Tax Saving Bond
The investor can choose any/all of the following options in respect of Tax Saving Bond :
| Option | I | II | III | IV |
|---|---|---|---|---|
| Tax Benefit under Section | 88 | 88 | 88 | 88 |
| Issue Price (Rs.) | 5,000 | 5,000 | 5,000 | 5,000 |
| Face Value (Rs.) | 5,000 | 6,250 | 5,000 | 7250/- |
| Tenure | 3 years | 3 years 4 months | 5 years | 5 years 4 months |
| Interest (%) (p.a.)* | 7.00 | DDB@(YTM 6.9 %) | 7.25 | DDB@(YTM 7.2 %) |
| Interest Payable | Annually | DDB@ | Annually | DDB@ |
| Yield to Investor (%) * + # (Including Tax Benefits) | 13.8 | 12.6 | 11.6 | 10.7 |
| Interest Payment Dates | March 01 | DDB@ | March 01 | DDB@ |
| Redemption date | February 26, 2006 | June 26, 2006 | February 26, 2008 | June 26, 2008 |
@ Tax Saving Bond Options II and IV are in the nature of Deep Discount Bond (DDB), hence no periodic interest is payable
* Subject to TDS as per the then prevailing tax laws.
+ The yield has been calculated considering the tax rebate of 15% available to the investor and assuming that a surcharge of 5% of tax is payable in case of all the options
# Rounded off to nearest multiple of 0.1.
