Friday, December 30, 2011

INCOME TAX RATES 2011-12 EXEMPTION DEDUCTION TAX CALCULATION INCOME TAX READY RECKONER FREE - SIMPLE TAX INDIA


SMALL FREE INCOME TAX READY RECKONER 2011-12INCOME TAX RATES 2011-12 FY ,INCOME TAX RATES 2012-13 AY, INCOME TAX DEDUCTION AT A GLANCE 80C TO 80U , CAPITAL GAIN EXEMPTION AT A GLANCE 54 ,54B, 54EC,54F,SET OFF AND CARRY FORWARD LOSSES, DUE DATES , CHALLAN FORM ,OTHER TAX RELATED INFORMATION RELATED TO FINANCIAL YEAR 2011-12, INCOME TAX SLAB RATES , INCOME TAX CALCULATION , INCOME TAX READY RECKONER 2011-12

Monday, October 31, 2011

DUE DATE QUARTERLY E-TDS RETURNS CHANGED


Income Tax department has changed the date for filing of quarterly E TDS return vide notification 57/2011 dated 24.10.2011.In this notification due date to filing etds returns has been extended by 15 days for first three quarters of the Financial year but remains the same for last quarter ending 31st March.After this amendment deductors have more time to file quarterly etds return. After compulsory e filing and filing 100% pan of the deductee ,deductor needs more time to take necessary actions to fulfill these requirements so in view of these mandatory requirements.These amendment is applicable form 01.11.2011 so applicable form 3rd quarter of Fy 2011-12.This amendment is applicable only for Govt offices.

Due date ETDS return 24Q, 26Q 27Q and Form16 ,Form 16A
Sl. No.
Quarter ending
From 01.11.2011 on wards For Govt offices 
For other deductors
Etds return
Form 16A
Etds return
Form 16A
1
30th June
31st July
15th August
15th July
30th July
2
30th September
31st October
15th November
15th October
30th October
3
31st December
31st January
15th Feburary
15th January
30th January
4
31st March
15th May
30th May        (31st May for form 16)
15th May
30th May        (31st May for form 16)


Note:This notification relates to etds returns covered under rule 31A means for quarterly returns 24Q(salary) 26Q(section 193 to 196D except entries covered in 27Q) and 27Q .As the rule 31AA has not been amended so TCS(form 27EQ) return due dates remains unchanged unless notified later.Form 16A is to be issued within 15days from the due date of etds return accordingly now 15 days more available for issuance of form 16A also.


Full notification is given below.
[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II,
SECTION 3, SUB-SECTION (ii)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
Notification
New Delhi, the 24th October, 2011
INCOME-TAX
S.O. 2429 (E).‐ In exercise of the powers conferred by section 295 of the Income‐tax Act,1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income‐tax Rules, 1962, namely:‐
1. (1) These rules may be called the Income‐tax (Eighth Amendment) Rules, 2011.
(2) They shall come into force on the 1st day of November, 2011.
2. In the Income-tax Rules, 1962, –
(A) in rule 31A –
(a)
for sub-rule (2), the following sub-rule shall be substituted, namely:-
“(2) Statements referred to in sub-rule (1) for the quarter of the financial year ending with the date specified in column (2) of the Table below shall be furnished by –
(i) the due date specified in the corresponding entry in column (3) of the said Table, if the deductor is an office of Government; and
(ii) the due date specified in the corresponding entry in column (4) of the said Table, if the deductor is a person other than the person referred to in clause (i).

