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| Posted: 24 Jun 2016 04:47 AM PDT Invest MF Online The exit load is a penalty levied by a mutual fund scheme for redeeming the investments before a stipulated period. You cannot treat it as a loss and deduct the amount from your gains once again while filing your ITR. The money you receive from the fund house (redemption proceeds) has already deducted the exit load. When you calculate your capital gains tax on this amount, you have already factored in the exit load. You cannot deduct the exit load once again from your gains while filing Income Tax Returns. Also, your calculation is wrong. The exit load of 1 per cent on your gain ofR10,000 is R100, not R1,000 as you have calculated. ----------------------------------------------- Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds Top 10 Tax Saving Mutual Funds to invest in India for 2016Best 10 ELSS Mutual Funds in india for 2016
1. BNP Paribas Long Term Equity Fund 2. Axis Tax Saver Fund 3. Franklin India TaxShield 4. ICICI Prudential Long Term Equity Fund 5. IDFC Tax Advantage (ELSS) Fund 6. Birla Sun Life Tax Relief 96 7. DSP BlackRock Tax Saver Fund 8. Reliance Tax Saver (ELSS) Fund 9. Religare Tax Plan 10. Birla Sun Life Tax Plan
Invest in Best Performing 2016 Tax Saver Mutual Funds Online For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call --------------------------------------------- Leave your comment with mail ID and we will answer them OR You can write to us at PrajnaCapital [at] Gmail [dot] Com OR Leave a missed Call on 94 8300 8300 ----------------------------------------------- |
| Posted: 24 Jun 2016 03:01 AM PDT FILE IT FORGET IT It is that time of the year when you have to sit with a paper & pen, and all your docs, to calculate your tax liability. The tax-return filing deadline is five weeks away and it is time you sat down with the required documents, calculated your liabilities or sent a refund receipt. If you are a salaried employee, Form 16 is the first document to get hold of and most of you should have received it already . If not, start hounding your HR department immediately . Going by current rules and limits, most will be in the online tax-filing category . If your income is more than `5 lakh, e-filing is manadatory .
Plus, if you want to claim a refund or your interest earning from savings bank account tops `10,000, e-filing is mandatory . You can file using the tax department's site while there are a few online platforms with better interfaces. Whichever option you use, here are five things to take care of when filing your tax returns online.
1. READING YOUR FORM 16 While on the government site you have to file the numbers yourself, some websites such as ClearTax.com lets you upload your Form 16 on the platform and directly picks up the correct figures from the form.
However, you should cross-check the figures and ensure they are correct, especially if you had switched jobs and have more than one Form 16 to refer to.You would have to recalculate your tax liability accordingly .
A common mistake is confusion between the `net taxable income' and `gross taxable income'. While tax is calculated on your `net taxable income' you have to report the `gross taxable income' -income before deductions in your ITR form.
If you are filing ITR 1, you can simply pick the figure under the head "income chargeable under the head salary.However, if your are filing ITR 2 or 2A, you will have to provide a break-up of your income.
Salary is typically reflected at item 1(a) in Form 16, allowances exempt under Section 10 are item 2, value of perquisites is item 1(b) and profits in lieu of salary are shown under 1(c). Allowances that are not tax exempt are either shown under item 1(d) or, if already included in your salary figure and not reflected separately , will be reflected in an annexure that was issued with the Form 16.
Taxpayers many time makes mistake in reporting this break-up correctly especially they get confused between the exempt and nonexempt allowance
Next, ensure that no deductions have been missed. Check whether the PF and HRA deductions have been chosen correctly . If you had changed job or forgot to submit proof of investments to your employer, you will have to manually enter data for these deductions. Your Form 16 also has the correct employer name, address and TAN. Make sure you pick this information from here as bigger companies may have multiple registered offices. In the case of online businesses, the registered company name often differs from the more popular domain name. 2. WHICH FORM TO FILL If you using the online platforms, this is an automated process. The correct ITR form gets selected automatically on the basis of the information provided by the taxpayer
However, if you are using the government site, you need to know which form is for you. Each form has it's limitations. For one, you may have income from salary only but you can't file ITR 1 if you own more than one house or have gained from trading in shares.
If you own more than one house and do not have capital gains or foreign income or assets, you can file ITR 2A.
Similarly , ITR 4S is a much simpler form to fill compared to the bulky 20-page-long ITR 4, if you have income from a business or are a freelancer.
