refund, by providing the adequate investment details.
  • File your return online so that it is processed faster and it doesn"t have to deal with bureaucracy. You can file your return online
  • Check your Income tax Return to see if it"s reflecting the tax refund correctly.
  • If your Tax return shows Tax refund, filing the return is all you need to do. The IT department will send the refund by post (cheque) or direct credit to your bank account.
  • You should provide proper details of bank account like MICR Code, bank account number and also the proper address to get the Tax refund amount directly credited in to your account.
  • Opt for direct credit so that you don"t have to deal with postal delays.

Further in a situation where you think that you forgot (to mention bank account no., MICR code of bank) or did not have the proper documents to show the investments made, a Revised Return of Income needs to be submitted.

What if you do not receive Tax refund within a year?

If you do not receive your tax refund within a reasonable time which normally is within a maximum of one year from the date of filing the
tax return

  • Check your Tax Refund status here
  • You can approach Tax Ombudsman which are present in select cities to deal with such cases. The Ombudsman has been empowered by the government to help tax payers and also better the whole tax process.

Thus, to conclude, prevention is better than cure. So it is always better to plan early and prevent paying extra taxes than to wait months to get your refund back.

 

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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

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 Tax Saving Mutual Fund Applications

 

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

 

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

  1. HDFC TaxSaver
  2. ICICI Prudential Tax Plan
  3. DSP BlackRock Tax Saver Fund
  4. Birla Sun Life Tax Relief '96
  5. Reliance Tax Saver (ELSS) Fund
  6. IDFC Tax Advantage (ELSS) Fund
  7. SBI Magnum Tax Gain Scheme 1993
  8. Sundaram Tax Saver

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Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver Mutual  Funds  Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

 

How to choose between different tax-saving options

Posted: 18 Jan 2013 03:35 AM PST

With many types of tax-saving instruments available for individuals, but the amount of investment allowed to avail exemption limited, one needs to plan well. Apart from non-tax factors — return on investment, flexibility to exit, recurring nature of investment, etc — the main tax considerations include tax impact not only at the time of investment, but also on future income and exit from the tax-saving scheme (commonly known as exempt at the time of contribution, exempt at the time of accumulation and exempt at the time of withdrawal).

 

One must look at the lock-in period for investment/exit and the quantum of general or specific limit for investment for tax savings. In the general category, where tax savings are available under Section 80C of the Income Tax Act, 1961, following instruments take a front seat as they are EEE schemes with relatively lower lock-in periods:

 

Equity Linked Savings Scheme is operated by various fund managers where the proceeds are invested in equity shares, with a lock-in of three years.

Employee Provident Fund is a common form of investment often chosen by employees with a minimum lock-in of five years. While the employer's contribution is exempt, investment by the employees is eligible for deduction.

Public Provident Fund is another option, in addition to EPF, where the contributions can be partly withdrawn after seven years and a full withdrawal is possible after 15 years.

 

Unit-linked insurance plans come with bundled benefit of both insurance and flexibility to manage the investment/return where the minimum maturity period would be around five years as the yearly premium cannot exceed 20% of the sum assured.

 

Life insurance has the primary intention of insurance with additional benefit of returns, though at a lower rate. The lock-in would depend on the specific scheme. As regards limits provided to certain types of instruments, additional savings for beyond R1 lakh can be availed by investing up to R20,000 under 80CCF in tax-saving infrastructure bonds. Moreover, R15,000 (R20,000 for senior citizens) is available under Section 80D for mediclaim insurance for self and dependents.

 

In addition, 10% of salary by way of employer contribution to New Pension Scheme under Section 80CCD is exempt, while the employee's contribution is included in the general limit of R1 lakh under Section 80C. Also, R1.5 lakh for interest on loan obtained for investment in self-occupied property (no limit if let out) provides tax exemption. Principal repayment, stamp duty and registration fee for purchase of property would be eligible under the general limit of R1 lakh under Section 80C.

 

While the above schemes are purely from a tax-saving perspective, a holistic view, considering the returns each scheme offers, would have to be considered. While the deadline for saving taxes for 2012-13 is fast approaching (March 31), one has to take out time to plan his taxes if not already done so.