(b)
in sub-rule (4), after clause (vi),the following clause shall be inserted, namely:-
“(vii) furnish particulars of amount paid or credited on which tax was not deducted in view of the furnishing of declaration under sub-section (1) or sub-section (1A) or sub-section (IC) of section 197A by the payee.”
(B) in rule 37BA, in sub-rule (2), for clause (i), the following clause shall be substituted, namely:-
“(i) where under any provisions of the Act, the whole or any part of the income on which tax has been deducted at source is assessable in the hands of a person other than the deductee, credit for the whole or any part of the tax deducted at source, as the case may be, shall be given to the other person and not to the deductee:
Provided that the deductee files a declaration with the deductor and the deductor reports the tax deduction in the name of the other person in the information relating to deduction of tax referred to in sub-rule (1).”
[Notification No. 57 /2011/F. No.142/23/2011-SO(TPL)]
(RAJESH KUMAR BHOOT,)
Director (Tax Policy and Legislation)
Note:- The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (ii), vide number S.O. 969(E), dated the 26th March, 1962 and last amended by the Income-tax (7th Amendment) Rules, 2011 vide number S.O.2394(E), dated the 17th October, 2011

Due date Form 16A TDS certificate changed


Income Tax department has changed the date for filing of quarterly E TDS return vide notification 57/2011 dated 24.10.2011.In this notification due date to filing etds returns has been extended by 15 days for first three quarters of the Financial year but remains the same for last quarter ending 31st March.As per Rule 31 Form 16 is to be issued within 15 days from the due date to file quarterly return .So due to change in due date of quarterly return filing date ,due date to issued form 16A has also be changed .Form 16(salary ) remains unchanged as Form 16 is annual form and quarterly return due date for last quarter remains unchanged.After this amendment deductors have more time to file quarterly etds return and to issue form 16A . These amendment is applicable form 01.11.2011 so applicable form 3rd quarter of Fy 2011-12.This amendment is applicable only for Govt offices.


Due date ETDS return 24Q, 26Q 27Q and Form16 ,Form 16A
Sl. No.
Quarter ending
From 01.11.2011 on wards For Govt offices 
For other offices
Etds return
Form 16A
Etds return
Form 16A
1
30th June
31st July
15th August
15th July
30th July
2
30th September
31st October
15th November
15th October
30th October
3
31st December
31st January
15th Feburary
15th January
30th January
4
31st March
15th May
30th May        (31st May for form 16)
15th May
30th May        (31st May for form 16)


Note:This notification relates to etds returns covered under rule 31A means for quarterly returns 24Q(salary) 26Q(section 193 to 196D except entries covered in 27Q) and 27Q .As the rule 31AA has not been amended so TCS(form 27EQ) return due dates remains unchanged unless notified later.Form 16A is to be issued within 15days from the due date of etds return accordingly now 15 days more available for issuance of form 16A also.

Friday, October 28, 2011

INTEREST RATE CHART ON NSC ACCRUED INTEREST


Where a certificate has been purchased on or after the 1st day of March, 2003, the amount inclusive of interest, payable on encashment of the certificate at any time after the expiry of its maturity period shall be Rs. 160.10 for denomination of Rs. 100 and at proportionate rate for any other denomination. The interest as specified in the Table below shall accrue to the holder or holders of the certificate at the end of each year and the interest so accrued at the end of each year upto the end of the fifth year shall be deemed to have been reinvested on behalf of the holder and aggregated with the amount of face value of the certificate

Table
The year for which interest accrues
Amount of interest (Rs.) accruing on certificate of Rs. 100 denomination
First year
Second year
Third year
Fourth year
Fifth year
Sixth year
8.16
8.83
9.55
10.33
11.17
12.08
Note:-: The amount of interest accruing on a certificate of any other denomination shall be proportionate to the amount specified in the Table above.
 Premature encashment:-

(1) Notwithstanding anything contained in rule 15 and subject to sub-rules (2), (3) and (4), a certificate may be prematurely encashed in any of the following circumstances, namely:—

(a) on the death of the holder or any of the holders in case of joint holders;
(b) on forfeiture by a pledgee being a Gazetted Government Officer when the pledge is in conformity with these rules; or
(c) when ordered by a court of law.
(2) If a certificate is encashed under sub-rule (1) within a period of one year from the date of the certificate, only the face value of the certificate shall be payable.

