With interest rates falling, yields after tax have fallen dramatically. The post tax returns on investments have fallen in the last two years. There is now a need to look at great investment ideas, that offer tax free interest income in India. Take a look at 7 such investment ideas.
Sukanya Samriddhi Account
This scheme is a must if you have a girl child at home.
The interest income is tax exempt and you get tax benefits under Sec 80C of the income tax act for sums up to Rs 1.5 lakhs.
Interest rate at 8.7 per cent, makes this a superb deal.
SBI Life - Saral Maha Anand
The returns and the amounts earned on the SBI Life - Saral Maha Anand is tax free. This is because it is a unit linked insurance plan.
In this you pay a premium and on death you get 10 times of the premium paid. On the other hand the returns are tax free. So, you get duel benefits of tax free returns along with insurance.
Apart from this you get tax benefits under Sec 80C as well.
This has to be among the best tax free incomes. You get tax free interest income, apart from this an interest rate of 8.1 per cent. Not only is the interest income tax free, you also get tax benefits under Sec 80C of the Income Tax Act.
Today, you cannot get an interest rate of 8.1 per cent interest in any government bank in India.
REC Tax Free Bonds
REC Tax Free Bonds offer you an interest rate of 8.37 per cent. The bonds are traded on the NSE and the interest earned is tax free. If you buy the bonds now you get tax free interest payment on Dec 1. This is tax free in the hands of investors.
NHAI Tax Free Bonds
You can buy the tax free bonds listed on the BSE. The NHAI 2 series tax free bonds come at a price of Rs 1235.
The tax free bonds offer an interest rate of 8.3 per cent. The bonds can be purchased from NSE and you will receive tax free interest every year.
ICICI Prudential Wealth Builder II
Under this plan you get tax free income and also tax benefits under Sec 80C. You also get insurance up to 10 times the premium paid. So, if you pay a premium of Rs 50,000, you get an insurance of up to Rs 5 lakhs.
HDFC SL ProGrowth Flexi
Under this plan, you get insurance cover, as well as the amount is tax exempted. The income earned by way of returns is tax free.
You can get returns from investing in bluechip funds, balanced funds or opportunities fund. A good fund for tax free returns.