Tax Changes impact the common man both financially and from the compliance perspective. In these dynamic times, Tax changes are more frequent compared to the past. Moreover, it is important to overhaul the tax system as per current requirement. Another reason is to nail tax evaders who are smarter due to easy access of information. As i mentioned in my previous posts that less than 3% of India's population pay direct tax. As per my calculation, 110 mn individuals are still out of tax net. In order to bring these people in tax net, Income tax department has no other option but to follow these ... Read More
Online Income Tax filing is Now Truly Online
Online Income Tax filing is now truly online, thanks to Income Tax Department. Online Income Tax filing is mandatory if your income is more than 5 lakh during the financial year. Though the tax filing process is referred as Online Income Tax filing, but it is not truly online. Reason being, after Online Income Tax filing, the taxpayer is supposed to send signed ITR-V acknowledgement through Speed Post / Ordinary Post to CPC-Bangalore. I remember standing in a queue for 3 hours to speed post ITR-V acknowledgement. In my opinion, it is not an online Income Tax filing in the true sense. I am ... Read More
11 Least Known Allowances to Save Tax
As per Wikipedia, An Allowance is an amount of money allotted or given usually at regular intervals for a specific purpose. Allowance is given in addition to salary to meet specific requirements of salaried employee. In India, Income Tax Planning is very myopic. It is only restricted to investment, investment and investment. As i highlighted in my post, 7 Financial Mistakes You should Avoid that "FREE ADVICE" is responsible for this myopic approach towards tax planning. A tax planner should look beyond "Investments". He should provide 360 degree guide to tax payer on how to SAVE TAX. ... Read More
Pay Rent to Your Parents and Save Tax
Not many people are aware that if they are staying in their parents house then they can pay rent to their parents and save tax. I briefly covered this point in my post Tax Benefits on HRA - House Rent Allowance. Its a comprehensive topic as it involve lot of ifs and buts. As it help to save tax, it doesn't mean we can blindly follow this rule related to HRA. It require financial impact study i.e. whether paying rent to parents will actually help to save tax or not on net basis. Sometimes due to ignorance of finance team of employer, HRA exemption is rejected specially in case rent is paid to ... Read More
7 Important Points about Joint Property
The concept of "Joint Property Purchase" is being popularized by Home Loan Providers and the Govt. The objective to promote Joint Property Ownership is different for both Govt and the Home Loan Providers. State Govt's are providing incentives in stamp duty and registration charges to empower women through Joint Ownership. In many cases, i observed that Husband is willing to include Wife as a Joint Owner only to save stamp duty. Whereas from Home Loan provider perspective, they have selfish motive to safeguard their business interest which is not wrong also. Home Loan provider first push for ... Read More
Delay Property Registration to Save Tax
Do you know if you Delay Property Registration then you can also Save Tax :). At first instance it sounds very confusing and contradictory but it is true. Recently one of my client Ms. Rashmi was planning to register resale property in Ahmedabad. I asked her whether she can wait till April'15 for property registration and she told me that it is feasible. I suggested her to Delay Property Registration till April'15 and she can save tax by doing so. Any property registration during last quarter of Financial Year i.e. from Jan to Mar should be done after due diligence. Reason being we are towards ... Read More
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