Debt Investment Options In India

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

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

CPs, CDs may get to trade on bourses

The Securities and Exchange Board of India (Sebi) is planning to allow certificates of deposit (CDs) and commercial paper (CP) with residual maturities of 60 days or less on the exchange platform.

This step is seen as a precursor to the mark to market (MTM, revaluing assets at current worth) requirements for mutual funds (MFs), to be implemented from Day 1. Last week, Sebi brought down the threshold for MTM of debt securities by MFs to 60 days from 91 days.

Sebi wants to take it to Day 1. At present, it is difficult to draw yield curve maturities below 60 days. In the normal course, the short-term yield curve has to be upward sloping. But, since prices are not transparent, we have a flat yield curve.

A CD is a time deposit with a bank. CDs are generally issued by commercial banks and can be bought through brokerages. They bear a specific maturity date, a specified interest rate and can be issued in any denomination, much like bonds.

CP is a short-term debt instrument issued by companies. These, typically, bear coupons marginally higher than that of CDs. At present, in the absence of transparent pricing in the over-the-counter (OTC) market, it is difficult to decipher a fool proof valuation mechanism for these instruments. If it's on an exchange platform, prices can be seen by everyone and it will be easier to draw a curve.

At present, these instruments are traded privately but the trades are reported on the exchanges. The move would be good in the long term. Post-trading reporting is of no great use. If the instruments are actually traded and reported on a real time basis, it will be of great value. This mechanism will make the Net Asset Values (NAV) more realisable. Investors can be sure the NAV they see is what they get, both while purchasing and redeeming. It is important to build the peripheral infrastructure to make the exchange mechanism successful.

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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

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

Application form for Tax Saving Infrastructure Bond and more information

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

Make tax saving part of your overall financial plan

IT IS January, and most companies would have asked their employees to submit their tax-saving proofs immediately. One of the common mistakes most tax savers make is they buy a product that helps them save tax without being sure what they can expect out of that product. For them, saving tax as a goal becomes more important than the potential benefits or returns the investment could provide.

Subsequently, tax savers who have not been able to make their investment in a tax-sensitive and investment-friendly manner will want to sell or close their investments as soon as possible. This would not provide the desired expectation out of the investment.

It is, therefore, important to include tax saving as a part of the overall financial plan. While taxes are inevitable, a smart tax plan will reduce the impact of tax on the income. When planning for investment in tax-saving products, one must consider the need, duration and amount of investment. There are some expenses also which provide tax benefit. The in come tax act provides for tax savings under various sections namely Section 80C, 80CCF and 80D (Please see Table 1). We describe below the maximum and some smart tax saving plans to consider this year.

Consider the amount you need to save under section 80C: Salaried employee's contribution to the employee provident fund (EPF) is an eligible tax-saving investment under Section 80C. As this is a compulsory deduction, this should be the first investment to be considered.

The choices mentioned are also available in case the EPF does not cover the full investment required.

The choice of investment should be made with respect to the overall financial plan of wealth generation and protection. The options also allow for a well thought-out asset allocation strategy.

Ulips: Unit-linked insurance plan (Ulip) is the only investment option that provides tax benefits, risk cover and market-linked returns. Also, any proceeds from such Ulip would come under the ambit of Section 10(10D).

ELSS: It is the tax-saving schemes of mutual funds.

These funds provide a deduction at the time of investment and dividends and capital gains (on sale of units) arising out of income from ELSS are fully tax-free. ELSS also has the least lock-in period of three years.

Tax savers who are looking for a fixed income and capital appreciation should consider investment in PPF , NSC or tax savings bank deposits.

On fully utilising the deductions allowed under Section 80C, consider additional deduction under Section 80CCF: The income tax act allows for an additional deduction up to Rs 20,000 for investment in `long-term infrastructure bonds' under Section 80CCF. These investments have a minimum lock-in period of five years and the investor is liable to pay tax on the interest received. Investment in these bonds can be considered as fixed income as they offer a fixed return of about 9 per cent.

It is suggested that investment in the bonds should be made only on utilising the deduction available under Section 80C as those investments offer benefits of market-linked returns, low lock-in period and a tax-free return in most cases.

With medical expenses on the rise, a health insurance policy is not only an important tax saving option but also an ideal tool that provides adequate health cover for family as well as ageing parents: Health insurance provides security against unanticipated hospitalisation expenses. The income tax act provides for additional deduction on purchase of health insurance. A maximum of Rs 35,000 is allowed as a deduction as under: Rs 15,000:

Premium for policies on spouse, children and self Rs 15,000: Premium towards policies for dependent parents (Rs 20,000, if parents are senior citizens) The above options provides an opportunity to make the most of the tax saving solutions to take control of the basic goals of securing life, health expenses and wealth generation along with an asset allocation investment strategy. A smart tax planning should, therefore, be a part of the overall financial plan that can minimise the tax outflow and provide opportunity for wealth creation, protection and asset allocation for the overall financial objectives and long term goals.

