Wednesday, August 5, 2015

Income Tax - India

Income tax TDS for rental property for rent exceeding Rs50,000 per month:http://www.business-standard.com/article/pf/tds-rule-not-for-multiple-tenants-117061300899_1.html

Gifted property is not taxed:
http://www.livemint.com/Money/psO8XDo2461InqGeCQkuAN/Property-gifted-to-parents-is-exempt-from-tax-in-India.html
eNPS: http://www.goodreturns.in/classroom/2016/01/enps-how-register-nps-online-make-contribution-416209.html


Transmission of mutual funds (from owner to nominee or heir): http://economictimes.indiatimes.com/mf/analysis/learn-with-et-mutual-funds-transmission-of-mutual-fund-units/articleshow/58040944.cms?from=mdr
Cost of inflation index from 1982 to now: http://www.charteredclub.com/cost-inflation-index/ or http://www.bemoneyaware.com/blog/cost-inflation-index/

1982:            100
1990-1991:   182
2000-2001:   406
2002-2003:   447
2015-2016: 1081

How returns from various asset classes are taxed :
EQUITY:
Stocks:
1. If you hold on to them for a year, the long-term capital gain is tax free
2. Short-term capital gain is taxed at 15%
3. Dividends are tax free
DEBT FIXED INCOME INSTRUMENTS:
Savings a/c:
1. Interest up to Rs 10,000 is tax free, taxed at slab rate after that
2. TDS not deducted on savings interest.
Fixed deposits:
1. Full interest taxed at slab rate
2. TDS of 10% if interest in any financial year crosses Rs 10,000
Recurring deposits :
1. Full interest taxed at slab rate
2. TDS not deducted on RD interest
Tax-free bonds:
1. Full interest is tax free
2. The long-term capital gain (after holding for 1 year) taxed at 10%
3. Being interest bearing instruments, no indexation benefit allowed
4. Short-term capital gain taxed at marginal rates.
Normal bonds and debentures:
1. Full interest taxed at slab rate TDS of 10% if interest in any financial year crosses the Rs 5,000 mark
2. The long-term capital gain (after holding for 1 year) taxed at 10%
3. Being interest bearing instruments, no indexation benefit allowed
4. Short-term capital gain taxed at marginal rates.
MUTUAL FUNDS:
Equity funds :
1. Long-term capital gain (after holding for 1 year) is tax free
2. Short-term capital gain is taxed at 15%
3. Dividends are tax free
Arbitrage funds: 
(Provided they maintain equity fund status)
1. Long-term capital gain (after holding for 1 year) is tax free
2. Short-term capital gain is taxed at 15%
3. Dividends are tax free
Equity oriented balanced funds:
1. Long-term capital gain will be tax free
2. Short-term capital gain taxed at 15%.
3. Dividends are tax free
Debt funds :
1. Long-term capital gain (after holding for 3 years) is taxed at 20% after indexation
2. Short-term capital gain taxed at marginal rates
3. Dividends are tax-free in the hands of the investor, but scheme pays a very high dividend distribution tax of 28.32%
Debt-oriented balanced funds :
1. Long-term capital gains (after holding for 3 years) taxed at 20% after indexation
2. Short-term capital gain taxed at marginal rates
3. Dividends are tax-free in the hands of investors, but scheme pays a very high dividend distribution tax of 28.32%
Gold funds:
1. Long-term capital gain (after holding for 3 years) taxed at 20% after indexation
2. Short-term capital gain taxed at marginal rates.
GOLD :
Gold bullion and ornaments :
1. Long-term capital gain (after holding for 3 years) taxed at 20% after indexation
2. Short-term capital gain taxed at marginal rates.
Gold bonds :
1. Small interest received in the middle will be taxed at slab rates
2. Long-term capital gains (after holding for 1 year) taxed at 10%
3. Being interest bearing instruments, no indexation benefit allowed
4. Short-term capital gains taxed at marginal rates.
INSURANCE :
Endowment policies 
1. Final proceeds tax free if premium in any year did not exceed 10% of the sum assured
2. TDS of 2% if the total receipt crosses Rs 1 lakh in financial year
3. Investors should consider service tax paid on premiums also while calculating returns
4. For endowment plans, it is 3.5% for first year's premium and 1.75% for the renewal premium.
Ulips :
For ULIPs, service tax is 14% on all charges (like mortality charges, AMC fees, switch fees, etc)
REAL ESTATE :
1. Rent received (or notional rent for the locked up second home) are taxed at slab rate
2. Deductions available for rent includes property tax, repair costs, home insurance, etc
3. The long-term capital gain (after holding for 3 years) is taxed at 20% after indexation
4. Short-term capital gain is taxed at the marginal rates.
REAL ESTATE INVESTMENT TRUST (REIT) :
1. Long-term capital gain (after holding for 1 year) from REIT units listed and traded in stock exchanges will be tax free 
2. Short-term capital gain from REIT units listed and traded in stock exchanges will be taxed at a lower rate of 15%

E-Filing
Credit Details: https://incometaxindiaefiling.gov.in/e-Filing/UserLogin/LoginHome.html?nextPage=taxCred


Check status of tax return: 





Treatment of Losses for Gains:




Tax Rates And Exemptions For FY 2015-16:


Incomes That Are Not Taxable In India:
Pension Plan and Tax

Claiming on waiver on tax for vacant house - apparently when the flat is not let out and when waiver clause (section 23(1)(c) of the income tax Act.) is used, the assessing officer may not agree: 

Income Tax Dept Will Not Follow Up On Assesses Who Are Evading Less Than Rs 5000 (About USD 80)
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