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Tax Savings Investments

 

Tax Savings Options Available With SIB

SNO
PRODUCTS
TAX RELAXATIONS
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Section 80C of IT Act
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Section 80C of IT Act
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Section 80C of IT Act
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Section 80D of IT Act
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Section 80CCG of IT Act
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Section 80CCD of IT Act
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Section 80C of IT Act
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Section 54EC of IT Act

Other Tax related services

TAX PAYMENT FACILITY (Click to know more) 
PAN Service Agency (PSA) (Click to know more)                                                                        Online E-Filing Facility (Click to know more)
 

SIB Tax Gain Deposit:

The salient features of the scheme are given below:

An investment up to Rs.1 lac (Minimum Rs.100/- and maximum Rs.1 lac in multiples of Rs.100/-) deposited in the bank as Fixed / under Compound interest scheme for a period of 5 years under SIB Tax Gain Deposit is eligible to be treated as exemption from Income Tax under Section 80C of IT Act, 1961.

• Amount deposited in the name of individual, joint (first name holder) or HUF (Karta) not exceeding Rs.1 lac in a financial year is eligible for tax exemption.

• Though nomination can be registered, NO nomination shall be made in respect of a term deposit applied for and held by or on behalf of a minor.

• The rate of interest will be the rate of interest applicable for Fixed deposits with maturity 5 years. Additional rate for senior citizens will be applicable to this deposit also.

• Deposit can be transferred from branch to branch but not between banks.

• This deposit shall not be encashed before the expiry of 5 years from the date of its receipt.

• Interest on this deposit shall be liable to Income Tax on the basis of annual accrual or receipt depending up on the simple interest or compound interest scheme and tax on such interest shall be deducted as usual.

• The deposit shall not be pledged to secure loan or as security mentioned as per the Term deposit scheme, 2006, issued by the Central Government of India.

Interest Rate:

DEPOSIT SCHEME
GENERAL
SENIOR CITIZEN
NRO
SIB-TAX GAIN DEPOSIT
8.75%
9.25%
8.75%

Yield: 10.83% on compounding (General) Yield: 11.59% on Compounding (Senior Citizen)

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Mutual Fund:

One of the preferred investment options for all those who want to play safe, yet save more than what traditional saving avenues offer! South Indian Bank has tied-up with the leading Mutual Funds, so that you may pick and choose, as per your investment goals.

Tax Benefits:

Investments in ELSS (Equity Linked Savings Scheme) upto Rs.1 lakh are eligible for tax exemption as per Sec.80C. Long term capital gains are exempted subject to the Ensure that the listed Funds are formed in accordance with the provisions of Section 10(23D) of the Income-tax Act, 1961 Dividends from equity funds are tax free. Tax saving funds of the following Mutual Fund companies are available at SIB branches.  

  • LIC Nomura Mutual Fund
  • ICICI Prudential AMC 
  • Franklin Templeton 
  • TATA Mutual Fund 
  • Sundaram Mutual Funds 
  • UTI Mutual Funds 
  • Reliance Mutual Funds 
  • HSBC Investments 
  • HDFC Mutual Fund 
  • L & T Investment Management Limited. 
  • Principal Mutual Funds 
  •  Birla Sun Life Asset Management Company Ltd. 
  •  DSP BlackRock Mutual Funds

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Life Insurance tie-up with LIC

South Indian Bank Ltd. has entered into a tie up with the Giant in the Life Insurance Sector - LIC of India for soliciting Life Insurance policies for our customers. LIC is the only insurance company whose policy proceeds are guaranteed by the Government. Through this tie up, the banking expertise of South Indian Bank Ltd. and the risk management expertise of LIC of India will be combined to provide excellent life cover policies and investment option to our customers. An Life Insurance Policy can be taken for Individuals- self spouse and children and HUF- any family members. All the products of LIC will now be available through our branches. It opens up a reliable and trustworthy investment avenue, making SIB a one stop shop for all financial requirement.

