Liquid Funds vs Savings Bank

Liquid Mutual Funds vs Savings Bank

Savings Bank

Deposit Amount

Start Date

End Date

Liquid Fund

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Select AMC

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Income Tax Rate

Savings Bank Interest Rate

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Pre-Tax Return	Investment Amount	Redeemed / Maturity Amount	Total Interest / Profit Amount	Annual Interest / Return (%)
Savings Bank Deposit	100000	104,011	4,011	4.0
ICICI Prudential Liquid Fund - Growth	100000	107,376	7,376	7.36

Post Tax Return	Pre-tax Interest / Profit Amount	Capital Gains Tax	Indexed Amount	Income / Capital Gains Tax	Post Tax Interest / Profit Amount
Savings Bank Deposit	4,011	Not Applicable	Not Applicable	0	4,011
ICICI Prudential Liquid Fund - Growth	7,376	Short Term	Not Applicable	2,213	5,163

Note:

1. Short Term in case of debt funds is defined as less than or equal to 3 years. Long Term in case of debt funds is defined as more than 3 years.

2. Short term gain formula:

Short term capital gain = Amount realised - Amount invested

Short term capital gain tax = Short term capital gain * Tax rate of the investor

3. Long term gain formula:

Indexed cost of acquisition = Amount invested * (Index in Year of redemption / Index in year of investment)

Long term capital gain = Amount realised - Indexed Cost of Acquisition

Long term capital gain tax = Long term capital gain (post indexation) @ 20%

4. Please note that Section 80TTA grants a deduction on savings account interest up to Rs 10,000 per annum. It applies to all individuals and HUFs other than senior citizens (those above 60). Senior citizens can instead take advantage of a bigger deduction of Rs 50,000 per annum which includes both savings and FD interest under Section 80TTB.

5. Section 80TTA was introduced in the Finance Bill of 2013 and became applicable from the Financial Year of 2012-13 onwards. Whereas deduction under Section 80TTB is applicable w.e.f. April 01, 2018.

6. No tax has been applied on the gains of saving bank interest in this tool.

Disclaimer : We have gathered all the data, information, statistics from the sources believed to be highly reliable and true. All necessary precautions have been taken to avoid any error, lapse or insufficiency; however, no representations or warranties are made (express or implied) as to the reliability, accuracy or completeness of such information. We cannot be held liable for any loss arising directly or indirectly from the use of, or any action taken in on, any information appearing herein. The user is advised to verify the contents of the report independently.

Returns less than 1 year are in absolute (%) and greater than 1 year are compounded annualised (CAGR %). SIP returns are shown in XIRR (%).

The Risk Level of any of the schemes must always be commensurate with the risk profile, investment objective or financial goals of the investor concerned. Mutual Fund Distributors (MFDs) or Registered Investment Advisors (RIAs) should assess the risk profile and investment needs of individual investors into consideration and make scheme(s) or asset allocation recommendations accordingly.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Past performance may or may not be sustained in the future. Investors should always invest according to their risk profile and consult with their mutual fund distributors or financial advisor before investing.