(3) If a certificate is encashed under sub-rule (1) after expiry of one year but before the expiry of three years from the date of certificate, the encashment shall be at a discount. On encashment of the certificate, an amount equivalent to the face value of the certificate together with simple interest shall be payable. Such simple interest shall be calculated on the face value at the rate applicable from time totime to single accounts under the Post Office Savings Account Rules, 1981, for the complete months for which the certificate has been held. The difference between the aforesaid simple interest and the interest accruing under rule 15 shall be deemed to be the discount.

INTEREST ON NSC,KVP AND POST OFFICE TIME DEPOSIT AFTER COMPLETION PERIOD


Interest on NSC(National saving certificate ) ,KVP(kissan Vikas patra) ,Post office Time deposit after maturity period is allowed only up to 2 years .accounts closed after 2 years bears no interest but now amendment has been made in the rules and interest has been allowed up to date of closer of the account /withdrawal of the money without any time limit .Interest is allowed subject to conditions given below.
  • (a) The interest shall be simple and shall be calculated at the rate applicable from time to time to savings accounts of the type of single or joint account,
  • (b) For the purpose of payment of interest, any part of the period which is less than one month shall be ignored,
  • (c) The interest shall be paid to the depositor in lump sum at the time of repayment of amount due.
Notification in this regard has been given below.

NATIONAL SAVINGS CERTIFICATES (VIII ISSUE) AMENDMENT RULES, 2011 - AMENDMENT IN RULE 15A
NOTIFICATION NO.G.S.R. 744(E), DATED 4-10-2011

In exercise of the powers conferred by Section 12 of the Government Savings Certificates Act, 1959 (46 of 1959), the Central Government hereby makes the following rules further to amend the National Savings Certificates (VIII Issue) Rules, 1989, namely:-
1. (1) These rules may be called the National Savings Certificates (VIII Issue) Amendment Rules, 2011.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the National Saving Certificates (VII Issue) Rules, 1989, in rule 15A, the words "for a maximum period of two years" shall be omitted.

KISAN VIKAS PATRA (AMENDMENT) RULES, 2011 - AMENDMENT IN RULE 13A
NOTIFICATION NO.G.S.R. 743(E), DATED 4-10-2011

In exercise of the powers conferred by section 12 of the Government Savings Certificates Act, 1959 (46 of 1959), the Central Government hereby makes the following rules further to amend the Kisan Vikas Patra Rules, 1988, namely :—
1. (1) These rules may be called the Kisan Vikas Patra (Amendment) Rules, 2011.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Kisan Vikas Patra Rules, 1988, in rule 13A, the words "for a maximum period of two years" shall be omitted.

POST OFFICE TIME DEPOSIT (AMENDMENT) RULES, 2011 - AMENDMENT IN RULE 9
NOTIFICATION NO.G.S.R. 742(E), DATED 4-10-2011

In exercise of the powers conferred by section 15 of the Government Savings Banks Act, 1873 (5 of 1873), the Central Government hereby makes the following rules further to amend the Post Office Time Deposit Rules, 1981, namely :—
1. (1) These rules may be called the Post Office Time Deposit (Amendment) Rules, 2011.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Post Office Time Deposit Rules, 1981, in rule 9, the words "for a maximum period of two years" shall be omitted.

POST OFFICE RECURRING DEPOSIT ACCOUNT AMENDMENT


This amendment is applicable to allow simple interest rate on Post office Recurring deposit account after completion of maturity period and in case of default in deposit the installments. Earlier interest beyond maturity period is not payable if person if failed to withdraw the amount but now simple interest is allowed as applicable in case of post office saving account from time to time from date of maturity to final closure of the account.. 

POST OFFICE RECURRING DEPOSIT (AMENDMENT) RULES, 2011 - AMENDMENT IN RULES 6, 9, 9A AND 11
NOTIFICATION NO.G.S.R. 740(E), DATED 4-10-2011

In exercise of the powers conferred by section 15 of the Government Savings Banks Act, 1873 (5 of 1873), the Central Government hereby makes the following rules further to amend the Post Office Recurring Deposit Rules, 1981, namely:—
1. (1) These rules may be called the Post Office Recurring Deposit (Amendment) Rules, 2011.
(2) They shall come into force on the date of their publication in the Official Gazette.

