23rd March 2017 | VOL 11 | ISSUE 6 Fortnightly Issue        
Special Story

7 easy tips to save taxes that you didn’t know

In this article, we are going to talk about the following easy tax saving tips that you might not be aware of.

You can gift money to your major children
One of the best ways to save taxes is by gifting money to your major children.

Expert's View

How to save money effectively

In this article, we are going to look at the three most significant but forgotten rules of saving money effectively. These rules are actually common sense if we know them. However, most of us seem to have forgotten them and hence don’t practice them during our lifetime.

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Financial Planning

Investor Education: Step by Step Guide to Naive Investors

Deena Mehta
Mrs. Deena Mehta
Managing Director, ACMIIL

Lots of investors wish to participate in equity markets but do not know where to start from. Some have partial knowledge about the markets and there are others who are completely ignorant.

Equity SIP Model Portfolio
Conceptually, an Investment Advisory is a service that provides investment advice and designs a strategy to manage a certain sum of funds.
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Disclaimer: This InvestorFirst Magazine of Asit C. Mehta Investment Interrmediates Limited is meant to educate its recipients only. The news and views herein do not constitute investment advice or an offer to sell, or a solicitation of an offer to purchase or subscribe for any investment. The information herein is derived from sources believed to be reliable and is subject to change without notice.

7 easy tips to save taxes that you didn’t know




In this article, we are going to talk about the following easy tax saving tips that you might not be aware of.

You can gift money to your major children
One of the best ways to save taxes is by gifting money to your major children. For instance, let’s assume you have Rs. 20,00,000 that you want to invest in a bank FD. What you need to remember is that this will generate an annual income of approximately Rs. 1,60,000 at an interest rate of around 8% per annum. This amount will be added to your salary income and would be taxable. Now, here’s something interesting you can do to save taxes. Let’s assume that you have two major children. You can gift this Rs. 20 lakhs to them by either dividing it equally among them or give to one of them. In this case, the Income Tax authorities will not consider any income, which results from investing this amount as your income. Hence, it would be taxable at your end. Moreover, after adding interest income from FD, if your children’s income is below the minimum exemption limit, they will also not have to pay any tax.

If you are not comfortable gifting the money to your children, the other option you can think of is to provide an interest-free loan to them. Even in this case, if your children invest that money in FD, income generated will be considered their income and not yours. Therefore, you need not pay any taxes on that income. Please note that children must be major and you cannot gift money to your wife and avail this tax advantage. Thus, don’t stop investing by worrying about taxation from returns.

You can claim stamp duty and registration charges under section 80C
Generally, when you invest your money in a property, you will pay stamp duty and registration charges. The income tax authorities have given you the provision to claim that money under sec 80C. A lot of people are not aware of this and hence do not claim this. You can claim this money under 80C in the year you made the payment. For instance, if you bought a flat in 2016 and have paid Rs. 35,000 as stamp duty and registration charges you can claim this Rs. 35,000 under 80C. The only thing you need to remember here is that you can only claim this amount in the year of payment and your home should be under your possession since this is not allowed for under construction properties.

You can claim rent deduction even without HRA
If you are working in a company that does not provide you with HRA, you can still claim deduction under HRA. However, you need to know the following rules for claiming HRA in that scenario. The HRA you claim has rent paid after deducting 10% of your basic salary or Rs. 2000 per month or 25% of your income, whichever is the lowest. Please note that this is possible only if you are not getting HRA from your company or if you are a self-employed person. Many people are not aware of this so they do not claim HRA.

Make sure that you declare losses in your IT returns to save tax in the future
One of the best ways to save taxes is by setting off losses against your profits. Let’s assume you sold shares and incurred a loss of Rs. 2,50,000 in 2016. However, you also sold your real flat in 2016 and made a profit of Rs. 6,50,000. You can set off the loss of Rs. 2,50,000 against the profit of Rs. 6,50,000. Thus, your net taxable gain would be Rs. 4,00,000. Losses are classified into short-term and long-term capital loss.

Buy a property with your parents or siblings as the co-owners
You can have your parents or your siblings as the co-owner while buying a home. Therefore, not only you but your parents and/or siblings can claim tax benefits. Many people have a common perception that only a spouse can be a co-owner to claim income tax benefits.

