Income-tax Concessions and Choice of Financial Assets

Income-tax Concessions and Choice of Financial Assets N J Jhaveri Currency, bank deposits, units of the Unit Trust of India, provident funds, life insurance policy, and preference and equity shares, are some of the alternative financial assets in which an individual or a household may hold savings. Several factors may affect the choice of assets. This paper does not attempt to quantify any of these factors. It is confined, instead, to an analysis of income-tax concession which is one of the factors affecting the rate of return on different financial assets eligible for such concessions.