National Pension System (NPS) is an initiative of Pension Fund Regulatory and Development Authority (PFRDA), the apex body established by Government of India to regulate and develop the pension sector. NPS has been extended to all citizens of India with effect from 1st May 2009. To extend the coverage of NPS to the weaker and economically disadvantaged sections of the society with their limited investment potential, PFRDA has introduced NPS-Lite which specifically targets the economically disadvantaged sections of society and promotes small savings during their productive life. It aims at building up a corpus sufficient enough to buy an annuity for their old age.
Tuesday, September 28, 2010
Monday, September 27, 2010
NPS Swavalamban Scheme: Operational Guidelines The Scheme and its applicability
The Government of India has approved the Operational Guidelines for the Swavalamban Scheme which was announced in the Finance Minister’s Budget speech of 2010-11. The Scheme is applicable to all citizens in the unorganised sector who join the New Pension Scheme (NPS) subject to their meeting the eligibility criteria. Under this Scheme, Central Government will contribute Rs.1000 per year to each NPS account opened in the year 2010-11 and for the next 3 years, i.e., 2011-12, 2012-13 and 2013-14. To be eligible, a person will have to make a minimum contribution of Rs. 1000 and maximum contribution of Rs.12000 per annum, for both Tier-I and Tier-II accounts taken together.
Saturday, September 25, 2010
Revised Standard Know-Your-Client (KYC) norms and non-acceptance of Third Party payments for mutual fund subscriptions
We would like to bring to your attention the following two important changes being implemented in the mutual fund industry.
1. Revised Standard KYC norms effective October 1, 2010 for certain category of investors
As you would be aware, mutual funds are required to formulate and implement a client identification program as well as verify and maintain records of the identity and address(es) of investors in accordance with the Prevention of Money laundering Act, 2002 („PMLA‟) and SEBI guidelines. Association of Mutual Funds in India (AMFI), along with all mutual funds, has made arrangements with CDSL Ventures Ltd (CVL) to undertake the centralized record keeping of KYC documents. On completing a one-time process of common standard KYC with CVL, investors can transact across multiple mutual funds without having to repeatedly submit documents with each mutual fund.
Friday, September 24, 2010
New Direct tax Code effect on Non Resident Indians (NRI's): Do they need to fear?
I have already covered effects of New Direct Tax Code on Individuals in my earlier post. However, I received numerous mails from all over the world seeking clarifications regarding the NRI definition as per New Direct Tax code and its Tax implication on their overseas income.
In the last month I have seen various headlines in Every news website as well as News Channels that new Direct tax Code may hit NRI’s badly as “More NRIs may fall under the tax net if the Direct Taxes Code (DTC) Bill proposal to impose a levy on their global income if they stay in India for more than 60 days in a year is approved by Parliament.” This has been highly misinterpreted as it doesn’t not says exactly what has been mentioned above. You will be surprised to know that even in Income tax act 1961 under Section 6 it said the same thing. Its really surprising that this has been published incorrectly by even most reputed media houses in India, and till date no one has pointed it out.
In the last month I have seen various headlines in Every news website as well as News Channels that new Direct tax Code may hit NRI’s badly as “More NRIs may fall under the tax net if the Direct Taxes Code (DTC) Bill proposal to impose a levy on their global income if they stay in India for more than 60 days in a year is approved by Parliament.” This has been highly misinterpreted as it doesn’t not says exactly what has been mentioned above. You will be surprised to know that even in Income tax act 1961 under Section 6 it said the same thing. Its really surprising that this has been published incorrectly by even most reputed media houses in India, and till date no one has pointed it out.
Monday, September 20, 2010
New Direct Tax Code effective 2012: How it effects Personal Finance: completely explained
In the year 2009, Government had announced the New Direct Tax Code (DTC) from 01/04/2011. This announcement had created a big hype and also talked about simplifying our Tax structures. Initially it talked about replacing EEE(Exempt Exempt Exempt) regime i.e. Exempt at Contribution, Exempt at accumulation and Exempt at withdrawal with EET (Exempt Exempt Taxed) regime i.e. all savings and investments would be taxed at the time of withdrawal. Income tax Slabs were proposed to be significantly higher from present which would have resulted in much lesser tax outflow.
Saturday, September 18, 2010
Value-averaging Investment plan: A revolutionary way of Investing ( Part2 )
How do I implement VIP?
In today’s time, I have not seen any product in the market which gives us VIP product. Hence we will have to implement it ourselves only. You can take the help of the VIP calculator and manually invest the desired amount according to the Risk variable (Coefficient) chosen by you.
Wednesday, September 15, 2010
Provident Fund Interest raised 1%(100 basis points)
Its great news for all Public and Private sector employees in India. The Provident Fund Trustees today decided to give a higher interest rate of 9.5 per cent for 2010-11 on their retirement savings.
This hike 100 basis points (1%) has taken the interest on PF deposits of 4.71 crore (47 million) people working in organised sector from the current level of 8.5 per cent. The decision to raise the interest rate was taken by the Central Board of Trustees in favour of the employees, due to rise in Interest rates in recent times.
This hike 100 basis points (1%) has taken the interest on PF deposits of 4.71 crore (47 million) people working in organised sector from the current level of 8.5 per cent. The decision to raise the interest rate was taken by the Central Board of Trustees in favour of the employees, due to rise in Interest rates in recent times.
Wednesday, September 8, 2010
Value-averaging Investment plan: A revolutionary way of Investing ( Part1)
Value-averaging investment plan (VIP) is a new method of systematic monthly investment which is slightly different from Systematic Investment Plan (SIP). In VIP the monthly contribution amount varies from month to month unlike SIP depending on the market performance. The concept is very simple, Increase your contribution when last month return is less than expected and decrease your contribution when last month return is more than expected.
Thursday, September 2, 2010
Do safe Online shopping with the Virtual Credit Card
Do you prefer not to do online shopping due to online security concerns that your Credit Card details might be exposed and misused? Next time you dont have to bother about this with the presence of The Virtual card offering involves generation of a virtual card number that you set up using your existing physical credit card or debit card. You can then use this virtual card number to shop online at any merchant website.
What are the unique features of Virtual Cards?
- The actual credit/debit card number is never used in the online transactions. Therefore, there is no risk of the actual card number getting exposed during the online transaction or on the merchant website.
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