Tax Relief:

Life Insurance is the best way to enjoy tax deductions on income tax. This is available for amounts paid by way of premium for life insurance subject to income tax rates in force. Under section80C the maximum tax deduction that can be gained for premium paid is Rs. 1,00,000/- in a financial year. Any amount received under a Life Insurance Policy including the sum allocated as bonus is exempted under section 10(10D) of the income tax act, 1961 subject to certain exclusions under the section. 

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Health Insurance Policies

Arrangement with Bajaj Allianz GIC (Exclusive products for SIB Customers)

Hospitalization expenses / medical treatment have now increased considerably. Once you are sick and hospitalized, then you have no other choice, but to avail the best health services, spending your hard earned savings. Realizing this eventuality, we now offer an excellent health insurance product from M/s. Bajaj Allianz General Insurance Company. This product is available to our SB / CD customers, including NRIs (for expenses incurred in hospitals in India) exclusively through the South Indian Bank branches.

Deduction in respect of Medical Insurance premium (Section 80 D.)

Deduction up to a maximum of Rs.15,000/- is allowed in respect of any sum paid to effect or to keep in force insurance on the health of the Assessee or spouse or dependent children. An additional deduction of up to Rs.15000/- will be allowed to an individual assessee on any payment made to effect or keep in force an insurance on the health of his parent or parents whether dependent upon him or not. Additional deduction of Rs.5,000/- will be available in case any of the insured is a senior citizen and such premium is in respect of keeping in force the insurance of that person. Income tax benefit on the premium paid is as per section 80-D of the Income Tax Act, which will be over and above the normal Sec 80C limits.

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Rajiv Gandhi Equity Savings Scheme

Deduction in respect of Rajiv Gandhi Equity Savings Scheme (RGESS) (Sec 80CCG)

Finance bill 2012 inserted a new investment scheme under section 80CCG with effect from AY 2013-14. This scheme is called Rajiv Gandhi Equity Savings Scheme. This Scheme shall apply for claiming deduction in the computation of total income of the assessment year relevant to a previous year on account of investment in eligible securities under sub-section (1) of section 80CCG of the Income-tax Act, 1961. Annual income limit is Rs 12 lakhs from AY 14-15

FAQ on Rajiv Gandhi Equity Savings Scheme

1) What is Rajiv Gandhi Equity Savings Scheme and how does it offer tax benefits?

With an objective to encourage flow of savings of the small investors in domestic capital market, the Government of India announced a scheme named Rajiv Gandhi Equity Savings Scheme. Tax benefit is given to a ‘New Retail Investor’ who invest up to Rs 50,000 in ‘Eligible Securities’ and have gross total annual income less than or equal to Rs.10 Lakhs

2) How much tax deduction is available for a new retail investor under RGESS?

• A new retail investor can invest any amount up to Rs 50,000/- in eligible securities for availing tax benefits in RGESS. The amount eligible for tax deduction from the income will be Rs 25,000/- or 50% of the amount invested. One can invest in eligible securities above the limit of Rs 50,000/-, but the benefit under the scheme can be claimed only on investment up to Rs. 50,000/-

3) How does one invest in eligible securities of RGESS?

• Firstly, he/she need to have a Demat account. The Demat account must be designated as RGESS.
• For investing in any eligible securities from the secondary market, one can approach any SEBI registered stock broker.
• In case anyone is investing in mutual funds through any distributor, he/she need to simply provide your Demat account details like Demat Account Number and DP ID for receiving credit of the mutual fund units into the Demat account.
• For investing in any IPO/NFO of the eligible securities, he/she can subscribe for the same and provide your Demat account number for receiving credit of the eligible securities into the Demat account.

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NPS (National Pension Scheme)

Pension Fund Regulatory and Development Authority (PFRDA) have been established by the Government of India, Ministry of Finance to promote old age income security. The Government authorized PFRDA to extend NPS on a voluntary basis to all citizens of India including workers of the unorganized sector.NPS is now available to all citizens of India with effect from May 1, 2009, other than Government employees already covered under NPS. The South Indian bank is acting as a Point of Presence- Service Provider (POP-SP) for servicing NPS Accounts.