2. In the Post Office Recurring Deposit Rules, 1981,—
(A) in rule 6, for sub-rule (3), the following sub-rule shall be substituted, namely:—

"(3) The first monthly deposit shall be made at the time of opening the account and the amount of such deposit shall be the denomination of the account. Each subsequent monthly deposit shall be made up to 15th day of the month in respect of accounts opened between 1st day and 15th day of a calendar month and up to end of the calendar month in respect of accounts opened between 16th day and last day of the month and shall be equal to the first deposit.";

(B) in rule 9, in sub-rule (2), after clause (b), the following new clause shall be inserted, namely :
"(c) Where an account has become discontinued or where the defaults in monthly deposit in an account have not been rectified during its maturity period or maturity period as extended under sub-rule (1) of rule 7 and the depositor has retained the amount in the account beyond maturity period, the depositor shall be entitled to a simple interest at the rate applicable from time to time to post office savings accounts on the deposited amount from the date of maturity till the date of closure of the account.";

(C) in rule 9A, for the words "interest at the rate applicable", the words "simple interest at the rate applicable", shall be substituted;

(D) in rule 11, after sub-rule (3) the following sub-rule shall be inserted, namely:—

"(4) Notwithstanding anything contained in the foregoing rules, if sixty monthly deposits have been made in an account during its maturity period or maturity periods as extended under sub-rule (1) of rule 7 and the depositor has retained the amount in the account beyond the maturity period, the depositor shall be entitled to a simple interest at the rate applicable from time to time to post office savings accounts on the deposited amount from the date of maturity till the date of closure of the account."

Tuesday, October 25, 2011

Repo and Reverse Repo rates increased Saving bank Interest deregulated


1. RBI has increased Repo and Reverse Repo rates by 25 bps in the credit policy.

2. Besides that, RBI has also deregulated interest rates on Savings bank accounts. Currently, banks pay interest rate of 4% on the savings bank accounts. Post this deregulation, the interest rates on Savings bank accounts bound to move up. This can have quite serious implications on the profitability of the banking system. We have attempted to summarize in this report the underlying implications with this deregulation of interest rates on Savings bank accounts.

3. By 31st March 2011, the total savings bank balance in the entire banking system is to the tune of Rs 14,46,900 Crores.

4. After this deregulation, there are various views regarding by how much the interest rates on the savings rate will move up. There are diverse views regarding by how much the interest rates on the savings account can move up, ranging from 0.25% to 2% rise. This report is made assuming that over a period of time, the interest rates on the savings bank account will rise by 1%.

5. If the interest rates on savings account move up by 1%, then the additional interest that all the banks put together needs to pay about Rs 14,469 Crores.

6. The total Profit Before Tax for the Finanical year 2010-11 of all the banks put together is to the tune of about Rs 1,12,612 Crores.

7. Hence, the additional interest that banks need to pay on savings bank will reduce the profitability of all the banking sector by 12.85%. That's quite a significant reduction. Hence, in short term, it can be said that the deregulation of interests rates on Savings bank accounts is a real game changer.

8. Assuming a 1% hike in the Savings bank accounts, the impact of this deregulation on interest rates can be quite serious on the banks such as Bank of Maharashtra (where profits can fall by 52%), DCB (by 37%), United Bank (by 35%), Dhanlaxmi Bank (34%), SBI (by 21%), etc.

9. To handle this scenario, there is a good chance that going forward, banks will focus on garnering Current bank accounts.

10. Already banks are under pressure with slow growth in the loan books and high interest rate cycle. In that backdrop, this deregulation on savings bank accounts will be a new bullet to bite for the banking system.

11. While this deregulation of savings bank accounts is surely a Diwali gift for general public and bank customers, this surely is one more body blow for the banking system to handle.
A report by SMC  Globel

Monday, October 24, 2011

NEW PAN APPLICATION FORM 49A AND 49AA WEF 01.11.11


Happy Diwali To all.
Income Tax department has notified new PAN application form. New form is applicable from 01.11.2011. Now there will two set of Form.

