Investment in rgess
This query is : Resolved
20 July 2013
SIR/MADAM
WHAT IS THE TAX TREATMENT OF INVESTMENT IN RAJIV GANDHI EQUITY SAVING SCHEME. UNDER WHICH SECTION CAN CLAIM DEDUCTION?
WHAT ARE THE CONDITIONS?
WHAT IS THE TAX TREATMENT OF INVESTMENT IN RAJIV GANDHI EQUITY SAVING SCHEME. UNDER WHICH SECTION CAN CLAIM DEDUCTION?
WHAT ARE THE CONDITIONS?
20 July 2013
u can invest upto rs. 20000/- and deduction will like u/.s 80C it will become 120000/-
01 August 2024
The Rajiv Gandhi Equity Savings Scheme (RGESS) was a scheme introduced to encourage investments in the equity market. Here's a summary of the tax treatment, conditions, and relevant section:
### **Tax Treatment and Deduction**
- **Section 80CCG**: The RGESS allowed eligible taxpayers to claim a deduction under Section 80CCG of the Income Tax Act. This section was specifically designed for the RGESS and provided a deduction of up to ₹25,000 in a financial year on investments made in eligible securities.
### **Conditions for Claiming Deduction**
1. **Eligibility**:
- **Income Limit**: The scheme was available for new investors whose gross annual income did not exceed ₹12 lakhs.
- **Investment Limit**: The maximum investment eligible for deduction was ₹50,000. A 50% deduction on this amount (i.e., ₹25,000) could be claimed.
2. **Investment**:
- Investments needed to be made in specified equity shares or equity-oriented mutual funds.
- Investments had to be made through a demat account.
3. **Lock-in Period**:
- The investments under RGESS had a lock-in period of three years. This meant that the investments needed to be held for at least three years to claim the deduction.
- During the lock-in period, the investor was not allowed to sell or transfer the securities.
4. **Claiming the Deduction**:
- The deduction could be claimed while filing the income tax return for the financial year in which the investment was made.
### **Additional Points**
- **Expiry of RGESS**: Note that the RGESS scheme was discontinued after the financial year 2017-18. Therefore, it is no longer available for new investments or claims.
- **Documentation**: Investors were required to maintain proper documentation of their investments and hold the necessary certificates to claim the deduction.
Ensure to check the latest updates and consult with a tax advisor for detailed guidance tailored to your specific situation, especially if you are looking into historical claims or impacts.
### **Tax Treatment and Deduction**
- **Section 80CCG**: The RGESS allowed eligible taxpayers to claim a deduction under Section 80CCG of the Income Tax Act. This section was specifically designed for the RGESS and provided a deduction of up to ₹25,000 in a financial year on investments made in eligible securities.
### **Conditions for Claiming Deduction**
1. **Eligibility**:
- **Income Limit**: The scheme was available for new investors whose gross annual income did not exceed ₹12 lakhs.
- **Investment Limit**: The maximum investment eligible for deduction was ₹50,000. A 50% deduction on this amount (i.e., ₹25,000) could be claimed.
2. **Investment**:
- Investments needed to be made in specified equity shares or equity-oriented mutual funds.
- Investments had to be made through a demat account.
3. **Lock-in Period**:
- The investments under RGESS had a lock-in period of three years. This meant that the investments needed to be held for at least three years to claim the deduction.
- During the lock-in period, the investor was not allowed to sell or transfer the securities.
4. **Claiming the Deduction**:
- The deduction could be claimed while filing the income tax return for the financial year in which the investment was made.
### **Additional Points**
- **Expiry of RGESS**: Note that the RGESS scheme was discontinued after the financial year 2017-18. Therefore, it is no longer available for new investments or claims.
- **Documentation**: Investors were required to maintain proper documentation of their investments and hold the necessary certificates to claim the deduction.
Ensure to check the latest updates and consult with a tax advisor for detailed guidance tailored to your specific situation, especially if you are looking into historical claims or impacts.
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