Benefits of Joining NPS

• Its Voluntary: NPS is open to every Indian Citizen, Including NRI’s.
• Its Flexible: One can choose his own Investment option & Pension Fund Manager.
• Its Portable: One can operate the account from anywhere in the Country, even if you change your city, job or pension fund manager.
• Its Regulated: NPS is regulated by PFRDA, with transparent investment norms, & regulated Monitoring & Performance review of Fund Managers by NPS trust.

NPS Offers tax exemption upto Rs. 1lac for investment under 80CCD

On attaining the Normal Retirement Age (NRA) of 60 years

• Customer is required to compulsorily annuitize minimum 40% of accumulated pension wealth.
• Remaining 60% can be withdrawn as a lump sum or in a phased manner; within the age of 70.

NOTE

• Limit is 80C+80CCC+ 80CCD(1) cannot exceed Rs 1,00,000 [80CCD(1) means contribution by an employee or others towards NPS)
• Limit for employer contribution 80CCD(2)- Employer contribution excess of 10% of the salary shall is not considered for deduction
• Limit for employees contribution under 80CCD(1)- for employees contribution in excess of 10% of the salary is not considered for deduction and for others the limit is 10% of GTI(Gross total income.


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SIB- HOME LOAN

Own your Dream HOME through SIB HOME Loans Now !!!!! for interest as low as 10.5%!!!!

• Loans Available for Ready built Houses/Flats or for constructing your dream HOME.
• Identify the Property, Approach nearest branch. Rest we will take care.

Income Tax benefits for interest up to Rs 1.50 lakhs
Income Tax Rebate up to Rs 1,00,000 under 80C for principal repaid

Salient Features

• Simple Documentation procedures
• No prepayment Penalty *
• Flexible repayment options
• Repayment facility up to 20 years or more*
• Special Schemes for NRIs
• Income Tax benefits for interest up to Rs 1.50 lakhs
• Income Tax Rebate up to Rs 100000 under 80C for principal repaid
• Online repayment facility from other bank accounts.
• Low Processing Fees
• No Hidden Charges
• Flexible & Fixed Interest options *
• Repayment holiday for house construction loans
• Life Insurance of borrower can be opted to cover unforeseen happenings

Additional loans for extension/repairs:
Documents Required:

Identity, Address & income proof of borrower & Guarantor 
Property title deeds 
Encumbrance Certificate& Tax paid Receipt
Agreement for sale from seller 
Approval from local body & Estimate of the project
 

CAPITAL GAIN BONDS

(For getting Capital Gain Tax Exemption)

If the investor sells a property i.e. house or real estate, after three years time period the profit earned attracts long term capital gains tax at a rate of 20%(after indexation). The assessee can choose to get exemption from this long term capital gain tax in 2 ways:

• Either by investing the amount in buying or constructing a new house property within 2/3 years of selling the house

OR

• Investing in Capital Gain Bonds.

Features:

• Covers “Capital gain arises from the transfer of a long-term capital asset.
• Bonds covering the benefits under Section 54EC of the Income Tax Act.
• Section 54EC exempts tax on capital gains if the profit earned by selling the property (the property should have been owned by the investor at least for a period of 3 years termed as long term capital) is invested in specified bonds within six months from the date of sale.
• Lock-in-period is 36 months.
• Guaranteed rate of interest of 6 %.
• The face value of these bonds is Rs 10,000/-
• The maximum amount that can be invested in these types of bonds is Rs 50, 00,000/- during the financial year.
• Time limit for investment- within 6 months from date of transfer.
• Exemption – Lower of the amount of capital gains or amount invested.
• Bonds of NHAI(National Highway Authority of India) or REC(Rural Electrification corporation Ltd are currently available.

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