{"id":6623,"date":"2015-12-04T08:53:20","date_gmt":"2015-12-04T03:23:20","guid":{"rendered":"http:\/\/www.apnaplan.com\/?p=6623"},"modified":"2015-12-04T09:53:54","modified_gmt":"2015-12-04T04:23:54","slug":"irfc-tax-free-bond-2015","status":"publish","type":"post","link":"https:\/\/www.apnaplan.com\/irfc-tax-free-bond-2015\/","title":{"rendered":"7.53% IRFC Tax Free Bond &#8211; December 2015 &#8211; Should You Invest?"},"content":{"rendered":"<figure id=\"attachment_6630\" aria-describedby=\"caption-attachment-6630\" style=\"width: 300px\" class=\"wp-caption alignright\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-6630\" src=\"http:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015-300x176.png\" alt=\"IRFC Tax Free Bond \u2013 December 2015\" width=\"300\" height=\"176\" title=\"\" srcset=\"https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015-300x176.png 300w, https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png 574w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><figcaption id=\"caption-attachment-6630\" class=\"wp-caption-text\"><strong>IRFC Tax Free Bond \u2013 December 2015<\/strong><\/figcaption><\/figure>\n<p style=\"text-align: justify;\"><b>IRFC (Indian Railway Finance Corporation)<\/b>, a Government of India company is issuing its <span style=\"text-decoration: underline;\"><strong>Tax Free Bond<\/strong><\/span>. It would offer coupon rate up to 7.53% for retail investors depending on tenure. You can choose between tenure of 10, 15 and 20 Years. The bond issue would be open for subscription for <strong>December 8 to 21, 2015<\/strong>.<\/p>\n<h2 style=\"text-align: justify;\">About IRFC:<\/h2>\n<p style=\"text-align: justify;\">IRFC, fully owned by the Government, finances the acquisition of rolling stock such as locomotives, coaches and wagons ordered by the Ministry of Railways (MoR). The MoR and its related entities are IRFC\u2019s sole clients.\u00a0It had zero non performing assets as of March 2015. The company posted a profit of Rs 758 crore during FY15.<\/p>\n<h2 style=\"text-align: justify;\">Salient Features: IRFC\u00a0Tax Free Bonds 2015<\/h2>\n<ul style=\"list-style-type: disc; text-align: justify;\">\n<li style=\"text-align: justify;\"><strong>Offer Period: December 8 to 21, 2015\u00a0<\/strong>(the offer can be pre-closed on full subscription)<\/li>\n<li style=\"text-align: justify;\"><strong>Annual Interest Rates for Retail Investors:<\/strong>\u00a07.32% for 10 Years,\u00a07.53% for 15 Years,\u00a07.50% for 20 Years<\/li>\n<li style=\"text-align: justify;\">The interest rates are 0.25% less for HNIs, QIBs and corporate subscribers.<\/li>\n<li style=\"text-align: justify;\">NRIs can invest in these bonds<\/li>\n<li style=\"text-align: justify;\"><strong>40% of issue is reserved for Retail Investors<\/strong><\/li>\n<li style=\"text-align: justify;\">Price of each bond: Rs 1,000<\/li>\n<li style=\"text-align: justify;\"><strong>Minimum Investment:<\/strong> 5 Bonds (Rs 5,000)<\/li>\n<li style=\"text-align: justify;\"><strong>Max Investment<\/strong> Limit for Retail Investor: Rs 10 Lakhs<\/li>\n<li style=\"text-align: justify;\"><strong>Date of first Interest Payment<\/strong>: First Interest Payment date is on October 15, 2016 and subsequently on October 15 of every year.<\/li>\n<li style=\"text-align: justify;\">Can be applied <strong>both in Physical and\u00a0Demat Form<\/strong><\/li>\n<li style=\"text-align: justify;\"><strong>Allotment:<\/strong> First Come First Serve<\/li>\n<li style=\"text-align: justify;\"><strong>Listing:<\/strong> Bonds would be listed on BSE and will entail capital gains tax on exit through secondary market<\/li>\n<li style=\"text-align: justify;\"><strong>Tax\/TDS:<\/strong> As these are tax Free Bonds so no tax is to be paid and there is no TDS on interest<\/li>\n<\/ul>\n<blockquote><p><strong>Also Read:<\/strong>\u00a0<a href=\"http:\/\/www.apnaplan.com\/ppf-2\/\">PPF &#8211; A Must Have Investment<\/a><\/p><\/blockquote>\n<h2 style=\"text-align: justify;\">IRFC\u00a0Tax Free Bond \u2013 Interest Rate:<\/h2>\n<p style=\"text-align: justify;\">The IRFC Tax Free Bond offers the following interest rates. The interest would be paid every year.