  1. First is Form 49A to be used by Indian Citizen ,HUF,Companies ,firm, AOP, BOI, LLP ,Trusts registered in India 
  2. Second 49AA is to be used by person not a Indian Citizen and Companies,Firms,LLP,BOI,AOP,trust  not registered in India 
Further a New reason to obtain the Pan form has been added ie  in the case of a person who is entitled to receive any sum or income or amount , on which tax is deductible under Chapter XVII-B in any financial year, before the end of such financial year."

There is no more significant changes in new forms except few minor changes.


INSTRUCTIONS FOR FILLING FORM 49A

  1. Form to be filled legibly in BLOCK LETTERS and preferably in BLACK INK.
  2. Each box, wherever provided, should contain only one character (alphabet /number /punctuation sign) leaving a blank box after each word.
  3. Individual' applicants should affix two recent colour photographs (size 3.5 cm x 2.5 cm) in the space provided on the form. The photographs should not be stapled or clipped to the form.The clarity of image on PAN card will depend on the quality and clarity of photograph affixed on the form.
  4. Signature / Left hand thumb impression should be provided across the photo affixed on the left side of the form.
  5. Signature /Left hand thumb impression should be within the box provided on the right side of the form. The signature should not be on the photograph affixed on right side of the form. If there is any mark on this photograph such that it hinders the clear visibility of the face of the applicant, the application will not be accepted. 
  6. Thumb impression, if used, should be attested by a Magistrate or a Notary Public or a Gazetted Officer under official seal and stamp. 
  7. AO code (Area Code, AO Type, Range Code and AO Number) must be filled up by the applicant. These details can be obtained from the Income Tax Office or TIN Facilitation Centre (TIN‐FC) may assist in doing so. 
  8. Applicant can also search for AO details on www.tin‐nsdl.com

GENERAL INFORMATION FOR PAN APPLICANTS

  1. Applicants may obtain the application form for PAN (Form 49A) from TIN‐Facilitation Centres (TIN‐FCs) / PAN Centres, any other stationery vendor providing such forms or download from the TIN website (www.tin‐nsdl.com).
  2. The fee for processing PAN application is Rs. 85/‐ (plus service tax, as applicable). 
  3. Those already allotted a ten digit alphanumeric PAN shall not apply again as having or using more than one PAN is illegal. However, request for a new PAN card with the same PAN or/and Changes or Correction in PAN data can be made by filling up 'Request for New PAN Card or/and Changes or Correction in PAN Data' form available from any source mentioned in (a) above. The cost of application and processing fee is same as in the case of Form 49A.
  4. Applicant will receive an acknowledgment containing a 15–digit unique number on acceptance of this form. This acknowledgment number can be used for tracking the status of the application.
  5.  For more information / Application status enquiry – Visit us at www.tin‐nsdl.com – Call TIN Call Centre at 020‐27218080 – e‐mail us at tininfo@nsdl.co.in – 
  6. SMS NSDLPANAcknowledgement No. & send to 57575 to obtain application status.
  7. Write to: INCOME TAX PAN SERVICES UNIT (Managed by National Securities Depository Limited), 3rd Floor, Sapphire Chambers, Near Baner Telephone Exchange,Baner, Pune ‐ 411 045.

INSTRUCTIONS FOR FILLING FORM 49AA (To be used by QFIs only)
(a) Form to be filled legibly in BLOCK LETTERS and preferably in BLACK INK.
(b) Each box, wherever provided, should contain only one character (alphabet /number /punctuation sign) leaving a blank box after each word.
(c) 'Individual' applicants should affix two recent colour photographs (size 3.5 cm x 2.5 cm) in the space provided on the form. The photographs should not be stapled or clipped to the form.The clarity of image on PAN card will depend on the quality and clarity of photograph affixed on the form.
(d) Signature /Left hand thumb impression should be provided across the photo affixed on the left side of the form. 

