Net Yield 8.77%
SINGLE-PREMIUM insurance products are yet to hit the market. Very few plans are now on offer for investors. Bajaj Allianz Wealth Insurance is a singlepremium plan, which is a good investment among its peers due to its low-cost structure and high net yields. The plan is a type I insurance product having an exhaustive basket of funds for investment. However, based on past performance, the mid-cap fund is a lucrative investment considering that the fund generated a return of 193% in five years. The fund also offers loyalty additions on maturity. Being a singlepremium plan, the premium limit is a little on the higher side.
DDT is deducted when a non-equity fund declares dividends. Equity and balanced fund dividends are tax-free The AMC is correct to deduct the dividend distribution tax (DDT) as it is mandated by tax laws. DDT in mutual funds is deducted every time a non-equity fund declares dividends. Equity fund and balanced fund dividends are tax-free . It is possible that you have invested in a non-equity fund for the first time or have received the dividend under a non-equity fund for the first time. That is why this is the first occasion when you have come across DDT. The rate at which non-equity schemes deduct DDT has also gone up after the July 2014 budget. This is due to a change in calculation methodology. Earlier, if the fund has to declare a dividend of R 100, it used to make a provision for R 128.3, paying R 28.3 to the taxman and distributing the balance to the investor. This allowed the investor to bear less tax since the effective tax rate was 22.07 per ce...
