gah asked, What is the date for filing return this year?
answers, The last date of filing return is 31st July, 2008
sanjiv asked, Dear Sir, I am living in a house owned by my mother and paying rent to her. If i will buy a house in NCR (far from my office) can i claim both deduction from rent payment and interest on housing loan. thanks and regards
answers, can claim both the deductions, provided the house you own is in a different city and owning to your employment, you have migrated to another city and staying on Rent.
Ajay asked, hello my brother in us if he trnasfer funds to my account in india will it be taxable if yes what is the limit ? and also tell me it will be automatically deducted by bank once it is credited ?
answers, The transfer of funds by your brother is not your income and hence you are not required to pay any tax on the same.
vinod asked, should we declare mutual fund purchases while filing returns? what is the limuit above which we have to decalre?
answers, If you invest more than Rs 2 lakh in one mutual fund company during the year, you should declare such investment in yoiur income tax return.
sanju asked, hi in last year i earned around 70,000 in options and loss of 10,000 in intraday, i am salary man with form16 avaliable with me, which form should i fill ?
answers, Since you have dealt in intraday transaction, the transaction will be considered as speculative in nature and hence you will have to file return in ITR-4
ram71 asked, is Sell of unlisted company equit share after 3 year capital gain
answers, Yes, profit on sale of shares of Unlisted company is also considered as Capital gain.
rajeev asked, Hello Sir, Good evening. My house is under construction and the registartions has not been done. Completion date is around July May 2009. Do i get a tax rebate for 2008-2009. I have also paid bank installemnt of rs 20 k in month of march 2008. will i get a tax refund for that ?
answers, No. you won't be getting any tax benefits this year. You can start claiming deductions only when the construction is complete and you get the possession of the same. Till that time you can accumulate the interest paid and claim 20% of it in subsequent five years.
Balkrishna asked, hi i have sold a property worth 34 lacs i repaid my homeloan of 17 lacs with this amount,what is my tax liability of this i have already invested 5 lacs in gold and another 5 lacs in stocks please guide what is my tax treatment and liability
answers, You won't be getting any deduction for the amount you repaid or investment you made. The entire profit you made on sale of property would be taxable @ 20%.
ff asked, Hi, I gone through the kidney transplant before 4 years, how do i get the tax reduction for this for current and subsequent years. I am spending around 10000 per month for medical expenses for myself and my mother (she donated her kidney to me). Plz advice me.
answers, Sorry to inform, but there is no provision in Income Tax law for claiming such medical expenditure.
prasadvytla asked, Hi ,is it acceptable in the income tax to file your returns separately,i mean to say 1)returns from agriculture income and rental income 2)income from salary separately
answers, No. Income tax Return has to be filed per person and not per income. Hence you have to file only one return with all the income included.
amit asked, Hi , I am an NRI living overseas do not have a PAN CARD...I have gifted 100000 RS to my brother-in-law...Is either of us liable for any tax...like gift tax
answers, No. neither of you need to pay any tax in India.
CCCC asked, i have taken personal loan from my employer and it was used for margin amount. i took a resale house from one person and not builder. can i claim the personal loan principal/interest under tax dedcutions for house purpose
answers, No because it will be difficult for you to show the nexus between loan taken and utilisation of the same for purchase of house.
jay asked, what is the last date for filing returns of professional and businessmen.
answers, If the professional or businessmen have to get their books of account audited under Income tax law, the last date of filing is 30th September, else it is 31st July.
JOLKUMAR asked, hi Sir, I am salaried person with no other income source, which form I need to file for AY2008-2009
answers, Since you are having only Salary income, you need to fill ITR-1
vijayakumar asked, Sir, I worked in two companies six months each during the financial year 2007-2008. There was a shortage in Tax deducted for my total income. I want to know whether I have to pay interest under section 234B and C or not?
answers, Since there was shortage in deduction of tax, you need to pay additional tax. If this additional tax exceeds Rs.5,000/-, only then you will be paying interest u/s 234B & 234C.
VANITA asked, my sister died all alone . she had no family. we are three sisters alive and we got her bank balances and gratuity etc. equally shared amoung three of us. Will the amount so received by us during the year are TAXABLE?
answers, This amount won't be taxable.