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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

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

Application form for Tax Saving Infrastructure Bond and more information

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

UTI Mutual Fund New Fund - UTI Fixed Term Series XI – II

UTI Mutual Fund has announced the launch of new fund offer (NFO) of UTI Fixed Term Series XI - II (400Days). The NFO will be open for subscription only on February 27, 2012.

The maturity date will be April 2, 2013.

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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

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

Application form for Tax Saving Infrastructure Bond and more information

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

REC Bond Update

The Union government has reduced the cap on subscription by retail investors in the ~3,000-crore tax-free bond issue of Rural Electrification Corp (REC) to ~1 lakh, from ~5 lakh that was allowed for previous such issues.

A notification dated February 14 issued by Central Board of Direct Taxes (CBDT) clearing the issue has said that "any individual investing over ~1 lakh will be classified as high net worth individual (HNIs)".

All previous tax-free bond issues from National Highways Authority of India (NHAI), Power Finance Corp, Housing and Urban Development Corp, and Indian Railway Finance Corp allowed retail investors to invest up to ~5 lakh.

Some investors feel the move will unduly help HNIs and institutions garner a better share of the issue. Arun Kejriwal, director, Kejriwal Research and Investment Services said, "The unsubscribed retail portion, which is going to be significant, will be cornered by the larger investors." Kejriwal also said the move is an infringement of the market regulator's territory. "Securities and exchange Board of India (Sebi) has the jurisdiction over public issues of both debt and equity. How can a tax authority or an individual company decide unilaterally who is a retail investor? If at all CBDT wants to change, it has to do it through Sebi." In 2010, Sebi doubled the limit for retail investors to ~2 lakh.

REC's tax-free bond issue is likely to open on March 5. Ajay Manglunia, senior vicepresident, Edelweiss Securities, said, "The move will impact retail participation. Most of the retail investors were investing ~5 lakh in these bonds, now if the limit is reduced to ~1 lakh you will need much more applications, which could be tough to get." According to Manglunia even in equity offerings, where the risk is much higher and the issues are relatively smaller, retail investors are allowed to invest up to ~2 lakh. "Considering this, the retail quota for bond issues has to be much higher," he added.

Analysts say the government move followed reports of misuse of retail quota by HNIs.

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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

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

Application form for Tax Saving Infrastructure Bond and more information

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

Hallmarking jewellery and Its effect

According to the Bureau of Indian Standards (BIS), hallmarking is the accurate determination and official recording of the proportionate content of precious metal (gold or silver) in articles. It ensures 92 per cent purity of gold ornaments. Hallmarks are, thus, official marks used in many countries as a guarantee of purity or fineness of precious metal articles.

Jewellery hallmarking provides a third-party assurance — that a buyer is getting the right purity of gold or silver jewellery for the given price. Many buyers get their jewellery re-checked by a third party — BIS — to confirm the purity of the piece. Now, the hallmark will be a certification for such individuals." Many jewellers like Gitanjali Gems, Tanishq and Waman Hari Pethe already provide hallmarked jewellery. In 2007, hallmarking was made mandatory in four metro cities. "Last time," says Mehul Choksi, CMD of Gitanjali Gems, "it got deferred for other cities because not everyone had the right infrastructure to hallmark jewellery. This time they will make it mandatory for jewellers across the country." Importantly, lack of proper infrastructure has made hallmarking expensive in India. This, in turn, pushes up your cost of jewellery — both readymade and customised ones.

Hallmarked jewellery also helps when you need to sell or exchange jewellery. Jewellery buyers are often told the piece of jewellery being bought is 22 carat. Only when selling or exchanging does the individual discover the jewellery piece was only 18 carat. Many lose money this way. Industry experts say this problem also arose due to the lack of suitable solders for high-carat jewellery, preferred in India. Higher the caratage, softer the metal, and it can bend or break easily. Such jewellery needs soldering and the solder alloys used are of a much lower caratage, leading to undercarating.

Then, there is adulteration by addition of too much alloy and selling gold or silver-coated articles with base metal cores. These frauds still continue at least in the local jewellery market.

If you have not bought from the jeweller whom you approach for selling/exchanging, he will weigh the caratage, tally it with the hallmark and pay according to the weight. There are chances the weight then varies slightly from that when you had bought the jewellery, especially if you've worn it regularly.

Old jewellery can also be hallmarked. This is advisable if you are giftingl.

You will have to approach aBIS-recognised assaying and hallmarking centre to get it done. At the centre, the jewellery will be checked for caratage and hallmarked accordingly.

This, even if you were told a different purity when you had bought it.

BIS-recognised assaying and hallmarking centres charge for hallmarking. It differs from piece to piece and according to weight.

"BIS-recognised centres have been advised to charge for gold ~18 an article and a minimum charge for a consignment shall be ~100," according to a BIS statement.

But, jewellers may charge you based on the type and weight of the jewellery.