<\/p>\n<p style=\"text-align: justify;\">The table also shows the effective interest rate for different tax slabs. <em>For e.g. To earn post tax 7.53% interest on deposit a person in 30% tax bracket should actually get pre tax return of 10.90%.<\/em><\/p>\n<figure id=\"attachment_6631\" aria-describedby=\"caption-attachment-6631\" style=\"width: 757px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-large wp-image-6631\" src=\"http:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bonds-\u2013-December-2015-Interest-Rate-1024x469.png\" alt=\"IRFC Tax Free Bonds \u2013 December 2015 - Interest Rate\" width=\"757\" height=\"347\" title=\"\" srcset=\"https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bonds-\u2013-December-2015-Interest-Rate-1024x469.png 1024w, https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bonds-\u2013-December-2015-Interest-Rate-300x137.png 300w, https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bonds-\u2013-December-2015-Interest-Rate.png 1172w\" sizes=\"(max-width: 757px) 100vw, 757px\" \/><figcaption id=\"caption-attachment-6631\" class=\"wp-caption-text\"><strong>IRFC Tax Free Bonds \u2013 December 2015 &#8211; Interest Rate<\/strong><\/figcaption><\/figure>\n<h2 style=\"text-align: justify;\">How Interest Rate on Tax Free Bonds Determined?<\/h2>\n<p style=\"text-align: justify;\">As per rules, the interest rate offered on Tax-free bonds are <strong>linked to yield on Government Bonds<\/strong>. Companies with AAA rated tax free bonds can offer <strong>up to 55 basis points lower to the G-Sec yield to retail investors and 80 basis points lower for other investors<\/strong>.<\/p>\n<h2 style=\"text-align: justify;\">Who should invest?<\/h2>\n<p style=\"text-align: justify;\"><strong>Tax Free Bonds are suited for people in the tax bracket of 20% or higher who are looking for regular and safe income.<\/strong> In case you do not want regular income you should first exhaust your Rs 1.5 lakhs <a href=\"http:\/\/www.apnaplan.com\/ppf-2\/\">PPF limit<\/a> where the returns are 8.7% and tax free. Salaried employees should opt for<a href=\"http:\/\/www.apnaplan.com\/voluntary-provident-fund-a-good-retirement-option\/\"> VPF <\/a>before looking at tax free bonds. Both the above options have higher returns, tax free and partial exit options after 5\/6 years.<\/p>\n<blockquote>\n<p style=\"text-align: justify;\"><strong>Also Read:<\/strong>\u00a0<a href=\"http:\/\/www.apnaplan.com\/max-income-tax-saving-fy2015\/\">What is the Maximum Income Tax You can Save for FY 2015-16?<\/a><\/p>\n<\/blockquote>\n<h2 style=\"text-align: justify;\">Why you should invest?<\/h2>\n<ol style=\"text-align: justify;\">\n<li style=\"text-align: justify;\"><strong>Almost \u201cNO\u201d credit risk.<\/strong> The bonds are rated \u201cAAA\u201d and the company is owned by Government of India. The bonds are secured to the full extent and have the highest credit rating (AAA).<\/li>\n<li style=\"text-align: justify;\">For retail investors, <strong>the interest offered is higher than the offers on Tax free bonds in Secondary\u00a0Market.<\/strong><\/li>\n<li style=\"text-align: justify;\"><strong>Good for investors in the tax bracket of 20% or higher<\/strong> looking for safe and regular income for long duration.<\/li>\n<li style=\"text-align: justify;\">There are chances of further rate cut by RBI. If it happens there <strong>would be capital appreciation<\/strong>\u00a0in the bond price.<\/li>\n<\/ol>\n<h2 style=\"text-align: justify;\">Why you should not invest?<\/h2>\n<ol style=\"text-align: justify;\">\n<li style=\"text-align: justify;\">PPF and EPF\/VPF offer tax free interest rate of more than 8.7%. So you should first exhaust those options especially if you are not looking for regular income.