Make use of education loan to lower taxes for you children in the future
Interest paid on education loan taken for your children’s higher education is allowed as a tax deduction. Therefore, even if you have the cash ready for your children’s education. It would be advisable for you to invest that elsewhere for better returns and go in for an education loan instead. You save taxes every year this way.

You can claim unlimited deductions for interest payment of your second home loan
In case you are planning to buy your second home, you can claim all the interest payments as deductions since there is no upper limit in this regard. Please note that it should be your second home.

How to save money effectively



In this article, we are going to look at the three most significant but forgotten rules of saving money effectively. These rules are actually common sense if we know them. However, most of us seem to have forgotten them and hence don’t practice them during our lifetime.

You can be rest assured that once you know and follow these rules for saving money, you will end up saving a good corpus. Let’s get started with the rules:

Rule 1: Do you know your purpose of saving money?
Why you should save money? It’s a valid question, isn’t it? Most professional financial planners will tell you that the main objectives of savings are to prepare for your future and for other contingencies. It’s good to be prepared for future and cover for emergencies. That said, you must remember that saving money is ‘not all about money’. In fact, saving money is about forgoing the ordinary for the extraordinary. It’s simple, you’ll have to clearly differentiate between your needs and wants. If you start forgoing or limiting some of the ordinary wants such as glittering night-outs, movies, and other such wants early in your life, you can be rest assured that these savings will help you prepare for your dream vacation or your favourite car in the future. Isn’t that extraordinary?

You must decide what’s more important for you, a fancy mobile, sports shoes, awesome clothes, or buying your engagement ring or a dream honeymoon with your own savings. You must follow the golden rule ‘to win many, you must lose some’. Here, you don’t even have to lose, but just have to subtly tweak your lifestyle for ensuring more savings and a better future.

That’s why savings is not about money. It’s about forgoing the ordinary things, which don’t have any major contribution in your life, for those extraordinary moments, which will not come again such as a dream honeymoon or an engagement ring or down payment for your dream home. Just imagine the self-confidence you’ll experience through saving this way and achieving your extraordinary dreams. Thus, never feel bad or pity yourself when you’re saving money. Remember, that you are forgoing the good things today for the greater things or the better things tomorrow. Now, that’s what you call saving money.

Therefore, even before you start saving money you must start thinking about your purpose of saving money. You must define what your extraordinary experiences in the future are for which you would love to save money starting today. Remember these extraordinary things will give you the following:

•   Financial stability
•   Security for future
•   Foreign vacations
•   Higher education in top universities for your children
•   Most importantly, the peace of mind and the feeling of accomplishment

Always keep thinking about your extraordinary goals, it will keep you highly motivated while saying no to ordinary things, which will help you have an extraordinary life.

Rule 2: Segmentation of your money
One of the key things you must ensure is the bank account where you’re saving your money must be different from the one where you spend the money. This way, you keep the savings process simple. The account where you save your money would be just dedicated to your savings. Thus, having a separate account for expenses ensures that you don’t confuse your savings with your expenses. This is basic, but is not followed by many. Do it, you will benefit.

Rule 3: Please note that every Rupee you earn counts
If you want to save Rs. 5 crore at retirement, you need to remember that every Re.1/- adds to your retirement corpus. Therefore, remember that if you can save Re.1/-, you can save any amount. Moreover, mutual fund SIPs allow you to start investing from Rs.500 per month. The key point that you need to remember is that when you saving Re.1/-, Rs.100, Rs.1000, Rs. 1 lakh, or Rs. 1 crore, the process is the same. Thus, every Rupee matters.
Happy Investing!

Investor Education: Step by Step Guide to Naive Investors

Deena Mehta
 
Mrs. Deena Mehta
Managing Director, ACMIIL
 
Lots of investors wish to participate in equity markets but do not know where to start from. Some have partial knowledge about the markets and there are others who are completely ignorant. There are others who take great pride in saying I do not invest in stock market. As I have written in the first & second issues of market wisdom, the Indian saver cannot ignore equity investments; falling interest rates and withdrawal of tax concessions on income generated out of government and bank savings coupled with rising inflation has necessitated participation in equity markets. Equity investments have a potential of generating highest revenue compared to other financial investment options. Knowledge of course is the first requisite.

There are several ways of getting introduced to the stock market, I would recommend the way which is the safest

• To begin with reading about the markets is the first requirement.

• Start reading the share market page in the newspapers. There is a summary on the stock prices' page of what happened during the day that gives you a fair idea of the market activity.

