Tax Saving Investment – 2016
Among all the available options, here is your guide to choose the best from Roboadviso
Time has really changed for everything and similarly for tax saving investments. Now we even don’t take help of Google, but just ask – which is the best option to save taxes? To guide you through the available options, Roboadviso will tell you first about all the options and then recommend to put your Rs 150,000/-.
10 Most Famous tax saving options under Section 80C of the Income Tax Act, 1961
These are 10 such options where you can put your money either in one or dividing across many of these. However, it is important for you to check how much risk and time horizon you have. Also, if you can choose based on the overall goal you have for your family and retirement planning, then it will be extremely useful. So, here is the list:
*returns are made comparable. **ELSS- Long term returns are taken
5 Lesser Known tax saving strategies under Section 80C of the Income Tax Act
Home Loan Principle Repayment
The principal component of your home loan, is included under Section 80C, offering a deduction up to Rs. 1,50,000.The interest portion offers a deduction up to Rs. 2,00,000 separately under Section 24.
However, if the property is sold before five years of the purchase, the amount claimed as deduction is taxed in the year the house is sold.
Tuition fees for Children
Tuition fees for up to 2 children are covered under section 80C.
Starting from Play school, Pre-nursery, Nursery to higher classes to University, college & other educational institution fees
Please note that it does not include development fees or donations.
Stamp duty and registration charges
The amount you pay as stamp duty when you buy a house, and the amount you pay for the registration of the documents of the house can be claimed as deduction under section 80C in the year of purchase of the house.
Under this, first-time equity investors can invest up to Rs 50,000 in approved stocks and mutual funds and claim tax deduction on 50% of the amount, or Rs 25,000, under Section 80 CCG of the Income Tax Act.
But to claim this exemption, your income should not be more than Rs 12 lakh a year. you should also have a demat account. You can avail of the tax benefit under the scheme for three years.
Interest accrued in respect of NSC VIII issue
In case you have purchased NSCs during some earlier years, then the accrued interest as per the tables released by authorities is eligible for deductions under Section 80C.
What Roboadviso recommends
We recommend you to buy ELSS out of all the above options. Mutual Funds are rightly placed to invest all your Rs 1.5 Lakhs in (if possible) as stock markets have also fallen significantly and your money will be free after 3 years. Here is our recommended fund:
Axis Long Term Equity Fund: Details
*Performance as on January 28, 2016 **Past performance may or may not sustain in future
Out of 75 tax saving funds (ELSS), Axis Long Term Equity Fund has been one of the consistent fund since its inception. It was launched in December 2009 and it has been able to gather assets to the tune of Rs 7000 Crores, which makes it biggest fund in the category.
Its portfolio is heavy on large cap stocks upto 67% with around 31% in mid cap and just a minimal of 2% in small cap stocks. The fund manager, Mr. Jinesh Gopani (since April 2011) has been managing the fund quite differently with portfolio turnover ratio at just 0.42 times in a year.
Its performance has been the most impressive among the category. It has been able to outperform the category by 5% and the BSE 200 Index by 16% in last three years. It has also been able to contain the fall in recent volatile market (please see above).
To help you invest in Axis Long Term Equity Fund, please visit Roboadviso at www.roboadviso.com or contact us at firstname.lastname@example.org or 9015615190