Fixed Deposits are one of the oldest and most common
methods of investing. When it comes to assured
returns, choosing the right type of savings scheme
makes all the difference. Fixed Deposits let you
make the most of value-added benefits as you create
wealth at low risk.
Fixed Deposits in companies that earn a fixed rate
of return over a period of time are called Company
Fixed Deposits.
Corporate Deposits are loan arrangements
where a specific amount of funds is placed on
deposit under the name of the account holder. The
money placed on deposit earns a fixed rate of
interest, according to the terms and conditions
that govern the account. The actual amount of the
fixed rate can be influenced by such factors at
the type of currency involved in the deposit, the
duration set in place for the deposit, and the
location where the deposit is made.
Types of Companies
offering Fixed Deposits
Financial
Institutions
Non-Banking Finance
Companies (NBFCs).
Manufacturing
Companies
Housing Finance
Companies
Government Companies
&
You can also go for
Fixed Deposits with Banks.
Benefits of investing in Company Fixed
Deposits
- High interest.
- Short-term deposits.
- Lock-in period is only 6 months.
-
No Income Tax is deducted at source if the
interest income is up to Rs 5,000 in one
financial year
-
Investment can be spread in more than one
company, so that interest from one company does
not exceed Rs. 5,000
54 EC BONDS
Capital Gain be saved Under Sec 54EC or Sec 54F, if
the land or property sold is non agriculture. We
deal in such bonds which qualify for Sec 54EC Bonds.
Tax can be
saved under Section 54 EC by investing in bonds
Tax can be
saved under Section 54 F by investment in New
residential house
Not deducting
any Tax at Source ( NO TDS)
To claim Section 54 EC following conditions is to
be satisfied.
Long Term Capital Asset Long term assets
means any capital asset held by assessee for more
than 3 Years.
If assesee has sold the Long term capital
asset during the previous year and made a long term
capital gain then he can invest money of capital
gain in Capital gain bonds and can save tax on long
term capital gain.
Assessee here means all type of
assessees,like individual,firm company etc.
Amount to be invested in bonds is only
capital gain not net consideration received on sale
of long term capital asset
Amount exempted under this section will be
amount of capital gain or amount invested in capital
gain bond which ever is lower maximum up to
50Lakh(see note below)
These Bonds Maturity Period is Three
years
Capital gain bonds eligible under this
section are now can be issued only by REC or
NABARD
Bonds can not be pledged ,sold transfer
before completion of three year from purchase of
bonds ,and in case its transferred then amount
capital gain exempted on investment in these bonds
will be made taxable in that previous year as Long
term capital gain .
Amount of capital gain should be invested in
Capital gain bond within 6 Month from date of
transfer/sale of capital asset .
|
BONDS
|
|
Bonds
|
Interest Rate%
|
Int Frequency
|
Term
|
Min Amt Rs
|
|
REC-54EC
|
6.00%
|
Annually
|
3 Yrs
|
10000
|
|
NHAI-54EC
|
6.00%
|
Annually
|
3 Yrs
|
10000
|
|
8% TAXABLE BONDS
|
|
ICICI, HDFC, UTI & SBI
|
8.00%
|
Half Yearly/Cum
|
6 yrs
|
10000
|
DEBENTURE
A type of debt instrument that is not -secured by
physical asset or collateral. Debentures are backed
only by the general creditworthiness and reputation
of the issuer. Both corporations and governments
frequently issue this type of bond in order to
secure capital. Like other types of bonds,
debentures are documented in an indenture.
Debentures have no collateral. Bond buyers generally
purchase debentures based on the belief that the
bond issuer is unlikely to default on the repayment.
An example of a government debenture would be any
government-issued Treasury bond (T-bond) or Treasury
bill (T-bill). T-bonds and T-bills are generally
considered risk free because governments, at worst,
can print off more money or raise taxes to pay these
type of debts
A debenture is a document that either creates a debt
or acknowledges it, and it is a debt without
collateral. In corporate finance, the term is used
for a medium- to long-term debt instrument used by
large companies to borrow money. In some countries
the term is used interchangeably with bond, loan
stock or note.
A debenture is thus like a certificate of loan or a
loan bond evidencing the fact that the company is
liable to pay a specified amount with interest and
although the money raised by the debentures becomes
a part of the company's capital structure, it does
not become share capital. Senior debentures get paid
before subordinate debentures, and there are varying
rates of risk and payoff for these categories.
There are two types of debentures:
-
Convertible debentures, which are convertible bonds or bonds that can
be converted into equity shares of the issuing
company after a predetermined period of time.
"Convertibility" is a feature that
corporations may add to the bonds they issue to
make them more attractive to buyers. In other
words, it is a special feature that a corporate
bond may carry. As a result of the advantage a
buyer gets from the ability to convert,
convertible bonds typically have lower interest
rates than non-convertible corporate bonds.
-
Non-convertible debentures, which are simply regular debentures, cannot be
converted into equity shares of the liable
company. They are debentures without the
convertibility feature attached to them. As a
result, they usually carry higher interest rates
than their convertible counterparts.
