Best Tax Saving Schemes in India for 2012
There are various tax saving schemes in India which can be invested for 2012 and get the highest returns. Investing in best investment options is key to grow the hard earned money. There are various investment categories under which we get tax exemption under Section 80C of Income Tax Act, 1956 in India.
Quick list of tax saving investments categories
- Equity linked saving schemes
- Fixed deposit
- Infra bonds
- Life insurance
- NSC
- PPF
- ULIP
Various tax saving schemes in India for 2012
Equity tax saving mutual funds /Equity linked saving schemes are the investment plans where an investor get tax rebates. Below are the top equity tax saving mutual funds based on the performance of 3 years returns.
Tax saving Bank Fixed deposits: Tax saving fixed deposits are available for the period of 5+ years. One can invest upto Rs 1 lakh in these Tax saving fixed deposits to avail tax benefits. Below are the top tax saving bank fixed deposits available currently.
Infrastructure Bonds: These are the various companies who issue infrastructure bonds for taxing saving purpose. These bonds are issued typically during Jan to Mar period to attract the tax payers who look for tax saving investments during that time.
Life insurance: We know that the premium paid for life insurance is exempted from tax. An investor should not be confused with investment Vs life insurance. We would cover separate post on choosing the best life insurance policies with lesser premiums.
National Savings Certificates (NSC): Below are the features of NSC.
- NSC VIII Issue (5 year) – Interest rate of 8.6% p.a
- NSC IX Issue (10 year) – Interest rate of 8.9% p.a.
- Min investment Rs 100. No max.limit.
- No TDS
- Investment up to Rs 1,00,000 p.a. qualifies for Income Tax Rebate
Public Provident Fund (PPF) : Below are the features of investments in PPF.
- Interest rate of 8.8% p.a.
- Min. deposit is 500/- p.a.. Max Rs 1,00,000/- p.a.
- Duration 15 years
- Investment up to Rs 1,00,000/- p.a. qualifies for Income Tax
- Interest is tax-free.
- Deposits can be made in lumpsum or in 12 installments but minimum of Rs 500 is mandatory in each financial year
- Withdrawal is available from 6th year
Unit linked insurance plan: Under unit linked insurance plans, part of the insurance premium would be invested in equity stock markets by the insurance companies, so that an insurer gets higher returnrs at the maturity time. This is due to the fact that investments in stock markets for long term was always appreciated with excellent returns. One of the schemes floated by Life insurance corporate ltd was money plus some time back and some of the insurance agents indicated that the amount would be grown 20 times in 20 years for insurance premium paid . This was based on the indication that stock markets have grown 15% annually in the last 10 to 15 years and this was a real fact.
Conclusion: The above are only the tax saving tips. Thought there are various best tax saving schemes in India, choose a tax saving investment which matches your requirement. Your requirement should clearly state the period of investment for which you can hold them.
Readers, are you investing in these best tax saving schemes in india ? What other tax saving investment schemes are you investing? Please give your comments
If you found this article is good, share the link in Twitter/Face book. The links are provided below.
Suresh
Myinvestmentideas.com
- 11% Nido Home Finance NCD – Sep-2024 – Details, Interest Rates and Review - September 17, 2024
- Difference Between Pure Term Plan and Term Plan with Return of Premium - September 10, 2024
- Bajaj Housing Finance IPO – Details, Review and Analysis - September 8, 2024
Kindly tell me the best tax saver sip and how much amount is ideal to invest. Am earning 50k per mnth.
Srinivas, Check this link where I recommended top ELSS funds. https://myinvestmentideas.com/2013/11/top-5-tax-saving-mutual-funds-elss-in-india-to-invest-for-2014/