If you choose ITR 4S, there is no need to maintain books, profit &loss statements or audits. You don't have to pay advance tax either. However, your business's gross receipts or turnover of the business should not be more than `1 crore and it should not be registered as a company .
Your tax liability would be calculated on the basis of a `presumed business income', irrespective of what your actual income may be.
Section 44AD of the Income-Tax Act says under the presumptive method, the net income is estimated to be 8% of gross receipts for businesses. This year onwards, even freelancers earning less than `50 lakh per annum can t also file ITR 4S.e A new section has been inserted in the I-T Act Section 44ADA under which n professionals with receipts of `50 lakh or less could opt for the presumptive o scheme. Their income shall be as sumed to be 50% of their receipts. So, if you have profits less than the presumptive rate, you may e still want to file the lengthier Form 4.
3. TDS AND FORM 26AS You need to cross-check your TDS deductions with the figures reflected in Form 26AS, especially if you have interest income from bank deposits or any other sources.
Form 26AS also records interest income in cases where Form 15 GH is submitted by the taxpayer. So, in case you have erroneously submit these forms where there was a tax liability , you should make corrections. The taxpayer should add this interest income to the list of `income from other sources' and compute the tax liability calculated as per tax slab rate.
Form 26AS can be downloaded from the TRACES site. The tax department's e-filing site also provides a link.However, be careful while selecting the Assesment Year (AY). Taxpayers get confused between Assessment Year (AY) and Financial Year (FY) and they end up filling up wrong year's data in the return form. This may result in a huge tax demand due to tax credit mismatch. AY is the year in which you file returns. For instance, income earned between April 1, 2015 and March 31, 2016, will be taxed in AY 2016-17. 4. DECLARING `INCOME FROM OTHER SOURCES' , CAPITAL GAINS
Once you have figured out Form 16, it is merely copying figures from it on the ITR Form. But if you have income from other sources you need to be careful.Lately , the sleuths have become vigilant and you may end up with a notice.
Income from other sources is a residuary head of income: income not chargeable under any other head is chargeable under this head. All income other than income from salary , house property , business and profession or capital gains is covered under `income from other sources'.
Typical incomes under this head include interest on bank or other deposits, taxable dividends, income from securities by way of interest, pension received by the legal heirs of an employee, income from subletting, winnings from lotteries, races and gambling. Do not miss out reporting income from a second house. Even if it is not rented out, you have to pay a tax on the basis on `deemed income'.
Good thing is that if you have incurred any specific expenses for earning any of the above income then you can claim deduction for the same too. Capital gains or losses is another section where taxpayers tend to make mistakes. Capital gainslosses have to be reported in Schedule CG of form ITR 2.
5. HOW TO E-VERIFY You may have filed your returns on time but the tax-filing process is incomplete if ITR-V doesn't reach the department within the stipulated time. You won't get your refunds and worse, your returns filing won't be considered valid if the department doesn't receive a signed or verified copy of ITR V within 120 days of filing the returns.
Apart from mailing the ITR V to the CPC in Bengaluru, you can now e-verify by linking your Aadhaar orthrough netbanking. For Aadhaar-linked verification, you have to be registered on efiling site and provide your Aadhaar number. Once the validation is done, you will receive an OTP (which will be your electronic verification code) on your Aadhaar registered mobile number, which will be valid for the next 10 minutes. Submit this to e-verify your ITR V . In case your PAN and Aadhaar details don't match or you are still not registered under UIDAI, verify using your netbanking account.  Top 10 Tax Saving Mutual Funds to invest in India for 2016 or Best 10 ELSS Mutual Funds in india for 2016
1. BNP Paribas Long Term Equity Fund 2. Axis Tax Saver Fund 3. Franklin India TaxShield 4. ICICI Prudential Long Term Equity Fund 5. IDFC Tax Advantage (ELSS) Fund 6. Birla Sun Life Tax Relief 96 7. DSP BlackRock Tax Saver Fund 8. Reliance Tax Saver (ELSS) Fund 9. Religare Tax Plan 10. Birla Sun Life Tax Plan
Invest in Best Performing 2016 Tax Saver Mutual Funds Online For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call --------------------------------------------- Leave your comment with mail ID and we will answer them OR You can write to us at PrajnaCapital [at] Gmail [dot] Com OR Leave a missed Call on 94 8300 8300 |
| PF Interest Rate and NPS Returns Posted: 24 Jun 2016 01:20 AM PDT Invest NPS Online MOST NPS INVESTORS EARNED double-digit returns in the past 3-5 years; central and state govt employees covered by the scheme earned between 9.3% and 10.15% If the 5 basis point hike in interest rate of the Employees' Provident Fund (EPF) made subscribers smile, those covered by the New Pension System (NPS) must be laughing. Most NPS investors earned double-digit returns in the past 3-5 years. Central and state government employees covered by the scheme earned between 9.3% and 10.15% during this period. The performance of individual schemes is not very helpful because NPS investors put money in a combination of funds. Therefore, Economic Times studied the blended returns of four different combinations of the equity , corporate debt and gilt funds. Ultra-safe investors are assumed to have put 60% in gilt funds, 40% in corporate bond funds and nothing in equity funds. A conservative investor would put 20% in stocks, 30% in corporate bonds and 50% in gilts. A balanced allocation would put 33.3% in each of the three classes of funds while an aggressive investor would invest the maximum 50% in the equity fund, 30% in corporate bonds and 20% in gilts. The table shows the average blended returns of the seven pension funds.