• Business channels on the television also make you familiar about the markets. If you are working during the day, then watch the market report, which is broadcast by most channels in the evening.

• There are also websites like www.moneycontrol.com specifically dedicated to markets providing regular updates.

• Initially it may sound very boring. It can be made interesting if you focus on 2-3 stocks only. Just pick names that are familiar to you such as Reliance, Infosys, etc. You may also be working for a company or bank or supplying to any company, then select such names. Housewives identify the stocks by reading the labels displaying the manufacturing company name on the packaged product they buy. Students can look at the company stocks that they have done research projects in. In short there are enough company names available around us. Maintain a journal or a diary and write down these company names. To make it more interesting, predict the stock price for the next day, whether it will go up or down and why. Spend 15 minutes daily and write down whether your predictions were right or wrong and why.

If you do this for 6 months on a continuous basis then you would have sufficient knowledge to experiment with the market.

Do not commit any money at this stage. Assume that you have Rs.1 lac and note it in your diary as capital. Make buy decisions with this money in the 2-3 stocks that you have been studying. Make a note of it in the diary by looking at the closing prices take buy-sell decisions. Each time you make or lose money, write down why it happened. Several analysis of leading company stocks is available on business channels, web sites and business news papers. Plus you will also read news items. Another important source of information is website www.bseindia.com / www.nseindia.com. These are the official web sites of Bombay Stock Exchange - BSE Ltd and National Stock Exchange. which captures results and news about companies. During this period there has to be intensive self-learning. Try to analyze why your decision was correct or otherwise. In a rising market you will be very successful often, that does not mean you are a great stock picker. Learning will happen only if you analyze the reasons for rise or fall in prices. Doing this on a regular basis for 3 months equips you to start committing money.

In order to start trading on the exchange, three accounts are necessary

1. Trading account with a broker,

2. Beneficial Owner account with a Depository Participant and

3. Bank account.

Most of you would have a bank account. However, for online trading, a Bank with either online banking or core banking facilities is necessary for hassle-free trading. Hence if your bank does not offer such services then a new account would be essential. Most online brokers have tie-ups with Banks for online transfers, once you select a broker then look up for the banks which have links with the broking site, open account with such a bank. I have already written about Broker selection in Market Wisdom, which should be referred to in order to select the right broker.

The account opening form of the broker has four components - The Know-Your-Client (KYC) form, separate agreements for trading on BSE and NSE, Risk Disclosure Document and certain Power of Attorneys. Ensure that you read the Power of Attorney carefully and give authority only for delivering shares to exchange on your behalf against your sale trades and not for any thing else. The KYC form captures your contact details and your financial worth. This Form is also accompanied with Proof of your identity, proof of your residence and Permanent Account Number (PAN) card. Proof of identity can be given by submitting a copy of your Passport, Voters card etc. You need to get your photograph attested by your banker. Proof of address is ration card, latest electricity bill etc. All documents should be produced in original for verification.

Make sure you read the risk disclosure document before signing and submitting to the broker. This document will explain the different risk involved with your transaction for which you will be responsible. There is an inherent risk of price variation (volatility) of the securities you have dealt in, risk due to low liquidity in a particular company, risk due to more than normal difference between a person wanting to buy and another wanting to sell. The document also explains certain risk mitigation measures that can be used by you.

On submitting the completed set of document, the broker will scrutinize and if found everything in order will allot a code normally referred to as client code to you. You may need to furnish this code every time you want to transact. Having got your client code you can start transacting in the stock market. However you need to ensure that you have paid the requisite margin money as stipulated by your broker to place any transaction. Initially you start with placing orders in small quantity between 1 to 10 shares. Once you have understood the system in full you may gradually increase the size of your transaction.

Equity SIP Model Portfolio

Conceptually, an Investment Advisory is a service that provides investment advice and designs a strategy to manage a certain sum of funds. Here, we have provided an investment strategy in the form of Equity SIP model portfolios. With the basic understanding that investors can be broadly classified as high, medium and low risk takers, we designed Aggressive, Moderate and Defensive Portfolios respectively, as on January 2013. Each portfolio basket requires an investment of aproximately Rs.10,000 per month and is a good way of accumulating fundamentally sound stocks for a long term horizon. These portfolios will be reviewed half yearly and any changes will be communicated accordingly.


