Define the term EMI


It is a short form for Equated Monthly Installment. This is the amount paid monthly by a borrower on a monthly basis to the bank or any other lender.

It basically has two components -
1. the portion of the principal amount
2. the interest portion for that month

Normally in the start of the loan repayment period the largest part of the EMI is from the interest part but as you keep paying the premium the Interest portion keeps getting paid off and the principle is the larger portion of the EMI.

I personally feel that banks do this so that in case you decide to payoff the loan earlier or as they call it foreclosure you have to pay some penalty on the principal amount and with maximum principal still remaining to be paid off the penalty also becomes very hefty.

But then thats my opinion, whats yours.

How to file Income tax returns Online

The Website of the income tax department allows to file the returns online. Its a very simple technique. Income Tax Department has introduced a convenient way to file these returns online using the Internet.

Every new user has to register at this website in order to avail the e-Filing facility. After completing the registration process and logging in, the user may download the software tools (this is and excel file) from the download section. Based on all the relevant information the required ITR Form should be filled using the software provided. The software would generate the XML format of the return which should be uploaded on this website. On successful transmission of the return a receipt will be generated in the form of a provisional acknowledgment.

If you have digital signature you can complete the submission but if not you can print the acknowledgment and send it to the tax authorities.

The web site is for individual tax returns is "ITR filing"

Video on how to fill ITR1 form part 2

It seems like the last video i posted on how to fill ITR1 form for filing income tax returns, was incomplete and i found a second video as well for the same on you tube as well. And of course i would like to thank the original publisher here too i.e.

Video on how to fill ITR1 form

I found this video on youtube which describes the filling of ITR 1 form for filing personal income tax returns. It claims on you tube "Step by step instructions that guide you about filling the Income Tax Return Form 1 - ITR1 before filing it. It's really simple".

Thanks to the original publisher of course.

Budget Highlights - 2009 -10

I really wanted to give some budget highlights on my blog for direct taxes since they impact us the most...

§ Exemption limit in personal income tax raised by Rs. 15,000 from Rs. 2.25 lakh to Rs. 2.40 lakh for senior citizens; by Rs. 10,000 from Rs. 1.80 lakh to Rs. 1.90 lakh for women tax payers; and by Rs. 10,000 from Rs. 1.50 lakh to Rs. 1.60 lakh for all other categories of individual taxpayers.

§ Deduction under section 80-DD in respect of maintenace, including medical treatment, of a dependent who is a person with severe disability being raised from the present limit of Rs. 75,000 to Rs. 100,000.

§ Surcharge on various direct taxes to be phased out; in the first instance, by eliminating the surcharge of 10 percent on personal income tax.The effective maximum marginal rate is 30.99%.

§ Sun-set clauses for deduction in respect of export profits under sections 10A and 10B of the Income Tax Act being extended by one more year i.e for the FY 2010-11.

§ Fringe Benefit Tax on the value of certain fringe benefits provided by employers to their employees to be abolished wef AY 2010-11.

§ Scope of provisions relating to weighted deduction of 150% on expenditure incurred on in house R & D to all manufacturing businesses being extended except for a small negative list.

§ Businesses to be incentivised by providing investment linked tax exemptions rather than profit linked exemptions.Investment linked tax incentives to be provided, to begin with, to the businesses of setting up and operating ‘cold chain’, warehousing facilities for storing agricultural produce and the business of laying and operating cross country natural gas or cude or petroleum oil pipeline network for distribution on common carrier principle.Under this method, all capital expenditure, other than expenditure on land, goodwill and financial instruments to be fully allowable as deduction.

§ Minimum Alternate Tax (MAT) to be increased to 15% of book profits from 10%.The period allowed to carry forward the tax credit under MAT to be extended from 7 to 10 years.

§ Commodity Transaction Tax (CTT) to be abolished wef 1.04.2009.

§ Donations to electoral trusts to be allowed as a 100% deduction in the computation of the income of the donor.

§ Deduction u/s 80E of the Income Tax Act allowed in respect of interest on loans taken for pursuing higher education in specified fields of study to be extended to cover all fields of study, including vocational studies, pursued after completion of schooling.

§ To mitigate the practical difficulties faced by chartitable organisations, anonymous donations received by charitable organisations to the extent of 5% of their total income or a sum of Rs. 1 Lakh, whichever is higher, not to be taxed.

§ Scope of presumptive taxation to be extended to all small businesses with a turnover upto Rs. 40 lakh.All such taxpayers to have option to declare their income from business at the rate of 8% of their turnover and simultaneously enjoy exemption from the compliance burden of maintaining books of accounts. As a procedural simplication, they are also to be exempted from advance tax and allowed to pay their entire tax liability from business at the time of filing their return.This new scheme to come into effect from the financial year 2010-11.

§ Tax holiday u/s 80-IB (9) of the Income Tax Act, which was hitherto available in respect of profits arising from the commercial production or refining of mineral oil, to be extended to natural gas.This tax benefit to be available to undertakings in respect of profits derived from the commercial production of mineral oil and natural gas from oil and gas blocks which are awarded under the NELP-VIII round of bidding.The section to be retrospectively amended to provide that “Undertaking” for the purposes of section 80-IB(9) will mean all blocks awarded in any single contract.

§ New Pension System (NPS) to continue to be subjected to the Exempt-Exempt-Taxed (EET) method of tax treatment of savings.Income of the NPS Trust to be exempted from income tax and any dividend paid on this Trust from Dividend Distribution Tax.All purchase and sale of equity shares and derivatives by the NPS Trust also to be exempt from Securities Transaction Tax.Self employed persons to be enabled to participate in the NPS and to avail of the tax benefits available thereto.

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