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Thursday, January 19, 2012

Save Tax Through Infrastructure Bonds


With the dawn of the new year, Saving Tax is something that is running on the minds of every individual in India. People are scrambling around to make investments to avail tax benefits under the various sections of the Indian IT Laws. Sec 80C is one of the most widely used tax saving section which offers tax relief on amounts of upto Rs. 1 lakh every financial year. To know more about the various investment options under which you can save tax using this sec 80C click here.

One of the less known and lesser used sections of the Indian Tax System is Section 80CCF. This section offers tax benefits for investments of upto Rs. 20,000/- every year in qualified Infrastructure Bonds. Infrastructure Bonds or Infra Bonds as they are shortly called are special Bonds that are issued by Banks in India to fund the rapid growth of the Infrastructure Industry in India. In one of my earlier posts titled “Should We Invest in the new Infrastructure Bonds that offer 80CCF Tax Benefits“ we had taken a detailed look at them. You can revisit that post to know more about these bonds by Clicking Here

What are the Current Infrastructure Bond Issues that are open now?

Currently there are 3 Infrastructure Bond IPO’s that are open. They are:

1. IDFC Infra Bonds
2. REC Infra Bonds
3. L&T IFC Infra Bonds


IDFC Infra Bonds:

IDFC Ltd has come up with an issue of Infrastructure Bonds of face value Rs. 5000/- with a minimum investment of Rs. 10000/- or 2 bonds. The issue is open between 11th January 2012 and 25th February 2012. They are offering an interest rate of 8.7% per annum. The lock-in period is 5 years, after which there is a buy-back option and the maturity period is 10 years. To know more about this issue click here.

REC Infra Bonds:

REC Ltd has come up with an issue of Infrastructure Bonds of face value Rs. 5000/- with a minimum investment of Rs. 5000/- or 1 bond. The issue is open between 19th December 2011 and 10th February 2012. They are offering an interest rate of 8.95% & 9.14% per annum for bonds of tenure 10 years and 15 years respectively. The lock-in period is 5 years for 10 year bonds and 7 years for 15 year bonds, after which there is a buy-back option. To know more about this issue click here.

L&T IFC Infra Bonds:

L&T IFC Ltd has come up with an issue of Infrastructure Bonds of face value Rs. 1000/- with a minimum investment of Rs. 5000/- or 5 bonds. The issue is open between 10th January 2012 and 11th February 2012. They are offering an interest rate of 8.7% per annum. The lock-in period is 5 years, after which there is a buy-back option and the maturity period is 10 years. To know more about this issue click here.

All the above issues offer tax benefits under section 80CCF and hence are great opportunities to save an extra amount of tax this financial year.

Happy Tax Saving!!!

1 comment:

  1. Appreciate the info, I asked a lot of these questions to various tax lawyers and las vegas and didn't get the answers I was looking for.

    ReplyDelete

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