Benchmark Return From






Nifty 18.70% 12/31/2012






NIFTY 100 21.80% 12/31/2012





Aggressive Portfolio
Sr. N Scrip Name Sector Weight Basket Qty Price as on 28 Feb. 2017 Total Value Portfolio Beta Return
% Return Wt Return
1 Tata Motors Ltd Automobile 10.69% 2 456.75 913.5 0.18 0.15% 0.03%
2 ICICI Bank Banking 9.23% 3 276.35 829.05 0.23 11.05% 2.58%
3 LIC Housing Finance Ltd NBFC 5.93% 2 560.8 1121.6 0.11 61.29% 6.55%
4 VEDL Diversified 2.34% 4 259.1 1036.4 0.03 65.51% 2.22%
5 State Bank of India Banking 1.35% 3 269.2 807.6 0.10 15.02% 1.56%
6 ONGC Ltd Oil & Gas 4.65% 3 193.55 580.65 0.06 -32.56% -1.98%
7 Aditya Birla Nuvo Ltd Diversified 11.83% 2 1441.95 2883.9 0.12 66.30% 7.84%
8 Adani Ports Port & Logistics 2.80% 3 301.75 905.25 0.03 14.97% 0.48%
9 BHEL Capital Goods 1.93% 4 162.45 649.8 0.02 2.52% 0.05%
10 Tata Steel Ltd Metals & Mining 5.61% 2 482.7 965.4 0.10 37.46% 3.88%
11 Sun Pharmaceuticals Inds. Ltd Pharmaceuticals 9.52% 1 679 679 0.12 1.82% 0.23%
EXIT Return from Exited Stocks






18.91%

Total
100.00%

11372.15 1.30
43.85%











Benchmark Return From






NIFTY 200 23.60% 16-Dec-13





Moderate Portfolio
Sr. No. Scrip Name Sector Weight Basket Qty Price as on 28 Feb. 2017 Total Value Portfolio Beta Return
% Return Wt. Return
1 HDFC Bank Banking 30.12% 1 1390.1 1390.1 0.25 51.46% 13.09%
2 M&M Financial Services Ltd NBFC 4.62% 2 291.65 583.3 0.06 7.10% 0.40%
3 VEDL Diversified 2.35% 5 259.1 1295.5 0.05 59.76% 2.73%
4 Ambuja Cement Ltd Cement 3.80% 3 229.35 688.05 0.04 23.57% 0.90%
5 ITC Ltd FMCG 6.50% 2 262.2 524.4 0.07 -17.58% -1.16%
6 Infosys Ltd IT services 1.99% 1 1012.4 1012.4 0.02 -6.42% -0.11%
7 Zee Entertainment Ent. Ltd Media 6.39% 2 509.45 1018.9 0.07 50.06% 3.30%
8 Hindalco Inds. Ltd Metals & Mining 3.01% 3 184.35 553.05 0.05 50.49% 2.38%
9 Reliance Inds. Ltd Oil & Gas 9.50% 1 1238.05 1238.05 0.09 33.29% 2.87%
10 Biocon Ltd Pharmaceuticals 9.31% 2 1122.45 2244.9 0.07 126.89% 8.81%
11 Bharti Airtel Ltd Telecom 7.94% 2 365.15 730.3 0.06 9.96% 0.62%
EXIT Return from Exited Stocks






22.08%

Total
100.00%

11278.95 0.79
57.42%











Benchmark Return From






NIFTY 200 23.60% 12/16/2013





Defensive Portfolio
Sr. No. Scrip Name Sector Weight Basket Qty Price as on 28 Feb. 2017 Total Value Portfolio Beta Return
% Return Wt. Return
1 Glenmark Pharma Pharmaceuticals 3.39% 1 925.5 925.5 0.03 3.58% 0.11%
2 HDFC Bank Banking 9.12% 1 1390.1 1390.1 0.08 51.49% 3.97%
3 Cummins India Ltd Capital Goods 6.58% 1 887.9 887.9 0.05 22.04% 1.18%
4 Dabur India Ltd FMCG 5.84% 2 276.9 553.8 0.04 26.82% 1.18%
5 Tech Mahindra IT services 2.34% 1 499.4 499.4 0.02 -7.47% -0.17%
6 TCS Ltd IT services 20.41% 1 2466.25 2466.25 0.17 9.20% 1.57%
7 Hind. Unilever FMCG 3.25% 1 865.9 865.9 0.02 1.09% 0.03%
8 Coal India Mining 1.01% 2 321.9 643.8 0.01 3.29% 0.03%
9 Lupin Ltd Pharmaceuticals 11.96% 1 1474.1 1474.1 0.10 11.37% 1.17%
10 Pidilite Ind Specialty Chemicals 1.11% 1 682.15 682.15 0.01 0.06% 0.00%
EXIT Return from Exited Stocks