<\/li>\n<li style=\"text-align: justify;\">If you are in 10% tax bucket or pay no taxes, you would be better off with banks Fixed deposits or debt mutual funds.<\/li>\n<\/ol>\n<blockquote><p><strong>Also Read:<\/strong> <a href=\"http:\/\/www.apnaplan.com\/highest-interest-rate-on-recurring-deposits-rd\/\">Highest Interest Rate on Recurring Deposits [comparing 41 banks]<\/a><\/p><\/blockquote>\n<h2 style=\"text-align: justify;\">How to Apply?<\/h2>\n<p style=\"text-align: justify;\">The bonds can be issued both in physical and demat form. For applying through Demat Account, go to the IPO\/NCD\/Bonds offer tab of your Demat account and fill out relevant details.<\/p>\n<p style=\"text-align: justify;\">You can also download the Physical Form and follow the instructions.<\/p>\n<h2 style=\"text-align: justify;\">To Conclude:<\/h2>\n<p style=\"text-align: justify;\"><strong>IRFC\u00a0Tax Free Bonds 2015 suits investors who are looking for safe, regular income and are in the higher tax bracket.<\/strong> A few more PSUs are going to issue tax free bonds in coming days. The interest rate is expected to go marginally downward.<\/p>\n<p style=\"text-align: justify;\">NTPC\/PFC\/REC Tax Free Bond were over-subscribed multiple times on the first day itself, so <strong>if you want to subscribe these bonds, invest early as these would be grabbed very soon and may close for subscription<\/strong> if it gets fully subscribed before closure date.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>IRFC (Indian Railway Finance Corporation), a Government of India company is issuing its Tax Free Bond. It would offer coupon rate up to 7.53% for retail investors depending on tenure. You can choose between tenure of 10, 15 and 20 Years. The bond issue would be open for subscription for December 8 to 21, 2015. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":6630,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[31,30,340],"tags":[1876,1878,2894,2895,2877],"uagb_featured_image_src":{"full":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",574,337,false],"thumbnail":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015-150x150.png",150,150,true],"medium":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015-300x176.png",300,176,true],"medium_large":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",574,337,false],"large":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",574,337,false],"1536x1536":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",574,337,false],"2048x2048":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",574,337,false],"yarpp-thumbnail":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2015\/12\/IRFC-Tax-Free-Bond-\u2013-December-2015.png",120,70,false]},"uagb_author_info":{"display_name":"Amit","author_link":"https:\/\/www.apnaplan.com\/author\/admin\/"},"uagb_comment_info":0,"uagb_excerpt":"IRFC (Indian Railway Finance Corporation), a Government of India company is issuing its Tax Free Bond. It would offer coupon rate up to 7.53% for retail investors depending on tenure. You can choose between tenure of 10, 15 and 20 Years. The bond issue would be open for subscription for December 8 to 21, 2015.&hellip;","_links":{"self":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts\/6623"}],"collection":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/comments?post=6623"}],"version-history":[{"count":0,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts\/6623\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/media\/6630"}],"wp:attachment":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/media?parent=6623"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/categories?post=6623"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/tags?post=6623"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}