Definite Impact on Pension Funds

Most of existing tax saving investment will not be eligible for deduction under the DTC. As an alternative, the focus has shifted to long term options with pension funds leading the way. An annuity is an investment that gives out a regular income to the investor. Pension plans require an investor to put at least 65 percent of corpus received on maturity in an annuity which then gives him monthly pension. Although more details are expected, DTC has planned to make annuity income exempt from taxation which makes them good tax saving instrument. The New Pension scheme is low cost pension fund which an investor can consider.