Admittedly , the short-term picture of the NPS is not very encouraging because of the negative returns from stocks in the past one year. Aggressive investors have earned less than 3% and balanced investors made only 4.93%, though ultra-safe investors who stayed away from stocks got 8.89%. But the long-term picture is different. On average, gilt funds have given 9.75% annualised returns while corporate debt funds have churned out more than 11% in the past five years. As a result, the average return for ultra-safe investors in the past five years is in double digits. The average NPS fund has given 100-125 basis points more than what the retirement savings of the estimated 3.7 crore EPF subscribers have earned during this period. Even a 100 basis point higher return can make large impact on the corpus in the long term. Will the good times continue for gilt funds and corporate bond funds?
Should you switch from EPF to NPS? This raises the critical question: should you switch from EPF to the pension scheme? The proposal to switch from EPF to NPS was announced in last year's budget and this year's budget extended a onetime tax exemption to such a shift.A le gislation to amend the Employees' Provident Fund & Miscellaneous Provisions Act has already been framed and is lying with the Law Ministry . The amendment allows EPF subscribers to make a one-time switch to the NPS. Once he shifts to NPS, the employee will have a one-time chance to return to the EPF fold. But experts believe it may not be a wise move to shift your retirement savings to the NPS because of the difference in tax treatment. While the EPF corpus is completely tax free, this year's budget has proposed to make 40% of the NPS tax free. Pension Fund Regulatory and Development Authority (PFRDA) chairman Hemant Contractor says there should be tax parity in all retirement products. Why would anybody want to shift his money from the fully tax-free EPF to the NPS where only 40% of the corpus will escape tax? If there is parity in the tax treatment, a lot of subscribers would shift from EPF to NPS," . For investors, the tax benefits are an important consideration. The new tax deduction offered on the NPS attracted investors in a big way in 2014-15, with almost 1.2 lakh new voluntary accounts opened during the year. Within nine months, the assets under management of funds for the private sector shot up more than three-fold from Rs 6,361 crore in April 2015 to touch Rs 20,261 crore by December 31, 2015. Financial advisors see another problem in the NPS. At least 40% of the maturity corpus has to be put in an annuity to earn a monthly pension. Annuity rates in India are very low compared to what other options can offer. The Senior Citizens' Saving Scheme, for instance, gives 8.6% returns compared to 6.75% offered by annuities that return the principal after death. The PFRDA wants that the investor should be allowed to look beyond annuities. ----------------------------------------------- Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds Top 10 Tax Saver Mutual Funds to invest in India for 2016Best 10 ELSS Mutual Funds in india for 2016
1. BNP Paribas Long Term Equity Fund 2. Axis Tax Saver Fund 3. Franklin India TaxShield 4. ICICI Prudential Long Term Equity Fund 5. IDFC Tax Advantage (ELSS) Fund 6. Birla Sun Life Tax Relief 96 7. DSP BlackRock Tax Saver Fund 8. Reliance Tax Saver (ELSS) Fund 9. Religare Tax Plan 10. Birla Sun Life Tax Plan
Invest in Best Performing 2016 Tax Saver Mutual Funds Online For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call --------------------------------------------- Leave your comment with mail ID and we will answer them OR You can write to us at PrajnaCapital [at] Gmail [dot] Com OR Leave a missed Call on 94 8300 8300 ----------------------------------------------- |
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