(e) Signature /Left hand thumb impression should be within the box provided on the right side of the form. The signature should not be on the photograph affixed on right side of the form. If there is any mark on this Photograph such that it hinders the clear visibility of the face of the
applicant, the application will not be accepted.
(f) Thumb impression, if used, should be attested by a Magistrate or a Notary Public or a
Gazetted Officer under official seal and stamp.
(g) AO code (Area Code, AO Type, Range Code and AO Number) must be filled up by the
applicant. These details can be obtained from the Income Tax Office or TIN Facilitation Centre
(TIN‐FC) may assist in doing so.

Sunday, October 23, 2011

Physical Gold and Gold ETF: which is better for investment


Stock Market has lead to tendency of many to go in for much safer investments that gives a reasonable return. This is the reason for gold gaining popularity as one of the safest avenues for investment.

Gold has always held importance as a good investment proposition since the days of our ancestors. But the recent trends of daylight robbery, murders and greed for the precious yellow metal with the difficulty of storage and safety of physical gold had made gold a cumbersome proposition. In addition, fraudulent and not uniform practices followed by jewelers and difficulty in establishing the purity of gold contributed to the popularity and desirability of gold ETF’s.

Gold ETF’s or gold exchange-traded funds are instruments investing in gold of 99.5% purity. Investing and maintaining these funds just required demat account and a trading account with a registered stockbroker. Gold ETF’s are more ideal than physical gold due the following reasons:
  1. Gold ETF’s are investments in gold of 99.5% purity only. It prevents one from falling into the clutches of some jewelers that fool customers with smooth and artistic talk. This avoids chances of misplacement of trust, as only a goldsmith could find out the exact purity.
  2. Owning something virtual like gold ETF’s does away with the difficulty of storage and security experienced in possessing physical gold. The units of gold ETF’s can easily be stored in both demat and trading account without being known to the greedy, cheaters, robbers and looters. A word of caution here, you could be sure of it all when you keep your units in accounts with privacy of user name and password.
  3. Gold ETF’s are most ideal for small investors as they can be purchased in small denominations sometimes of even 1 gram or ½ a gram. So ETF’s can be bought easily in small installments regularly and increased in the virtual form. This advantage is not available when investing in physical gold.
  4. Low cost, with affordability in dealing with gold ETF’s contributes to their desirability over physical gold. These instruments are listed in exchanges; the exchange traded mechanism helping to reduce processing charges, disbursements and collection charges. Gold ETF’s also help do away with the carry charges in gold futures.
  5. The ease to convert gold ETF’s into liquid cash easily at real time prices on the stock exchange avoiding charges like commission, and unnecessary fuss over quality and price by jewelers make them a desirable investment. This makes buying and selling these units easy.
  6. Right and uniform pricing in Gold ETF’s offered no scope for price discrimination that is experienced in encasing physical gold at the jewelers. One lacking knowledge and experience in dealing in gold would do best to invest in good gold ETF’s.
  7. Gold ETF’s offer protection from the liability of taxes. The taxation system for gold ETF’s is similar to non-equity mutual funds. One only needs to pay the lower of the two, long-term capital gains tax of 10 per cent without indexation or 20 per cent with indexation on profits made.
  8. Gold GTF’s are likely to show lesser tracking errors as compared to normal funds as the creation and redemption of units are done with units of the same type. This accounts for lesser liquid cash being required and the short time interval between buying and selling of units.

However some may disagree with me and say that the psychological satisfaction of seeing and feeling physical gold in the physical form is important and gold ETF’s are a fictitious concept. It is purely a question of ones own perception, but I would strongly contest gold ETF’s if investment, safety and security is ones objective.

If you keep gold in the form of ETF, you will not have any emotional attachment towards that. You will really consider it as an investment. If you need money for buying a property or kid’s higher education you will feel free to encash it. But in the case of physical gold, we will not be prepared to sell it because we will have emotional attachment towards physical gold.

So, Gold ETFs are the better way to invest in gold.

The author is Ramalingam K, an MBA (Finance) and Certified Financial Planner. He is the Founder and Director of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in.