Ramesh S asked, I have my tax deducted from my salary, but my employer has not paid the tax though he has mentioned it on the salary slip. Let me know if I would face any problems in future.
answers, Of course you would be facing problem Since your employer has not paid the tax deducted from your salary, Department will not be in a position to give you credit for the amount of TDS claimed and hence you will be asked to pay additional tax alongwith interest.
RKM asked, I have not files my returns last year...Can i file it this year along with my current years returns...Will i also need to pay any penalty
answers, Yes you can file your last years return alongwith current years income tax return. The Income Tax Officer may, if he wants levy a penalty of Rs.5000/- for such late filing.
Tuikin asked, Hi Vikas, Whether the interest paid on loan from an individual for purchasing House can be tax exempted?
answers, Yes, you can claim deduciton on account of interest paid for loan taken for purchase of house, even though such loan is taken from an individual.
Bharat asked, I had taken the home loan of 12.5 lacs , & want to take a car loan of about 4 lacs, can I show the EMI for car loan in IT return in any form like any loss?
answers, No you cannot do so. Interest paid on car loan is not a deductible expenses and hence cannot claim loss.
VANITA asked, I have a PAN no. but having a PAn Card. Can i get one without cancelling my existing PAN No.
answers, Don't get your PAN cancelled. YOu can get a new PAN card with current PAN also. Just fill up Request for PAN card form and submit to the relevant authorities and you will get your PAN card.
biju asked, I am an NRI. Can I gift money to my wife? How can I do it officially so that neither of us has to pay tax for it (my income is already tax deducted abroad)?
answers, Gift received by a wife from her husband is not taxed in India.
Ramani asked, Sir, Good evening. If flat in Mumbai is given on L/L for say 10000 pm .The society ischarging 1000 pm the property tax is 4000 pa, maintenance is 900 pm. What is the amount on which IT is to be paid. thank you
answers, From the a
Ramani asked, Sir, Good evening. If flat in Mumbai is given on L/L for say 10000 pm .The society ischarging 1000 pm the property tax is 4000 pa, maintenance is 900 pm. What is the amount on which IT is to be paid. thank you
answers, From the amount of rent you receive, you can deduct the amount of Property tax. From this residual income you get standard deduciton @ 30% and balance amount will be taxable.
panigrahisp asked, please confirm whether i have to pay any tax for the earning of dividend from mutual fund!
answers, No. Dividend from Mutual fund is tax-free.
jkashish asked, Last year my mother have earned 120000 as short term capital gain, Do she need to file return?
answers, If your mother is not having any otner income besides this earning, she is not required to file income tax return as the income is within the exemption limit.
ashok asked, I am selling my small flat in Delhi and I have capital gain of 5 lakhs. I taken loan three years back for a flat in bombay. Can i use this money to repay my loan.
answers, You can use this money to repay your loan. However you won't be getting any tax benefit for such repayment.
Pankajjgarg asked, Sir, whether exemption in repayment of education loan is available on both principal and interest. plz clarify
answers, For Education loan, you get deduction only for the interest component you pay during the year.
Nitn asked, Can We Claim Exemption On HRA If rent is paid to Relaitives or Family Members
answers, You can claim exemption, provided the person to whom you are paying rent is the owner of the flat.
Ravi asked, my basic is 20000 my rent is 12000 my HRA limit is 15000 how much i am taxable?
answers, Assuming that you are staying in Metro cities, Out of Rs.15,000/- HRA, an amount of Rs.5000/- will be taxable in your hands.
shekhar asked, I have give a flat on rent for which the rent is 2Lac Annually,the interest on housing loan paid is Rs 240000. can i carry forward the excess loss of 40000 on hosing property agianst my salary income .
answers, You can adjust such loss against your salary income and if at all the loss remain unadjusted, you can carry forward the same to succeding years and claim set-off.
The following are 17 important items of income, which are fully exempt from income tax and which a resident individual Indian assessee can use with profit for the purpose of tax planning.
1. Agricultural income
Under the provisions of Section 10(1) of the Income Tax Act, agricultural income is fully exempt from income tax.
However, for individuals or HUFs when agricultural income is in excess of Rs 5,000, it is aggregated with the total income for the purposes of computing tax on the total income in a manner which results into "no" tax on agricultural income but an increased income tax on the other income.
