Sunday, January 23, 2011

Mutual Fund Systematic Withdrawal Plan (STP): A scientific way of Investments

STP refers to Systematic Transfer Plan where in an investor invests a lump sum amount in one scheme and regularly transfers (i.e. switches) a pre-defined amount into another scheme. This transfer frequency could be weekly, Fortnightly, monthly or quarterly as offered by Mutual fund.

Investors who want to invest lump sum money in schemes with stable returns and ensure small exposure to equity schemes in order to avail of the potential for higher growth through equities.

Tuesday, January 18, 2011

Complete information on Hindu Undivided Family (HUF): An ultimate tax saver

HUF or Hindu Undivided Family is defined under the Hindu Law as a family that consists of all persons lineally descended from a common ancestor, including wives and unmarried daughters. All male adults in the family are called Co-Parceners, and all female members of the family are called Members, and the head of the family Karta (Generally the eldest male).

Who Can Create HUF

Any hindu individual male can create HUF as soon as he gets married to a hindu female. Its not necessary to have children to create HUF. Persons from other religion are not eligible to create HUF except Jain and Sikh who can create HUF even though they are not governed by hindu law.

Monday, January 17, 2011

Subscribe to REC Long term Infrastructure Bonds: Save tax under section 80CCF

Rural Electrification Corporation Ltd (REC), a Navaratna enterprise, has come up with section 80CCF tax saving infrastructure bonds. The issue is open from 12th January to 28th March 2011. 

REC, one of the infrastructure companies which is eligible to float section 80CCF tax saving long term infrastructure bonds, is planning to raise Rs 50 Crore by issuing 1 Lakh bonds, Rs 5000 face value each. 

Sunday, January 16, 2011

IDFC Infrastructure Bond Tranche 2 opening 17 January 2010: Does it make sense to Invest in Infrastructure Bonds

Does it male sense to invest in Infrastructure bond?
If you happen to be in the highest tax bracket then by Investing Rs 20000/- you would get a tax rebate of Rs. 6000/-. Considering you have invested 14000/-(Rs.20000-Rs.6000 tax benefit) then you would be earning 8% interest annualy on Rs.20000/- you would be getting maturity of Rs. 43200/-.So your Rs. 14000/- becomes Rs. 43200/- after 10 years which is more than 3 times offering you Net Yield of greater than 12.5%. This kind of return is not available in any secured & guaranteed Investments.

Applications Supported by Blocked Amount (ASBA): New way to apply in IPO's

SEBI in a Retail Investor's Interest has Introduced new system "Applications Supported by Blocked Amount" (ASBA) Processan additional optional method for IPO application where instead of making payments by cheque, IPO bidding amount remains in investors account, but blocked by the bank until allotment is done. 

This alternate method has been exclusively for retail individual investors through participatory banks (SCSB's). Earlier, many retail investors faced various issues in getting the refund of amount, but Investors applying for IPO through ASBA will not have to face issues like this anymore. Although this system is already in place from May 1, 2010, retail investors are not aware of this and not using this facility.

Tuesday, January 11, 2011

Mobile Number Portability (MNP) Completely Explained: How to Change Mobile Service Operator and FAQ's

The much awaited Mobile Number Portability (MNP) will be finally launched on January 20, 2010. Mobile Number Portability (MNP) has already been launched in Haryana in November last year. The real test for fitness of telecom companies will really start now where in Customer has an option to retain the same number even he wants to change the Service Provider(Operator).


Telecom Regulatory Authority of India (TRAI) fixed the maximum rate of mobile number portability fee at Rs.19. Although Telecom operators are free to charge less than Rs.19 or even offer this service free. Now it is imperative for the Telecom company to offer best Coverage, Connectivity, and quality of service.

Monday, January 10, 2011

Complete Information of PAN (Permanent Account Number)

A permanent account number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by an assessing officer of the Income Tax Department. It is mandatory to quote PAN on returns of income, all correspondence with any income tax authority and challans for any payments due to the Income Tax Department.

Saturday, January 8, 2011

Long Term and Short Term Capital gain in Mutual fund Explained

The difference between the sale consideration (selling price) and the cost of acquisition (purchase price) of the asset is called capital gain. If the investor sells his units and earns capital gains he is liable to pay capital gains tax. 

Capital gains are of two types: 
Short Term Capital Gains
Long Term Capital Gains

Friday, January 7, 2011

Recieved a Tax Refunds mail- Its a SCAM !! Be Careful!!

Recently many of us must have recieved an e-mail stating that there is some amount which is due for refund and in order to claim that money one needs to click a link which takes to Income tax website.


The body of the mail says

"Dear Valued Taxpayer,
We have reviewed your tax fiscal payment for previous months and have resolved that you are qualified to obtain a refund of the sum of 47,320.00 INR which is your accumulated tax excesses. Please submit a tax refund request and allow us to process it within 7 days. 

Tuesday, January 4, 2011

Tax Saving and other Investment option in India Ready Reckoner

I wish All my readers a Very Happy new Year. Since financial year end is approaching fast, we have very less to to invest in tax savings instruments. Please find comparison of various investment options in the form of a ready reckoner.

How to open Online NPS account with ICICIdirect.com and FAQ's

Pension Fund Regulatory and Development Authority (PFRDA) was established by the Government of India on August 23, 2003 to promote old age income security by establishing, developing and regulating pension funds, to protect the interests of subscribers to schemes of pension funds and for matters connected therewith or incidental thereto.

The NPS is a new vouluntary contributory pension scheme introduced by the Central Government . Under the new pension system , individuals can open a personal retirement account and can accumulate a pension corpus during their work life to meet financial needs post retirement. These contributions would grow and accumulate over the years, depending on the returns earned on the investment made. When the person retires, he will be able to use these savings to take care of the needs and expenses of his family during old age.The subscribers may use the accumulated pension wealth under the scheme to purchase a life annuity from a life insurance company. Alternatively, depending on the age of the subscriber, a part of the wealth may be withdrawn as lump-sum.

Saturday, January 1, 2011

Open NPS account online with ICICIdirect.com

PFRDA has now started using technology to distribute NPS which has failed to take of till now. Now they have started offering this product online by tying up with ICICIdirect.com to distribute this product through e channel. Anyone having account with ICICI Direct can apply for this product online and even invest in the form of SIP.

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