NRI Investment In Real Estate

I was going through this excellent article on NRI investments in real Estate and how NRIs can benefit from the investments. Maybe all the NRI friends should read this article, thats why i am linking directly to this article.

Please find it here....

P/E Ratio, Explained

We have all heard a lot about P/E ratio, Lets see a video from Investopedia about the same...

Many thanks to Investopedia....

Income Tax - Income from other Sources

My company just send me the investment declaration form, this form is used to send in investment proofs and fill in the details a predefined format. I guess most of the working class has this kind of a form, in which you have to fill in most of the information about the tax saving investments that we have done over the period of the financial year.

In this form since last year, they have added a column to declare "Income from other sources", which we saw earlier only in the ITR form. Now, i have been thinking that most of us don't even know what this means. What other sources? or Most of us just give the  information of the interest income from the bank accounts or the Fixed deposits that we have but then these are not the only heads which cover the "Income from other sources" category. 

The income tax law includes under the head "Income from other Sources" the following Categories - 

  1. Dividend income
  2. Income from winning of Lotteries, horse racing, game shows, games, gambling etc.
  3. Any sum, the aggregate of which is above Rs. 50000/- from people other than immediate family or specified categories of bodies etc. 
  4.  Income from Shares
  5. Any Amount received from Key Man Insurance Policy.  
  6. Income on letting out on hire machinery, plant or furniture. 
  7. Interest on securities, Fixed deposits, Bank deposits etc. 
So next time, when you declare your income to the employer or fill in the ITR returns form, you need to keep in mind that the above mentioned incomes need to be considered in totalling your income in one Financial year. 

Infrastructure Bonds - Tax Saving Under 80CCF

Finally decided to invest in Infrastructure bonds, have been researching in them for 1 year now. Didn't know what to do earlier, and finally today decided to take the dip.

Invested INR10000/- in IDFC Tranche 2 Long Term Infrastructure bonds. Just bought two units, but hopefully will buy more in the next financial year. Already overrun in my investment budget for this month.

I already have a post on the Infrastructure bonds and section 80CCF, you can read it here... 

Infrastructure Bonds, A new tax saving scheme

The Government of India in its Budget Proposal of 2010 introduced a new income tax saving section by investing Infrastructure bonds. This falls under the 80CCF section, which is over and above the 1 lakh limit offered under the 80C section. This basically means that you can invest an additional INR 20000 after you have already invested the one lakh that falls under the section 80C of the income tax law. Some of the main features of the section are -
  • Limit of INR 20000 that can be invested into a infrastructure bond 
  • The benefit of tax saving is available for both individuals and HUF
  • The money will have a  lock-in period of 5 years
  •  PAN No. is a must to apply for these bonds
  •  If you fall in the 30% tax bracket, you can save about INR 6000.
  • After the Lock in period of 5 years, the investor can take a loan against the bond. 
  • Tenure of the bond will be 10 Years. 
  • The interest rate offered on the bonds could be 1 to 2 per cent lower than the prevailing market rate, since the section specifies that the yield on the bond cannot be more than the yield from government securities.

My prospective on this is that if i invest INR 20000 into the bond this year, i save a tax of about INR 6000, hence making my total investment worth INR 14000. and if after 5 years i get back approx INR 26000 after tax deduction. Its not a bad investment.

Latest Income tax News from India

Find here below the latest income tax news from many sources....


Taxability of non-resident: Yet another U-turn by CBDT

Economic Times - ‎Nov 13, 2009‎
Lately, the Central Board of Direct Taxes or CBDT (which is the highest ranking executive authority for income taxes in India) has withdrawn several of its ...


Gold touches all-time high

Chandigarh Tribune - ‎Nov 7, 2009‎
Pooling of capital gains funds to buy a single property is a grey area and approval of the same would depend upon the Income Tax officer's discretion. ...


IT dept plans to make names of habitual tax defaulters public

Financial Express - ‎Nov 8, 2009‎
New Delhi: Tax defaulters beware. The income tax department is considering publishing the names of habitual tax defaulters with large tax demands pending. ...


How you can cut your tax liability

Rediff - ‎Oct 28, 2009‎
Certain investment options have been provided in the Income Tax Act, 1961, which, when exercised, can help in reducing tax liability. ...


Loan puzzle

Calcutta Telegraph - ‎Nov 1, 2009‎
So, any income from investment of the gifted amount will be clubbed with your income and you shall have to pay income tax thereon. ...