Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: Central Excise rule to resale the machines to a new company :: empanelment :: cpt :: VAT RATES :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: due date for vat payment :: TDS :: list of goods taxed at 4% :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT Audit :: ACCOUNTING STANDARDS :: ACCOUNTING STANDARD :: articles on VAT and GST in India
Direct Tax »
 Salaried taxpayers to get SMS alerts for TDS deductions
 Salaried tax payers to get SMS alerts on TDS deductions
 Mumbai zone direct tax collection flat in H1 FY17
 CBDT issues final rules for taxing share buy back by companies
 CBDT issues final rules for taxing share-buyback
 The direct tax collections up to September, 2016 are at Rs. 3.27 lakh crore which is 8.95% more than the net collections for the corresponding period last year.
 IDS is tremendous success: CBDT chief Rani Singh Nair
 Submit monthly data of appeals disposed of: CBDT to officers
 Direct tax mop-up jumps 9 per cent in H1, indirect tax up 26 per cent
 Income tax department slams notice on five Mumbai-based exporters over offshore accounts
 Redress TDS mismatch grievance of taxpayers: CBDT

What is the actual post-tax return on different investments? Find out
August, 22nd 2016

The actual annualised returns of financial instruments vary from the quoted rates due to different methods of calculations involved and taxation rules. ET Wealth examines some popular investment options and works out the post-tax returns, assuming an investment of Rs 1 lakh in each product.

Investment options without 80C benefits
While bank FDs offer rates fixed periodically, future market situations will determine returns of debt and equity mutual funds.

1-year bank fixed deposits
Interest rate: 8.0%
Annualised return: 8.24%
Post-tax (30.9%) return: 5.7% (Rs 5,696)
Quarterly compounding ensures a higher annualised return than quoted rate.

Debt income fund
Historical returns: 9.07%
Annualised return: 9.07%
Post-tax (20% after indexation) return: 8.8% (Rs 8,796)
Based on 5-year category average return. Can vary significantly in future.

Diversified equity fund (large-cap)
Historical returns: 12.7%
Annualised return: 12.7%
Tax-free returns: 12.7% (Rs 12,700)
Based on 5-year category average return. Can vary significantly in future.

Returns get enhanced with added tax sops
Taxability of returns varies between 80C products. Though risk is higher, ELSS could generate better returns in the long-term.

Interest rate: 8.8%
Annualised return: 8.8%
Return 8.8% (Rs 8,800); 12.74% after 80C benefit
Interest rate may be revised downward in future.

Interest rate: 8.1%
Annualised return: 8.1%
Return: 8.1% (Rs 8,100); 11.72% after 80C benefit
Interest rate is for current quarter. It may be revised downwards in future.

Historical returns: 15.8%
Annualised return: 15.8%
Return: 15.8% (Rs 15,800); 22.87% after 80C benefit
Based on 5-year category average. Can vary significantly in future.

Retirement planning and insurance-based options
Compulsory annuity, taxable withdrawal at maturity and mixing investment & insurance make calculating returns complicated.

Historical returns: 11.62%
Annualised return: 11.62%
Return: 11.62% (Rs 11,620); 16.82% after 80C benefit
Based on 5-yr category average return. Calculations assume 50% investment is in equities and 25% each in corporate and govt debt.

Historical returns: 14.92%
Annualised return: 14.92%
Return: 14.92% (Rs 14,920); 21.59% after 80C benefit
15 year policy. Premium allocation charge of 20% for first year, 5% for each remaining years assumed. Admin charge Rs 500 and Rs 3,000 for insurance cost.

Historical returns: 3.27%
Annualised return: 3.27%
Return: 3.27% (Rs 3,270); 4.73% after 80C benefit
For 15 year policy with 4% annual bonus. Rs 3,000 considered as annual cost of insurance. Bonus rates of 3% and 4% may come down in future.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Privacy Policy

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions