What Is Indexation Definition Formula Cii Chart And Effect On Debt Effect of indexation on debt funds. now let us understand the effect of indexation on the debt funds of investors with an example: situation. mr. a (investor) purchase a debenture of ₹ 100 in 2016 and sold at ₹ 140 in 2019. cost inflation index (cii) for the year 2016 was ₹ 825 and cost inflation index (cii) for the year 2019 is ₹ 979. Indexation formula. you can calculate the indexed cost of purchase using the following mathematical formula: indexation = original cost of acquisition * cii of the given year cii of the base year. where, cii of the given year is the cost inflation index for the year of sale. cii of the base year is the cost inflation index for the year of.
What Is Indexation Definition Formula Cii Chart And Effect On Debt Indexation is a system or technique used by organizations or governments to connect prices and asset values. it's accomplished by linking adjustments made to the value of a good, the price of a. Indexation is the reason why debt funds are considered an excellent fixed income investment option when compared to conventional fixed deposits (fds). indexation makes the game of investment a win win affair. the rate of inflation to used for indexation can be obtained from the government’s cost inflation index (cii). Indexation can be defined as a technique that can be used to adjust the amount byways of a price index to maintain the purchasing power after excluding the effect of inflation. the formula to calculate indexation cost is represented below, indexation = original cost of acquisition x cii of the given year cii of the base year. 4 rating. mutual fund indexation is the process of adjusting the cost of acquisition for inflation to reduce the tax outgo. read this post to learn more. there was a major change in the taxation rules from 1 april 2023 onwards by finance act, 2023. before 1 april 2023, for the purpose of taxation, the indian mutual fund universe is basically.
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