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Friday, March 2, 2012

INFRASTRUCTURE BONDS 80CCF 2011-12 - Take additional benefit for Tax Saving



What are infrastructure bonds?

Classified as long-term infrastructure bonds, these are 10- to 15-year debt instruments. Just like a typical loan, these companies borrow money from investors by issuing bonds (to be repaid at a later date) and then lend this money to infrastructure projects. 
Capital raised under these issue is used in infrastructure development projects like projects of National Highways,power plant projects like thermal, hydroelectric power plants and other infrastructure projects

The funds raised through this issues will be utilised for infrastructure lending as defined by the RBI

Following Issues Open  this year 2011-12


Tax saving long term infrastructure bond 2011-2012            

Issue Open Date Close date Details
1 IFCI Infrastructure Bonds series 3  21 Sep 11  14 Nov 11 (close) 8.50% for 10 yrs & 8.75% for 15 yrs. Interest paid Annually
or Cummulitive
2 PFC Infrastructure Bonds 29 Sep 11  04 Nov 11 (close) 8.50% for 10 yrs & 8.75% for 15 yrs. Interest paid Annually
 or Cummulitive
3 IDFC Infrastructure Bond Tranche 1 21 Nov 11 14 Dec 11 (Close) 9% for 10 yrs Interest paid Annually  or Cummulitive  
4 L & T Infrastructure Bond Tranche 1 25 Nov 11  24 Dec 2011 (Close) 9% for 10 yrs Interest paid Annually  or Cummulitive  
5IFCI Infrastructure Bonds Series 430 Nov 118 Feb 2012 (Close)9.09% for 10 yrs & 9.16% for 15 years
6 REC Infrastructure Bond 19 Dec 11
10 Feb 2012
(Close)
8.95% for 10 yrs & 9.15 % for 15 yrs
7 IDFC Infra Bond- Tranche 2 11 Jan 2012
5 Mar 2012 (Close)
8.70% for 10 yrs Interest paid Annually  or Cumulative
8SREI  Infra Tax Saving Bond - Tranche 131 Dec 116 Mar 12 (Close)8.93% for 10 yrs Interest paid Annually or Cumulative
9 L& T Infra Bond- Tranche 2 10 Jan 12 12 Mar 12 (Close) 8.70% for 10 yrs Interest paid Annually  or Cumulative
10PFS Long Term Infra Bond - Series 1
29 Dec 11
27 Mar 12
Close
8.93% for 10 yrs & 9.15 % for 15 yrs
11IFCI  Infrastructure  Bond - Series V29 Feb 1227 Mar 12
Close
8.50% for 12 yrs   & 8.72% for 15 yrs
12PFC Infrastructure Bond Series 8629 Feb 1223 Mar 12 Close8.43% for 10 yrs & 8.72% for  15 yrs
13IDFC Infrastructure Bond Tranche 319 Mar 1230 Mar 12 Close8.43% for 10 yrs
 *** LIC Infrastructure Bonds :   Insurance regulations  allow life insurer to raise only for promoting their core business. That's why LIC Infra Bonds not coming 
 **** SBI Infrastructure Bonds - not file to SEBI - not coming don't wait for this bond



 Income Tax Under section 80 CCF people can take additional benefit  for Tax Saving bonds.


Infrastructure bonds are offered by infrastructure finance companies,with prior approval of Govt. Of India.To promote the infrastructure growth ,,govt have offered investors tax benefit max upto Rs.20,000/-.

Under sec. 80 C you get benefit of  Rs.  1,00,000
 80 CCF  benefit    (Additional Benefit) 
20,000
Total Tax Benefit 
1,20,000


If you are invested  1,50,000 in  80C  you are not eligible for 20,000  (80CCF) benefit 80 CCF allow you to additional  Rs. 20000  in Infrastructure Bonds, and have that reduce from your taxable income in addition to the Rs. 100,000 deduction you get from the other instruments.

.


How much you Save Tax ?




Tax BracketTax SaveCapital InvestmentEffective InvestmentPost Tax Yield (5yrs Buyback)Post Tax Yield (10Yrs)
30.90%6180200001394019.10%15.20%
20.60%4180200001582015.20%12.80%
10.30%2060200001780011.80%10.70%


***  Buy Back after 5 years                   7695  * 4 bonds = 30076
***  Maturity Value  after 10 years     11840  * 4 bonds =  47360

 Interest earned is taxable,all the debt products whether bank deposits,company deposits,debt funds get the same tax treatment and income is taxable in each case.
If you took the annual interest option then the interest will be taxed every year, and if you took the cumulative option then you will be taxed capital gains. The face value of the bond will not be taxed.


Document Required for Bonds Application? 
 1   Pan Card Xerox Copy
2.   Address Proof Xerox Copy ( Passport, Driving License, Voter ID, Ration Card etc...)
3.   Canceled Cheque 


Without D'mat you can Buy Infra Bond........

How do I buy Infrastructure Bonds?


For Investor in Pune - Investment purpose mail me : bonanza42a@yahoo.in or rajendra@puneinvest.com     or   Call  Rajendra  800 775 0904



Feel free to add your suggestions in the comments below.

You might also like this :

IDFC INFRASTRUCTURE BONDS Details --open as on 21 Nov 2011
 L&T -Long Term Infrastructure Bonds 2011B Series (Tranche-2)  Close on  11 Feb 2012
Infrastructure-bonds- FAQ



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6 comments:

Anonymous said...

Thanks for this latest and well compiled info.

T K SUDARSANAM on November 6, 2011 at 11:29 PM said...

THANKS FOR GIVING DETAILS AS EARLY AS POSSIBLE FOR
INCOME TAX INVESTORS FOR THE FINANCIAL YEAR 2011-
2012 AND IT WILL GIVE THE DETAILS ABOUT THE INTEREST ON CUMMULATIE ON SAVINGS.

Rajendra on November 7, 2011 at 12:33 AM said...

thanks for comment I try to post about Saving Interest details early as possible

Infrastructure bonds on November 22, 2011 at 10:30 AM said...

A very well written post and presented decently.

Chirag on November 27, 2011 at 5:24 AM said...

Nice post!
Well I recently heard that even Air India is planing to come up with an infra bond issue, which provides benefit u/s 80CCF..
Is that true?

Rajendra on November 27, 2011 at 8:11 PM said...

No 80CCF Tax Saving Benefit allow..

Long Term Funds may be allowed to be raised through Non Taxable Infrastructure Bonds by the financial institutions for funding in the airport sector.
There may be certain period of lock in for the invested amount.

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