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  #1  
Old 20th February 2013, 10:49 AM
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Default Demat and RGESS Mutual Funds?



RGESS funds are there for those who don't want to put money into stocks and don't hold any demat account (which I have been hearing all along).

But when you try to make direct purchase it says demat details. If not ticked it says demat is must else it won't count as deduction.

I tried at UTI and HDFC both asks for same. I guess now I need to open demat account.
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  #2  
Old 20th February 2013, 11:17 AM
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Originally Posted by magnet View Post
RGESS funds are there for those who don't want to put money into stocks and don't hold any demat account (which I have been hearing all along).
An investor may have had a demat account for many years and used it for bonds, debentures etc. but if he has not done any transaction in equities or equity derivatives, he is eligible for RGESS tax benefits.
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  #3  
Old 20th February 2013, 11:52 AM
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Originally Posted by Alchemist View Post
An investor may have had a demat account for many years and used it for bonds, debentures etc. but if he has not done any transaction in equities or equity derivatives, he is eligible for RGESS tax benefits.
Investor (my father) doesn't have a demat account except fundsindia mutual fund account.

And this is the message which comes up.

http://i.imgur.com/VJzp12V.jpg
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  #4  
Old 20th February 2013, 12:15 PM
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Quote:
Originally Posted by magnet View Post
Investor(my father) doesn't have a demat account except fundsindia mutual fund account.

And this is the message which comes up.

http://i.imgur.com/VJzp12V.jpg
Yes, if you or (your father) do not/does not avail tax benefits then don't care about this message.

You still can be an investor in this fund.

Happy Investing!
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  #5  
Old 20th February 2013, 12:21 PM
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Originally Posted by San Yad View Post
Yes, if you or (your father) do not/does not avail tax benefits then don't care about this message.

You still can be an investor in this fund.

Happy Investing!
But what's the point of investing if my father doesn't want to claim tax deduction.

Point is he doesn't have any demat account.And right now I am not sure where to open demat account for my father HDFC, Zerodha or Fundsindia.

Hence was thinking to invest directly without demat mess.

But it looks one need to have a demat account to invest in it or you can't claim deduction.
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  #6  
Old 20th February 2013, 12:21 PM
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Quote:
Originally Posted by magnet View Post
Investor (my father) doesn't have a demat account except fundsindia mutual fund account.

And this is the message which comes up.

http://i.imgur.com/VJzp12V.jpg
Demat account is mandatory for RGESS.

An investor must first open an RGESS demat account to take benefit of the scheme.

If the invest already has a demat account, he can designate it as an RGESS account.
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  #7  
Old 20th February 2013, 12:25 PM
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Originally Posted by Alchemist View Post
Demat account is mandatory for RGESS.

An investor must first open an RGESS demat account to take benefit of the scheme.

If the invest already has a demat account, he can designate it as an RGESS account.
Why investor needs Demat a/c when he purchases direct from fund house by clicking NO for demat account?

If you can buy through mutual fund house then can't he sell after the lock-in period over as with other mutual funds?

If he can do so then where is the Demat a/c needed?

Happy Investing!
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  #8  
Old 20th February 2013, 12:30 PM
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Originally Posted by San Yad View Post
Why investor needs Demat a/c when you purchase direct from fund house by clicking NO for demat account?
I don't know why but for RGESS demat account is mandatory.

Quote:
Vivek: The scheme clearly says that you need to have a demat account and that it is not applicable to anyone who has done any transaction till now. Could you elaborate a bit on difficulty to enter?

Monika: Right, you need a demat account and it should be the first investment that you will make.
RGESS is flawed in its construction. It should be scrapped - Livemint
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Old 20th February 2013, 05:33 PM
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Originally Posted by Alchemist View Post
I don't know why but for RGESS demat account is mandatory.

RGESS is flawed in its construction. It should be scrapped - Livemint
I really don't understand any thing what she mentioned in that conversation.

Except one thing that it is complex investment.

Now come back to simple applying by selecting NO demat account through fund house. What would happen if investor applies successfully through this route?

Will his investment get rejected? I highly doubt.

Happy Investing!
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  #10  
Old 20th February 2013, 06:51 PM
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Originally Posted by San Yad View Post
Now come back to simple applying by selecting NO demat account through fund house. What would happen if investor applies successfully through this route?

Will his investment get rejected? I highly doubt.
No, it won't be rejected, but to claim tax benefit, a demat account is mandatory.

Depositories have to certify "new retail investor status" of investors when they designate their demat accounts as RGESS demat account.

That isn't possible with directly purchased mutual funds.
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  #11  
Old 23rd February 2013, 10:05 PM
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Interesting but in my opinion incorrect info from HDFC's stable

HDFC RGESS Faq

Quote:
5. I am already having units of mutual fund and / or Exchange Traded Funds; Am I eligible for the
RGESS?
Yes. Prior investments in mutual funds and Exchange Traded Funds do not make an investor
ineligible for RGESS. However, you need to invest afresh in RGESS eligible mutual fund /ETF
schemes and hold them in a demat account to avail of the benefits under RGESS.
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  #12  
Old 24th February 2013, 06:59 AM
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Originally Posted by Atiker View Post
Interesting but in my opinion incorrect info from HDFC's stable

HDFC RGESS Faq
Actually, it may be correct.

I am not sure.

The official eligibility criteria for RGESS covers only equities and derivatives, but not mutual funds.

Quote:
"new retail investor" means the following resident individuals:-

(a) any individual who has not opened a demat account and has not made any transactions in the derivative segment as on the date of notification of the Scheme;

(b) any individual who has opened a demat account before the notification of the Scheme but has not made any transactions in the equity segment or the derivative segment till the date of notification of the Scheme,

and any individual who is not the first account holder of an existing joint demat account shall be deemed to have not opened a demat account for the purposes of this Scheme.
http://www.incometaxindia.gov.in/arc...S_30112012.pdf
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  #13  
Old 3rd March 2013, 07:50 PM
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Quote:
Originally Posted by Alchemist View Post
Actually, it may be correct.

I am not sure.

The official eligibility criteria for RGESS covers only equities and derivatives, but not mutual funds.

http://www.incometaxindia.gov.in/arc...S_30112012.pdf
I guess in this budget mutual fund has been added in said criteria. I had heard that I am sure.

Most probably by 10th March a notification regarding same will be out.
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  #14  
Old 4th March 2013, 07:32 AM
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Quote:
Originally Posted by magnet View Post
I guess in this budget mutual fund has been added in said criteria. I had heard that I am sure.
According to this news report no change has been made in the definition of "first time investor" is still the same.

Quote:
For instance, the definition of a first-time investor, fund managers say, is still confusing. Investors who have invested in mutual funds before, either through account statement format or through a demat account, can still invest in RGESS.
Budget 2013: RGESS investments open for three years now - Livemint
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