INSURANCE behemoth, Life Insurance Corporation of India, has pumped around Rs 26,000 crore into the equities markets (April 2009-October 2009), according to a senior company official. In comparison, overseas funds during the same period have bought Indian stock worth about $16 billion. The largest insurer in the country, has also increased its investments in nonconvertible debentures (NCDs) of many blue-chip companies and has invested a little over Rs 17,000 crore in the same period. NCDs are structured debt product that cannot be converted into equity shares of the issuing company but carry a high interest rate. The life insurer has also disbursed close to Rs 5,000 crore towards various infrastructure projects including power, roads, airport and education in the current financial year.
The NPS is a great way to save tax if you don't mind locking in your money till you retire. Till last year, the taxability of the NPS was a big issue. But last year's Budget changed the rules and made 40% of the corpus tax free. The PFRDA wants that the balance 60% to be exempt from tax as well. The emphasis is on increasing pension coverage. So, allowing EEE status (to NPS ) is our major demand (in the Budget NPS is especially useful for investors who may have exhausted the `1.5 lakh investment limit under Section 80C but want to save more. Another way the NPS can cut tax is by rejigging the salary.If a company deposits up to 10% of the basic salary of an employee in the NPS under Section 80CCD(2d), the amount will be tax free. Turn to page 28 to see how much tax this can save. However, the take-home pay of the employee will come down. Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 10 Tax...