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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

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

Application form for Tax Saving Infrastructure Bond and more information

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

Know your real need before buying Insurance

Usually people buy insurance without a real understating of why they do so. In my financial planning practice, when I ask people the reason for buying multiple life insurance policies before they approach me, some common answers received are, that it was recommended by a colleague, they learnt about it through a TV commercial as best tax-saving instrument or bought it under obligation from friend or relative. Study confirms that life insurance policies bought just for tax planning and without keeping any financial goal in mind are surrendered before its due maturity.

Basic objective of insurance is to manage financial risk. Different kind of risks can be personal risks like premature death, poor health and old age without having sufficient income or property and liability risk. There are various forms of insurance to manage these risks, and the objective of all is to protect people against unexpected loss. Most common type of insurance are life insurance, health insurance, critical insurance, personal accident and property insurance like motor or home insurance.

Premium towards your life insurance and health insurance policies qualify for deductions under Section 80C and 80 D of Income Tax Act, respectively, but that should never be the objective of buying insurance policy. If tax-saving is your objective, then there are much better schemes that provide you higher liquidity and returns. Insurance policies are not good investment options as they fail to create wealth due higher cost involved in them.

Objective of life insurance is to provide financial support to the family in case of untimely death of the life assured and therefore, life insurance should be bought on the life of the bread winner and not on the life of spouse or children. If spouse is also an earning member and is contributing to household expenses then he/she may buy life insurance policy on his or her life. Money received through life insurance claim can be used for repaying the debt, can be invested to manage household expenses of your family members and to achieve your other financial goals like children education and marriage. Pure term insurance policies best serve this purpose.

Term insurance plans do not offer you any maturity benefit, but these are the best plan as they offer high death benefit against the small premium you pay.

There are also other type of life insurance plans like endowment plan and unit-linked insurance plan (Ulip). Endowment and Ulips are basically combination of insurance and investment.

Insurance company invest the premium in different assets like stocks, bonds or government securities after deduction of insurance charges referred as mortality charges and other charges towards marketing and administrative expenses. In a Ulip, there is a transparency about these charges, but in an endowment plan, there is no transparency about these charges. But in any case a part of your premium is used for investment after adjusting these charges, and therefore, your returns from your policy will depend on these charges and performance of underlying asset in your policy.

Before buying a life insurance policy you must do the proper insurance need-analysis. To determine the sum assured under your life insurance policy, you can calculate the present value of your future expanses like household expenses, children school fee, cost of higher education, children's marriage, and various other financial goals you have in your mind. The inflation and future returns should be considered, assuming that insurance proceeds will be invested in some savings scheme.

You should also add your loan outstanding to analyse the need of life insurance cover.

Objective of health insurance is to cover health care expenses which include doctor's fee, room and ICU charges, medicines, pathology and other expensive diagnostic tests during hospitalisation. Though, it is difficult to ascertain that which problem may strike your health in future, yet sum insured under a health insurance policy can be determined by the factors like your lifestyle, occupation, cost of health care in the city you live and your affordability to the premium. You must check the features like sub-limits under your health insurance policy, network hospital of the insurer, terms of renewability and exclusions under your policy.

To conclude, I say that insurance policy must be bought with proper planning and keeping long-term objective.

Insurance is a complicated product and you need time to understand it. If you are in hurry of submiting your investment proof for claiming deduction in your income, I suggest not buying insurance policy. Take some time to analyse your insurance need and under the products well before you enter in a long term contract.

Adjusting these charges, and therefore, your returns from your policy will depend on these charges and performance of underlying asset in your policy.

You should also add your loan outstanding to analyse the need of life insurance cover.

To conclude, I say that insurance policy must be bought with proper planning and keeping long-term objective.

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

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

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

Application form for Tax Saving Infrastructure Bond and more information

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

Section 80 DDB for Treatment of Specified diseases

Costs incurred for treatment of specified illnesses, could fetch you a tax benefit under section 80DDB.

Available Deduction - For individual assesses less than 65 years of age, a deduction limit of Rs. 40,000 is applicable. For a senior citizen, the limit is Rs. 60,000.

Scope of Deduction - Deduction is applicable for treatment of self, spouse, children, siblings, and parents, wholly dependent on you.

Diseases covered

a) Neurological Diseases (where the disability level has been certified as 40% or more).

b) Parkinson's Disease

c) Malignant Cancers

d) Acquired Immune Deficiency Syndrome (AIDS)

e) Chronic Renal failure

f) Hemophilia

g) Thalassaemia

Key Factors

If you are already receiving any reimbursement for the treatment from your insurance company or employer, deductions cannot be claimed. If you are receiving partial reimbursement, the balance amount can be used for a deduction.
A certificate would be required from a specialist working in a government hospital, as proof for the specified ailment.

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

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

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

Application form for Tax Saving Infrastructure Bond and more information

Submit filled up application Collection canter near you

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

Apply for REC Tax Free Bonds forms below