In my previous post on NRI's and TDS on sale of property we discussed basics of TDS on Property Sale by NRI. In this post we will understand how my NRI friends can lower the TDS on Property Sale. Before you decide to go ahead with property sale following 2 points should be considered 1. Type of Capital Gain from Property Sale i.e. Short Term Capital Gain or Long Term Capital Gain 2. Whether i am willing to pay capital gain tax or would like to save capital gain tax by Re-investment of capital gains Once these 2 points are clear then we are ready for property sale in India. Let's discuss the ... Read More
NRI’s and TDS on Sale of Property
Taxation on Sale of Property by NRI's (Non Resident Indians) is bit confusing subject. This confusion is caused due to lack of information and improper explanation. Sometimes it is in the interest of few professionals to complicate things and confuse NRI clients to maximize their gains. In most of the cases, i observed that neither buyer nor NRI seller are aware of what to do. Let me admit that Income Tax Act is not that complicated but it is in the hands of people who interpret it to make it complicated or simplified. To start with, Selling of property by NRI is taxable under u/s 195 of the ... Read More
Tax Benefits on HRA – House Rent Allowance
Current financial year is coming to an end and its a right time to discuss various Income Tax exemptions and deductions to minimize tax outflow. One such exemption is House Rent Allowance or more popularly known as HRA. HRA is a salary component received by an employee from the employer. HRA is included in salary so that employee can take care of cost towards renting an accommodation. HRA is exempted from Income Tax under section 10(13A) of the Income tax Act, 1961 and Rule 2 of Income Tax Rules. In this post, besides discussing basics of HRA we will also discuss some not so known facts about ... Read More
How to calculate Income from House Property
Income from House Property is clubbed with the total income while filing Income Tax Return. One of the most common query i received is on how to calculate income from House Property. Income from House Property arises when you have a property which is Let out Property i.e. you receive Rental Income from such property. Though this head is titled as Income from House Property but it is not necessary that you only gain income from House property. In case of Home Loan, Income from House Property can be negative i.e. you may incur Loss from Let out property when Home Loan Interest outflow outweigh ... Read More
Tax Saving FD
Tax Saving FD (Fixed Deposit) is another popular tax saving scheme for risk averse investors. As financial year is coming to an end and its time for income tax investments therefore based on request from my readers i am writing posts related to income tax savings schemes. This article on Tax Saving FD is third in series as i received 3rd highest queries on this particular tax saving scheme. Prime facie Tax Saving FD looks very lucrative investment option to save Income tax under section 80C but we have to take 360 degree approach. The biggest advantage of Tax Saving FD is its maturity ... Read More
Invest Smartly in Equity Linked Saving Schemes (ELSS)
ELSS or Equity Linked Saving Schemes is one of my favorite Tax Savings Instrument. ELSS is a type of Equity Mutual Fund in which you will get Tax benefits under Section 80C of Income Tax Act. ELSS has shortest lock-in period of just 3 years among all the Tax Saving Schemes. Like other Equity Mutual Funds, ELSS also invest in Stock Market specially in Equity segment. It's a high risk investment because of equity exposure & returns are not fixed like other tax saving schemes. You can invest any amount in ELSS but tax benefit under section 80C can be availed for max amount of Rs 1,00,000 ... Read More