Overview
There are various tax saving schemes in India where a individual tax payer can invest and get benefit in income tax. Currently for FY 2012-13, below are the income tax slabs.
|
Taxable amount (INR) |
Tax |
|
0 to 2,00,000 |
Zero tax |
|
2,00,001 to 5,00,000 |
10% tax |
|
5,00,001 to 10,00,000 |
20% tax |
|
10,00,000 + |
30% tax |
However we see that an individual tax payer is in hurry to invest the money in one of the tax saving schemes and forget / ignores what kind of returns they are getting on the amount invested. In case we want to achieve the goal of being financially independent, it is important for us to invest in tax saving schemes which gives maximum returns.
Types of tax saving instruments available for investor/tax payer
Let us identify the tax saving instruments which give highest returns to an investor
|
Scheme |
Time period (Years) |
Expected returns per annum (%) |
Minimum Investment (INR) |
Maximum Investment (INR) |
Ranking |
Factors to be considered |
|
Tax saving Mutual Funds |
3 years minimum |
7% to 17% |
500 |
No limit |
1 |
Depends on market conditions, identifying the best mutual fund is the key |
|
Taxing saving Bank Fixed deposit |
5 |
8% to 10% |
Nil |
100,000 |
2 |
identifying the best & safe bank FD is the key |
|
Public Provident Fund |
15 |
8.8% |
500 |
100,000 |
3 |
Need to wait for longer period |
|
National Saving Certificate |
5 |
8.6% |
100 |
No limit |
4 |
|
|
Govt Tax saving bonds |
6 |
8.0% |
1,000 |
No limit |
5 |
|
You got the list, but how to choose best tax saving scheme would give a maximum returns? It is not that easy to identify such cases. It depends on individual risk taking capacity, time period etc.,
|
Various Best Tax saving Mutual Funds – Returns are annualized |
||||
|
Scheme |
Crisil Rank |
Last 1 Year* |
Last 2 Years* |
Last 3 Years* |
|
ICICI Pru Tax Plan |
Rank-2 |
-4.0% |
3.8% |
16.8% |
|
Can Rebocco Tax equity saver |
Rank-1 |
0.2% |
3.4% |
15.4% |
|
Religare tax plan |
Rank-2 |
-5.3% |
1.3% |
14.5% |
|
Reliance tax saver ELSS |
Rank-2 |
0.5% |
3.2% |
14.3% |
|
Fidelity tax advantage fund |
Rank-1 |
-5.7% |
0.6% |
13.8% |
* as of 30-Jun-12
|
Best Taxing saving Bank Fixed deposits |
||
|
Bank Name |
Scheme |
Interest per annum |
|
Tamilnadu Merchantile Bank |
Tax Saver Scheme – 5 years to 10 Years |
9.50% |
|
Karnataka Bank |
KBL – Tax Planner – 5 years |
9.50% |
|
United Bank of India |
Tax Savings Deposit Scheme-5 years |
9.35% |
|
SBI |
SBITSS-5 years |
9.25% |
|
Canara Bank |
Canara tax saver-5 years |
9.25% |
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Suresh
Myinvestmentideas.com
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good one