Agricultural income which fulfils the above conditions is completely exempt from tax. The manner of calculating tax on total income and agricultural income, is explained in the following illustration:
Illustration For FY 2008-09 (assessment year 2009-10), a male individual has a total income from trading in textiles amounting to Rs 1,52,000; besides, he has earned Rs 40,000 as income from agriculture. The income tax payable by him will be computed as under:
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2. Receipts from Hindu Undivided Family (HUF)
Any sum received by an individual as a member of a Hindu Undivided Family, where the said sum has been paid out of the income of the family, or, in the case of an impartible estate, where such sum has been paid out of the income of the estate belonging to the family, is completely exempt from income tax in the hands of an individual member of the family under Section 10(2).
3. Share from a partnership firm
Under the provisions of Section 10(2A), in the case of a person being a partner of a firm which is separately assessed as such, his share in the total income of the firm is completely exempt from income tax since AY 1993-94.
For this purpose, the share of a partner in the total income of a firm separately assessed as such would be an amount which bears to the total income of the firm the same share as the amount of the share in the profits of the firm in accordance with the partnership deed bears to such profits.
4. Allowance for foreign service
Any allowances or perquisites paid or allowed as such outside India by the Government to a citizen of India, rendering service outside India, are completely exempt from tax under Section 10(7). This provision can be taken advantage of by the citizens of India who are in government service so that they can accumulate tax-free perquisites and allowances received outside India.
5. Gratuities
Under the provisions of Section 10(10) of the IT Act, any death-cum-retirement gratuity of a government servant is completely exempt from income tax. However, in respect of private sector employees gratuity received on retirement or on becoming incapacitated or on termination or any gratuity received by his widow, children or dependants on his death is exempt subject to certain conditions.
The maximum amount of exemption is Rs. 3,50,000;. Of course, this is further subject to certain other limits like the one half-month's salary for each year of completed service, calculated on the basis of average salary for the 10 months immediately preceding the year in which the gratuity is paid or 20 months' salary as calculated. Thus, the least of these items is exempt from income tax under Section 10(10).
6. Commutation of pension
The entire amount of any payment in commutation of pension by a government servant or any payment in commutation of pension from LIC [Get Quote] pension fund is exempt from income tax under Section 10(10A) of IT Act.
However, in respect of private sector employees, only the following amount of commuted pension is exempt, namely: (a) Where the employee received any gratuity, the commuted value of one-third of the pension which he is normally entitled to receive; and (b) In any other case, the commuted value of half of such pension.
It may be noted here that the monthly pension receivable by a pensioner is liable to full income tax like any other item of salary or income and no standard deduction is now available in respect of pension received by a tax payer.
7. Leave salary of central government employees
Under Section 10(10AA) the maximum amount receivable by the employees of central government as cash equivalent to the leave salary in respect of earned leave at their credit upto 10 months' leave at the time of their retirement, whether on superannuation or otherwise, would be Rs. 3,00,000.
8. Voluntary retirement or separation payment
Under the provisions of Section 10(10C), any amount received by an employee of a public sector company or of any other company or of a local authority or a statutory authority or a cooperative society or university or IIT or IIM at the time of his voluntary retirement (VR) or voluntary separation in accordance with any scheme or schemes of VR as per Rule 2BA, is completely exempt from tax. The maximum amount of money received at such VR which is so exempt is Rs. 500,000.
9. Life insurance receipts
Under Section 10(10D), any sum received under a Life Insurance Policy (LIP), including the sum allocated by way of bonus on such policy, other than u/s 80DDA or under a Keyman Insurance Policy, or under an insurance policy issued on or after 1.4.2003 in respect of which the premium payable for any of the years during the term of the policy exceeds 20 per cent of the actual capital sum assured, is fully exempt from tax.
However, all moneys received on death of the insured are fully exempt from tax Thus, generally moneys received from life insurance policies whether from the Life Insurance Corporation or any other private insurance company would be exempt from income tax.
10. Payment received from provident funds
Under the provisions of Sections 10(11), (12) and (13) any payment from a government or recognised provident fund (PF) or approved superannuation fund, or PPF is exempt from income tax.
