Review: UTI Long Term Advantage Fund (Save Tax benefit)

UTI Mutual Fund has come out with the NFO of its UTI Long Term Advantage Fund
UTI Mutual funds have been the front runners in the mutual fund industry in India and they have established a reputed name in money management. They have come out with this new fund called UTI Long Term Advantage Fund. Though the NFO is open from 19th December onwards, the scheme offering tax benefit will make it an attractive and considerable option for the people who want to desperately invest to save tax at the last minute.

Another thing is that presently, the markets are having a high level of volatility and have seen hovering around the bottoms. The 3 year lock-in period will ensure your money is invested in for a relatively long term of 3 years and may appreciate, provided you trust the UTI Fund management and they have good stock picking skills.
Another good feature is that this scheme being closed ended, does not qualify to claim entry load charges. Hence, it is attractive for investors who are dying for making a last minute tax savings investments.

Details of the scheme: 10 year long close ended ELSS scheme, which also offers tax benefits under section 80 C of the Income Tax Act.
NFO Period: From December 19, 2007 to March 19, 2008.

Options Available
Growth Option and Dividend Option with Payout and Reinvestment facilities.

Tax Benefit Offered: Yes, under section 80 C of Income Tax Act

Lockin Period: 3 years (minimum)

Minimum initial investment: Rs.500/- and in multiples of Rs.500/- thereafter with no upper limit.
But as per section 80 C of the Income Tax Act, 1961, the tax benefit will be available only upto a maximum amount of Rs.1,00,000/-

Entry Load: The scheme, being a close-ended scheme, is not permitted to charge Entry Load.

Exit Load : Nil. If the investor opts for redemption before the completion of 10 years the proportionate unamortized portion of the NFO expenses outstanding as on the date of the redemption shall be recovered from such investors.

Fund Manager: Ms. Swati Kulkarni
The scheme aims to provides an opportunity for capital appreciation through investment in well managed high quality companies that have potential to grow at reasonable rate in the long term

The so-called claimed benefits of investment in Equity Linked Saving Scheme

1 Opportunity for capital appreciation through power of equities


2 Tax benefits under Sec 80 C of Income Tax Act – 1961 - Contribution made by individuals & HUFs will be eligible for deduction of the whole of the amount paid or deposited subject to maximum of Rs. 100000/-
(along with other specified investments) under Section 80 C of Income Tax Act, 1961 as provided therein.


3 No long term capital gains tax (Subject to Securities Transaction Tax) on investment under equity oriented fund including ELSS Scheme.


4 Tax free dividends.

5 Shorter lock-in period in comparison to most of other tax saving instruments. 6 3 year lock- in period helps in minimizing volatility. However, the biggest advantage for investing in this scheme is that due to the lock-in period of 3 years, there will be no Long Term Capital gains tax and dividends are also taxfree

Table of Contents