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

  1. ICICI Prudential Tax PlanInvest Online
  2. HDFC TaxSaver Invest Online
  3. DSP BlackRock Tax Saver Fund Invest Online
  4. Reliance Tax Saver (ELSS) Fund Invest Online
  5. Birla Sun Life Tax Relief '96 Invest Online
  6. IDFC Tax Advantage (ELSS) Fund Invest Online
  7. SBI Magnum Tax Gain Scheme 1993 Invest Online
  8. Sundaram Tax Saver Invest Online
  9. Edelweiss ELSS Invest Online

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Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap FundsInvest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap FundsInvest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap FundsInvest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap FundsInvest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector FundsInvest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

Right Size your SIPs in terms of tenure and amount

Posted: 18 Jan 2013 03:10 AM PST

Invest Mutual Funds Online

Call 0 94 8300 8300 (India)
   Systematic investment plans (SIPs) are here to stay. Going by the growing number of SIPs, it does look like investors have taken to them in a big way. Today as much as . 1,000 crore flow into SIPs every month. A SIP, as the name denotes, is a method to invest a fixed amount in a mutual fund at regular intervals --generally monthly or quarterly. It is easy to do and the minimum amount with most mutual funds is a mere . 1,000 per month. You can write post-dated cheques for your investment, or give an auto-debit facility from your bank account. In fact, most investors today prefer setting up an auto debit for their SIPs, since writing cheques is cumbersome. Also, you can choose any tenure that you want for your SIP — six months, one year, five years, 10 years or even opt for a perpetual SIP which will continue forever till you stop it. However, the moot question is what is the ideal tenure of an SIP?

THE TIME FACTOR

Financial planners feel that it is important to run equity SIP for at least five years to maximise returns. "The important part in an equity SIP is to keep running it over a long period of time," says Bhaiya. The numbers speak for themselves. Even if you invested in the worst-performing SIPs and your time-frame was 10 years or 15 years, you would still earn higher returns than a public provident fund (PPF).


The best equity SIP over the past 10 years was on the Reliance Growth Fund. Rupees one thousand invested every month since April 2001 would give you . 10.57 lakh as on March 31, 2011. Interestingly enough, if you had invested . 1,000 every month on the worst-performing SIP, Taurus Discovery, you would have still ended up with . 2.25 lakh, giving you an annualised return of 11.66%, which is more than the 8% return that you could get from a PPF. Now that does not mean that we are recommending that the investor should stop investing in PPF and start doing only SIPs. PPF is a totally different instrument, which is preferred by conservative investors who want the government guarantee and assured tax-free returns. On the contrary, equity doesn't offer any assured returns and it can be extremely risky.


SIP scores over a lump-sum investment since you invest irrespective of the market condition. He recommends investors to do SIPs in diversified equity funds, for long periods of time, typically more than five years.


Also, the advantage of investing irrespective of the state of the market ensures that averaging comes into play and allows the investor to benefit from volatility. Let's consider the last few months: The stock market has been volatile with alternate bouts of ups and downs due to reasons like high inflation and high crude prices. Hence, it is very difficult for retail investors to decide when to invest or to time their investments. By buying more number of units at a lower price (i.e., when the market falls) and lower number of units at a higher price, you average your investments. Suppose the monthly SIP is for . 1,000 and the fund's net asset value (NAV) is . 20. This will lead to 50 units being credited to the investor. However, in the next month, on account of the volatile markets, the fund's NAV falls to . 15. This will lower the average purchase cost; as a result, the investor will have 66.66 units credited to his account. In short, an SIP helps the investor buy more when the stock market is falling and buy less when it's rising.

LINK SIPs TO YOUR GOALS

SIPs work significantly better if wealth is to be created over a long term. They are an excellent tool for investors to build wealth in the early phase of life, especially when they do not have lump-sum money to invest. Secondly, regular savings help build discipline amongst investors. Generally, financial planners recommend you do SIPs for a long duration and link it to your goals. Simply put, when going through the process of financial planning, to meet each goal you could go in for a SIP. For example, if your child's education is 10 years down the line, you could go for a 10-year SIP. So assuming, an engineering course costs . 10 lakh today and assuming an inflation of 8% per annum, the same engineering course could cost . 21.58 lakh, 10 years down the line. Now, in order to meet this expense, you could do an equity SIP of . 10,000 per month. Assuming you get a 12% return on equities, this will grow to . 23 lakh at the end of 10 years, thereby helping you meet your goals. However, if luck is on your side, and you manage to reach the goal earlier, (say in eight years time, due to higher return from equities), you could consider shifting your corpus partly into debt, so that you do not expose your corpus to risk. When you choose to invest via a SIP, you make investments (usually) in smaller denominations at regular intervals as opposed to making a single lumpsum investment. SIPs can be used by investors of virtually all ages, keeping the underlying asset in mind. Just like every other investment, make sure that you also review your SIPs, and take corrective action, if necessary. This will ensure that your investments are on track and you do not miss your goals. Last but not the least, the most important point in SIPs is not to discontinue your SIPs in bad market conditions or when the market falls, as that will defeat the very purpose of investing.

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver Mutual  Funds  Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

 

 

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