Frequently Asked Questions on Rajiv Gandhi Equity Savings Scheme
Update (Budget 2013-14) :
1. It is proposed to increase income limit of eligible investors form existing 10 Lacks to 12 Lacks
2. Investors can claim tax exemption for three continuous years.
Frequently Asked Questions on Rajiv Gandhi Equity Savings Scheme
a) Is Any NFO available as on date ( 02 Feb 2013)?
DSP BlackRock RGESS* Fund – Series 1 is a 3 year close ended large cap equity fund that would invest in RGESS eligible securities. Units of DSPBRRGESSF have been recognised as eligible securities for investors seeking tax benefits under RGESS.
NFO Period of DSP BlackRock Rajiv Gandhi Equity Savings Scheme:
Feb 14, 2013 to Feb 28, 2013
Download DSPBR Key Information Memorandum cum NFO application Form
Download DSPBR RGESS Scheme Information Document
NFO Period of IDBI Capital Rajiv Gandhi Equity Savings Scheme:
Feb 11, 2013 to Feb 25, 2013
As Per ADDENDUM No. 01/2013 New Fund Offer Period Cover page of the SID & KIM and page 21 of SID pertaining to New Fund Offer period are modified as follows : NFO opens on : February 9, 2013 NFO closes on : March 9, 2013
Download IDBI RGESS NFO Application Form
Download IDBI Key Information Memorandum cum NFO application Form
Download IDBI RGESS Scheme Information Document
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b) Where Can I download the applications for available NFO’s?
Please download NFO applications including Scheme Information Documents (SID) and Key information Memorandum (KIM). Also You can get applications from local offices of AMC/ Mutual fund distributors/ AMC website etc.,
1) What is Rajiv Gandhi Equity Savings Scheme, 2012 (RGESS)?
RGESS is a scheme announced by Govt of India for new retail investors with an intention to create an equity culture among new retail investors by offering one time tax benefit.
2) Does RGESS offer any tax benefits?
A new section 80CCG under the Income Tax Act, 1961 on ‘Deduction in respect of investment under an equity savings scheme’ has been introduced to give tax benefits to ‘New Retail Investors’ who invest up to Rs.50,000 in ‘Eligible Securities’ and have gross total annual income less than or equal to Rs.10 Lakhs.
3) Who is a ‘New Retail Investor’?
A ‘New Retail Investor’ is any resident Individual ● who has not opened a demat account and has not made any transactions in the equity or derivative segment as on the date of notification of the scheme i.e., November 23, 2012. OR ● who has opened a demat account as a first holder, but has not transacted in the equity or derivate segment till November 23, 2012. OR ● who has a demat account as a joint holder.
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4) What are eligible securities ?
● Equity shares of companies which are included in either CNX-100 of NSE or BSE-100 or equities of public sector enterprises which are categorized as Maharatna, Navratna or Miniratna by the Central Government. ● Exchange Traded Funds and Mutual Fund schemes with RGESS eligible securities as underlying. ● Follow on public offer of BSE-100 or CNX-100 and public sector enterprises which are categorized as Maharatna, Navratna or Miniratna. ● New fund offers of eligible mutual fund schemes. ● IPOs of eligible public sector undertakings. ● The details of eligible securities are available at the website of NSE (www.nseindia.com) & BSE (www.bseindia.com).
5) What is the maximum investment amount required for availing tax benefits in RGESS?
You can invest any amount upto Rs.50,000 for availing tax benefits in RGESS.
6) How much tax deduction will I be eligible under RGESS?
Under RGESS, you are eligible for a tax deduction on 50% of the amount invested. Let us say, you invest Rs.50,000 under RGESS, the amount eligible for tax deduction from your income will be Rs.25,000. Alternatively, if you invest Rs.40,000 under RGESS, the amount eligible for tax deduction will be Rs.20,000.
7) Is this tax deduction of maximum of Rs.50,000 over and above limit of Rs.1,00,000 currently available under Section 80C of Income Tax Act ?
Yes. You can avail Rs.1,00,000 under Section 80C of Income Tax Act and Rs.25,000 for maximum investment of Rs.50,000 under 80CCG.
More Frequently Asked Questions on Rajiv Gandhi Equity Savings Scheme
8) What will be the mode of holding eligible securities?
The mode of holding eligible securities under RGESS will be in a ‘Demat account’.
9) How can I open a demat account?
You can open a demat account with any Depository Participant (DP) of CDSL or NSDL.
10) What are the formalities that I need to fulfill at the time of opening demat account ?
You will be required to fulfill the KYC requirements i.e., submit proof of PAN/identity, address, etc. as prescribed by SEBI to DP where you wish to open a demat account. along with declaration in prescribed format for availing RGESS benefits.
11) Can I use an existing demat account for RGESS?
In case you already have a demat account and are otherwise eligible for RGESS benefit, you can designate your existing demat account as a RGESS account by approaching your DP.
12) Is there any specific document to be submitted to the DP for designating the demat account for RGESS ?
Yes. You should submit a declaration in ‘Form A’ duly signed by the account holder(s) for designating the demat account for RGESS.
13) Where will I get ‘Form A’?
You can get Form A from your DP‘ , where you have designated your demat account for RGESS. Download sample Form A’
14) Can I hold other securities i.e., other than eligible securities in my demat account designated for RGESS ?
Yes. Other securities (viz., equity shares, debentures, bonds, mutual fund units, etc.) can be held in the demat account designated for RGESS.
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