Posted: 30 Mar 2015 01:07 AM PDT

The launch of Sukanya Samriddhi Yojana (SSY) by the government for the girl child has sparked considerable interest given its tax benefit and interest rate higher than Public Provident Fund. The SSY offers 75 basis points (bps) higher than the 10-year government bond as against 25 bps by the PPF . For 2014-15, the interest rate for PPF is 8.7% while the SSY offers 9.1%. But, wealth planners believe subscribers should put money in this product along with an investment in equity products. This is because interest rates could fall in the future. Given that the investors are investing for a period estors are investing for a period of 10 years or more, a combina tion of equity mutual funds and SSY will generate better returns. Depending on their risk profile, investors could use SSY along with a combination of equity mutual fundschild funds to meet long-term asset allocation goals for their girl child

Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015

1.ICICI Prudential Tax Plan

2.Reliance Tax Saver (ELSS) Fund

3.HDFC TaxSaver

4.DSP BlackRock Tax Saver Fund

5.Religare Tax Plan

6.Franklin India TaxShield

7.Canara Robeco Equity Tax Saver

8.IDFC Tax Advantage (ELSS) Fund

9.Axis Tax Saver Fund

10.BNP Paribas Long Term Equity Fund

You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds

Invest in Tax Saver Mutual Funds Online -

Invest Online

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For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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Save Income Tax Now

Posted: 29 Mar 2015 11:40 PM PDT

Here are a few tips:

1. Invest in an ELSS: This is definitely one of the easier investments that one can make. However, do evaluate if it fits your risk profile and tenure before you make an investment decision.

2. Invest in PPF: One of the best bets for debt investment in the tax saving section. However, the tenure is quite long, so you must ensure that your tenure matches this product.

Minimum Investment (Rs.)

Lock-in years

Returns

Tax Treatment

Risk Profile

Public Provident Fund (PPF)

500

EEE

Low

National Savings Certificate (NSC)

100

5 to 10

ETE

Low

Bank FD

1000

ETE

Low

Senior Citizens Savings Scheme (SCSS)

1000

ETE

Low

Unit Linked Insurance Plan (ULIP)

25000

10 -15 (Tenure of policy)

Market-Linked

EEE*

Medium

National Pension Scheme (NPS) - Tier 1

6000

Till retirement

Market-Linked

EET

Medium

Equity-Linked Savings Scheme (ELSS)

500

Market-Linked

EEE

High

3. Invest in a 5 year bank FD: It is convenient and easy to invest in this. However, this product makes sense only if you are in the lower tax bracket. The interest on this is taxable.

* EEE stands for exempt, exempt, exempt. Here, the first exempt means that your investment is allowed for a deduction. So, you don't have to pay tax on part of the salary that equals the invested amount. Similarly, the second exempt implies that you don't have to pay any tax on the returns earned during the accumulation phase. The third and final exempt means that your income from the investment would be tax-free in your hands at the time of withdrawal.

ULIPs fall under EEE only on fulfilment of certain criteria.

But before you jump off your seat to start investing, check what your PF contribution has been- this is also a part of investments under 80C. The only reason this has been taken care of is because it was compulsorily deducted from your salary by your employer- so you're that much better off today- you need to invest that much lesser.

If you have existing insurances, those premiums are also deductible under Sec 80C. Yes, the policies you took last year but are paying premiums every

Although there is a list of things that you can do, below is a list of things you shouldn't do:

1. Take an insurance policy: If you're in a rush to save taxes, don't opt for insurance- this decision needs time and consideration and must not be taken in a hurry.

2. Do the same next year.

If your tenure is long term and your risk appetite allows you exposure to equity, you can create a corpus alongside the fixed income retirement portion raised by statutory deductions.

How? At the beginning of every year, estimate the amount you have left over from the Rs 1.5 lakh limit after statutory deductions (EPF), divide it by 12 and start an SIP.

Why? Benefit from EEE – Investment is tax deductible, returns during accumulation phase is tax free, investment is tax free on withdrawal.

They have a shorter lock in period (of 3 years) than comparable alternatives.
Wheel effect – Suppose investments are made in the first three years, in the fourth year, the first year's ELSS investment which is now tax free can be redeemed and re-invested as a fresh investment on which deductions can be claimed. This long-term cycle frees you from making any fresh investment after the initial three years.

Risk: Being linked to the equity markets could create volatility in the returns/value of the corpus invested.

Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015

1.ICICI Prudential Tax Plan

2.Reliance Tax Saver (ELSS) Fund

3.HDFC TaxSaver

4.DSP BlackRock Tax Saver Fund

5.Religare Tax Plan

6.Franklin India TaxShield

7.Canara Robeco Equity Tax Saver

8.IDFC Tax Advantage (ELSS) Fund

9.Axis Tax Saver Fund

10.BNP Paribas Long Term Equity Fund

You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds

Invest in Tax Saver Mutual Funds Online -

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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

Leave your comment with mail ID and we will answer them

You can write to us at

PrajnaCapital [at] Gmail [dot] Com

Leave a missed Call on 94 8300 8300

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

Invest Mutual Funds Online

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any Fund Application Forms

Municipal Bonds

Posted: 29 Mar 2015 10:04 PM PDT

On Sunday, market regulator Securities and Exchange Board of India (Sebi) allowed municipal bodies in India to issue debt securities which could also be listed. According to Sebi, its regulations relating to municipality bonds will provide a "framework governing the issuance and listing of bonds by municipalities and will enable the investors to make an informed investment decision before investing in the bonds issued by such entities".Globally, municipality bonds, also called `muni', are issued to finance capital expenditures like construction of roads, schools, etc. within the administrative limits of these bodies.

Sebi regulations also set disclosure rules for these bonds and could also facilitate listing of privately placed municipal bonds. These regulations confirm to the government's guidelines for issuing tax-free bonds by municipalities.

Sebi rules said all municipal bonds should have a mandatory credit rating, which should be of investment grade in case of public issuances, these bonds should have a three-year tenure and banks or financial institutions should be appointed as monetary agencies which will prepare periodic reports on the issuer.

Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015

1.ICICI Prudential Tax Plan

2.Reliance Tax Saver (ELSS) Fund

3.HDFC TaxSaver

4.DSP BlackRock Tax Saver Fund

5.Religare Tax Plan

6.Franklin India TaxShield

7.Canara Robeco Equity Tax Saver

8.IDFC Tax Advantage (ELSS) Fund

9.Axis Tax Saver Fund

10.BNP Paribas Long Term Equity Fund

You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds