Showing posts with the label Tax Planning

Myth: Insurance alone help to save Tax

Myth: Insurance alone help to save Tax The Central Board of Direct Taxes - Ministry of Finance extended the deadline to August 31 from the earlier July 31st, for Income Tax returns on Individual (Order u/s. 119 of the Income Tax act, 1961). There is a time that the Individual Tax payers rush to the Insurance Company / Agent to get their Tax Benefits. I don't want to criticize or against anyone here. But the truth is why we have to rush to buy the Insurance policies urgently on behalf of Tax Saving. We are aware that our regular pay check (Salary) will rise by every year and the Bonus or any incentives where we getting. Without a proper financial planning, buying an insurance product is nothing but, putting our hard earned money in a garbage. When we become a Tax Payer of a country, we can find the best way to get tax benefits. We thought that the Income tax is favored for the Corporate where we work for and the Government is involved in Tax Robbery. Most of us rely on the Insurance

How to save tax if you are earning up to 6 Lakh in a Financial year ? - Easy Calculation

How to save tax if you are earning up to 6 Lakh in a Financial year ? - Easy Calculation In the Budget India 2019, the Finance Minister Mr. Piyush Goyal announced that there is 100 percent or Full Tax Rebate in Income tax for those earning up to Rs. 5 Lakh in a Financial Year. One should note that there is not an exemption of tax up to 5 Lakh rupees, but it is a Tax Rebate. If an Individual earns Rs. 5 Lakh per annum in a 2019-20 Fiscal year, his income tax rate will be 5 percent. At 5 percent rate, he should pay the tax amount of Rs. 12,500 plus other surcharges. It will be deducted as TDS(Tax deducted at source) by the Employer and then the employer will pay this tax to the Income Tax Department. So, what is the full tax rebate for those earning up to 5 Lakh rupees ? When an individual is file his Income Tax returns in the Assessment year (2020-21), the TDS amount of Rs. 12,500/- deducted by the Employer, will get refunded to the Individual's account. It is referred as the Full T

Mutual Funds Taxation - Simply Explained

Mutual Funds Taxation - Simply Explained Generally, there is no TDS (Tax Deducted at Source) applicable for the Mutual Funds and Shares in India. One should declare these type of income as 'Other source of income' while filing the Income Tax returns. For the Mutual Fund schemes, the Taxation is divided into two categories - Debt Funds and Equity / Hybrid Funds. Hybrid Funds (Earlier Balanced Fund) is a combination of both debt and equity based funds. In case of Investing in Debt oriented funds, the holding period of a funds will tells the taxation rate. As you can see in the below table, If an investor redeem his money from the debt fund with in three years from the time of investment, then he or she will be taxed as per the Income Tax Slab. If the holding period is more than 3 years and the redemption is happening, then the Tax rate would be 20 percent with Indexation Benefit. For instance, Rs. 1 Lakh will be invested in a Debt Fund Scheme of a particular AMC (Asset Management

Link your Aadhaar to your PAN – Before 31st March 2019

Link your Aadhaar to your PAN – Before 31st March 2019 (Extended to September 2019)* If you are not an income tax payer, but you may received an Email from the Income Tax Department recently (Income Tax India E Filing Website). That email tells you the timeline of link your Aadhaar number with your PAN (Permanent Account Number) before 31st March, 2019. You cannot file the income tax returns in future, if you do not link the Aadhaar to your PAN before the said date. It is said to be better link the Aadhaar Number with the PAN, even if you are not a regular Tax Payer. Still, there is an exempt for the below categories from PAN-Aadhaar linking process. It is also not mandatory for the following persons, Resident Individuals in the state of Assam, Jammu and Kashmir and Meghalaya Individuals who are not citizen of India Individuals who are Non-resident Individuals who are 80 Years or Above. For linking Aadhaar Number with your PAN, just go to the below link, Income Tax India E

5 Best & Top performing Tax Saving - ELSS Funds - 2019

5 Best & Top performing Tax Saving - ELSS Funds - 2019 There are nearly 50 days to complete this current financial year 2018-2019. The date of Income tax filing will start from the April 1,2019 for the FY2018-19 (Assessment year 2019-20). Tax Rebates and Standard Deduction amount increased in the interim budget of this year, will apply for the next financial year 2019-20. There is no change on Income tax slab and its rate in the recent budget. Most of us, using the Section 80(C) of Income Tax act during the last minute to get the tax exemption for their Taxable income. So, they are impatient and doing their tax saving investments between January and March every year, it's not a good thing. The best time to start to invest for tax saving is at the start of the Financial year and it must be related on your Financial Goals. Under Section 80C of Income tax act, one can save up to Rs. 1.5 lakh in a Financial year. It is also not good to put your whole money in an insurance product f

The Fantastic Four - Know this before Investing

The Fantastic Four - Know this before Investing When we go for Investing, we just blindly putting our money into some products that are ready to sell. We are not aware of the basic analysis about the term, Money or Finance. But still, our goal is to achieve a good profit on expectation. One can put their earned or reserved money into financial products, stocks, real estate property or any commercial things. Here are the four important things you should know this before invest it. Fantastic Four (SLRT): Safety Liquidity Returns Tax These four things are the primary that one should follow, before investing. For Instance, if i am going to put my money in a bank deposit - What about the safety of my money ? We need the least thing of Capital Protection rather than Capital Appreciation. I am not telling the Capital Appreciation is not important, but Protection is the primary one for anything. The Liquidity is nothing but, a cash - If i need my money that deposited, i want to bea

Frequently Asked Questions (FAQs) regarding taxation of long-term capital gains

  Frequently Asked Questions (FAQs) regarding taxation of long-term capital gains(LTCG) proposed in Finance Bill, 2018-reg,   ( This article is the press release of Income Tax Department - FAQ regarding taxation of long term capital gains - Budget India 2018 dated 4th Feb, 2018 ) Under the existing regime, long term capital gains arising from transfer of long term capital assets, being equity shares of a company or a unit of equity oriented fund or a unit of business trust, is exempt from income-tax under clause (38) of section 10 of the Act. However, transactions in such long-term capital assets are liable to securities transaction tax (STT). Consequently, this regime is inherently biased against manufacturing and has encouraged diversion of investment to financial assets. It has also led to significant erosion in the tax base resulting in revenue loss. The problem has been further compounded by abusive use of tax arbitrage opportunities created by these exemptions. 2. In order to mi

Long Term Capital Gains Tax - Equity - Explained 2018

  Long Term Capital Gains Tax - Equity - Explained 2018   Budget India 2018 reported by the Finance minister Mr. Arun jaitley last week (1st Feb, 2018) that everyone was expected on Income Tax slab changes and related on Tax saving things. But, nothing has done on these expectations. The Budget proposed to tax for the equity on Long term Capital Gains (LTCG), and this unseen destined the investors in the market on same day. They started the Long term Capital Gains for equity taxed at 10 % without indexation, if the capital gains exceeding more than 1 lakh rupee. This is applicable too for equity oriented mutual funds. This proposed tax is not a new thing, but before the Former Finance minister Mr. Chidambaram revamping it in the budget 2004-05, proposed to abolish the tax on long term capital gains for equity and recommend to levy a small tax called, 'Securities Transaction Tax (STT) ". Now, Mr. Arun Jaitley brought back this with tax at 10 %, but not removing the Securities

Adjusted Returns on Investment

Adjusted Returns on Investment   If someone asking you,  What is your monthly pay check or Salary ? Then, we are hesitated to tell or show the exact numbers on salary, even after our deduction from salary :) . We are thinking about that we are protecting our income numbers ! That's not a matter, either showing the pay slip or not. But, on our Investment info, we have to be careful about the returns on numbers we earned it. We just enjoying to show this much returns i had on my investments or I had a profit of XXXXX from my investments. But, do you know what is your real returns received on your hand ? Returns on Investment can by type of: Inflation Adjusted Tax Adjusted Risk Adjusted From the previous article, we have seen that about the difference between Real Rate and Nominal Rate of Return. It clearly indicates that we must aware about the Inflation, it hurts our retirement planning and Goal based investments. For Example,  If our Return is 10 % from the investment amo

How to E-file ITR 1 online ?

How to E-file ITR 1 online ?   Income Tax Return filing is not so hard, but if you get the basic things right. Nowadays, the government also encouraging to disclose your earning information and the technology really helps to ease the information online. Income Tax Return is a task for the individuals, especially for the employees is a needy one. Employers would make TDS for the employees on account and then the employees can make the file easily through the part of Form 16.   What is ITR- 1 ?   The Income Tax Return (ITR) - 1 is a document or form that required to file by an individual whose total income for the Assessment year includes,   Income from Salary or Pension (or) Income from House Property (or) Income from other sources. ITR- 1 also known as ' Sahaj ' meaning easy in Hindi Language. The following individuals who cannot file this ITR- 1: If an individual's total income exceeds Rs. 50 Lakhs If agriculture income is more than Rs. 5000 If you have