11. Certain types of interest payment
There are certain types of interest payments which are fully exempt from income tax u/s 10 (15). These are described below:
(i) Income by way of interest, premium on redemption or other payment on such securities, bonds, annuity certificates, savings certificates, other certificates issued by the Central Government and deposits as the Central Government may, by notification in the Official Gazette, specify in this behalf.
(iia) In the case of an individual or a Hindu Undivided Family, interest on such capital investment bonds as the Central Government may, by notification in the Official Gazette, specify in this behalf (i.e. 7 Capital Investment Bonds);
(iib) In the case of an individual or a Hindu Undivided Family, interest on such Relief Bonds as the Central Government may, by notification in the Official Gazette, specify in this behalf (i.e., 9 per cent or 8.5 per cent or 8 per cent or 7 per cent Relief Bonds); (iid) Interest on NRI bonds;
(iiia) Interest on securities held by the issue department of the Central Bank of Ceylon constituted under the Ceylon Monetary Law Act, 1949;
(iiib) Interest payable to any bank incorporated in a country outside India and authorised to perform central banking functions in that country on any deposits made by it, with the approval of the Reserve Bank of India [Get Quote] or with any scheduled bank;
(iv) Certain interest payable by Government or a local authority on moneys borrowed by it, including hedging charges on currency fluctuation (from the AY 2000-2001), etc.;
(v) Interest on Gold Deposit Bonds;
(vi) Interest on certain deposits are: Bhopal Gas victims;
(vii) Interest on bonds of local authorities as notified,
(viii) Interest on 6.5 per cent Savings Bonds [Exempt] issued by the RBI, and
(ix) Stipulated new tax free bonds to be notified from time to time.
12. Scholarship and awards, etc
Any kind of scholarship granted to meet the cost of education is exempt from tax under Section 10(16). Similarly, certain awards and rewards, etc. are completely exempt from tax under Section 10(17A), for example, Lakhotia Puraskar of Rs 100,000 awarded to the best Rajasthani author, every year under Notification No. 199/28/95-IT (A-I) dated 22-4-1996.
Any daily allowance received by a Member of Parliament or by an MLA or any member of any Committee of Parliament or State legislature is also exempt from tax under Section 10(17).
13. Gallantry awards, etc. -- Section 10(18)
The Finance Act, 1999 has, with effect from AY 2000-2001, provided for complete exemption for the pension and family pension of Gallantry Award Winners like Paramvir Chakra, Mahavir Chakra, and Vir Chakra and also other Gallantry Award winners notified by the Central Government.
14. Dividends on shares and units -- Section 10(34) & (35)
With effect from the Assessment Year 2004-05, the dividend income and income of units of mutual funds received by the assessee completely exempt from income tax.
15. Long-term capital gains of transfer of securities -- Section 10(38)
With effect from FY 2004-05, any income arising to a taxpayer on account of sale of long-term capital asset being securities is completely outside the purview of tax liability especially when the transaction has been subjected to Securities Transaction Tax (STT).
Thus, if the shares of any company listed in the stock exchange are sold after holding it for a minimum period of one year then there will be no liability to payment of capital gains. This provision would even apply for the old shares which are held by an assessee and are sold after the Finance (No.2) Act, 2004 came into force.
16. Amount received by way of gift, etc -- Section 10(39)
As per the Finance (No. 2) Act, 2004, gift, etc. received after 1-9-2004 by an individual or an HUF whether in cash or by way of credit, etc. is being subjected to tax if the same is not received from a stipulated relative. Section 10(39) provides that the amount received to the extent of Rs 50,000 will, however, be exempt from the purview of tax payment.
Similarly, amount received on the occasion of marriage from non-relatives, etc. would also be exempted. It may be noted that the gift from relatives, as specified in the section can be received without any upper limit.
17. Tax exemption regarding reverse mortgage scheme -- sections 2(47) and 47(x)
Any transfer of a capital asset in a transaction of reverse mortgage for senior citizens under a scheme made and notified by the Central Government would not be regarded as a transfer and therefore would not attract capital gains tax. The loan amount would also be exempt from tax. These amendments by the Finance Bill, 2008 apply from FY 2007-08 onwards.