28.48%

Total
100.00%

10388.9 0.60
39.05%











Benchmark Return From






NIFTY Midcap 30.10% 12/16/2013





Mid Cap Portfolio
Sr. No. Scrip Name Sector Weight Basket Qty Price as on 28 Feb. 2017 Total Value Portfolio Beta Return
% Return Wt. Return
1 Motherson Sumi Systems Ltd Auto Ancillaries 7.99% 3 350.2 1050.6 0.13 104.35% 13.17%
2 Kalpataru Power Power Transmission 4.06% 3 286.5 859.5 0.04 17.81% 0.63%
3 Va Tech Wabag Ltd Capital Goods 17.38% 2 574.6 1149.2 0.13 19.97% 2.53%
4 PFS NBFC 2.63% 15 41.35 620.25 0.03 4.20% 0.12%
5 Gateway Distriparks Logistic 4.63% 2 246.65 493.3 0.04 -21.05% -0.75%
6 Aia Engineering Ltd Capital Goods 9.15% 1 1480.95 1480.95 0.03 41.47% 1.06%
7 Apollo Tyre Auto Ancillaries 3.30% 4 187.6 750.4 0.04 6.87% 0.26%
8 Camlin Fine Chemical 1.43% 6 94.2 565.2 0.01 -5.68% -0.08%
9 JK Cement Ltd Cement 6.64% 1 886 886 0.07 69.72% 4.68%
10 DHFL NBFC 4.97% 4 333.15 1332.6 0.09 38.59% 3.42%
11 Majesco Ltd* IT 4.88% 2 344.15 688.3 0.08 -13.99% -1.16%
12 Return from Exited Stocks






14.85%

Total
100.00%

9876.3 0.96
40.22%

 

 

About Us

Company History & Background
Established in the year 1986, Asit C. Mehta Investment Interrmediates Ltd. (ACMIIL) is one of the most trusted and reputed brokerage houses known for providing investment related services in the capital market, money market and depository services in India. The company has been jointly promoted by noted stock market professionals, Mr. Asit C. Mehta and Mrs. Deena A. Mehta and is a part of Mumbai-based Nucleus Group of Companies. The other group companies are engaged in commodity, derivatives, development of databases, back-office applications for banks, corporate document management solutions and Geographical Information Systems (GIS).
Corporate Purpose
Envisioned to be a "Trusted Financial Intermediary", the group has etched out a very specific corporate purpose - "To reach appropriate financial products, services and solutions to every Indian entity."
Our Beliefs

  • That every household can, should and will need to participate in the financial markets directly or indirectly to protect their financial interests.
  • That regulatory/legal compliance ensures economic sustainability.
  • That transparency and fairness are the cornerstones of all dealings.
  • That knowledge rather than capital is the key driver of this business.
  • That product, process and technology led innovations are necessary preconditions for continuously adding value to all our constituents.
  • That given the environment every person will realize her/ his potential.
  • That people are driven by causes.
The FIRSTS to our Credit
  • One of the First limited liability Companies to acquire membership on Bombay Stock Exchange (BSE).
  • One of the First multiple seat holders and multiple exchange members.
  • One of the First private VSAT network users.
  • First to utilize the franchisee business model for Associates.
  • First to achieve the ISO quality certification for business processes from SGS. Currently we are a "ISO 9001:2008" certified company.
  • Company Managing Director Mrs. Deena A. Mehta was the first woman to be elected to the governing board of the BSE and the first and only woman to be the President of BSE (post corporatization).

Contact Us

Asit C Mehta Investment Interrmediates Ltd.
Nucleus House, Saki-Vihar Road,
Andheri (E), Mumbai 400 072.
Maharashtra. India.
Telephone : 91-22-28583333,66798315,28577898
Fax : 91-22-28577647
Email : helpdesk@acm.co.in
For corporate level general communication, you need to email at acmiil@acm.co.in
Toll Free Number