Union Finance Minister Pranab Mukherjee marginally raised the Income Tax exemption limit, abolished Fringe Benefit Tax and Commodity Transaction Tax and announced some schemes to benefit the aam aadmi.
What exactly does the Budget hold for the common man? Will you benefit from the Budget proposals? Or do you really don't care? How does it affect you?
What are the best investment oportunities open to you? How best can you save taxes?
In a chat on rediff.com, direct tax expert Vikas M Gandhi offered some valuable tips. Here is the transcript:
Vikas Gandhi says, Good evening friends and welcome back to the Tax chat session.
hhhh asked, hi, can i file my return now?
Vikas Gandhi answers, at 2009-07-30 15:19:34Certainly. You can file your income tax returns till 31st July. So hurry up and file your return.
Jule asked, I live in a rented flat and get HRA. In June 2008, I booked a house (still not ready) with a home loan. Can I claim the HRA as well as benefits from the home loan?
Vikas Gandhi answers, Since the house is under construction, you cannot claim home loan benefits. This can be available from the year you get then possession of the property. Till then enjoy the benefits of HRA exemption.
Meher asked, While filing returns, do we also need to show mutual fund dividends?
Vikas Gandhi answers, Mutual fund dividend is exempt from tax and hence does not affect your tax calculation. However you should disclose the same in the income tax return, as a separate area is provided in the income tax return.
vinoda asked, apart from 1 Lakh, can I exemption for Mediclaim under 80c and 80d, what are limits
Vikas Gandhi answers, Apart from Rs. 1 lakh deduction u/s 80C, you can additionally claim deduction for Medical insurance premium paid. The limit for claiming deduction is as under - Premium paid for self, spouse and children - Rs,15,000/- or actual premium paid, whichever is less. Premium paid for parents - Rs,15,000/- or actual premium paid, whichever is less. If parents are senior citizens, the limit of Rs. 15,000/- is extended to Rs.20,000/-
Suvam asked, I am paying LIC premiums for my father who is retired and dependent on me. Can I submit those receipts for my tax exemption?
Vikas Gandhi answers, No, you cannot. You can claim deduction for premium paid only for self, spouse and children.
Jai asked, I have a query.. i have purchased a new house. the old house would be on rent. would it be possible to show the rent on my wife name and claim deduction for the new house from my tax?
Vikas Gandhi answers, Presumably the old flat is in your name. If that is the case, any income generated from such flat will be your income and this cannot be shown as rent income of your wife.
vinoda asked, Is it mandatory to file before 31st July? Can I file after 31st July ? upto what date I can file the return?
Vikas Gandhi answers, You can certainly file your return after 31st July also. However in case your tax calculation results in additional tax liability, you will have to pay penal interest @1% per month for late filing of return. Further if there is any unadjusted loss, you won't be able to carry forward such loss to subsequent years. Further if you file your return after 31st March of next year, you can even be liable to pay penalty of Rs.5,000/-.
perminder asked, Besides my regular work, I also do some freelancing. Do I have to show it as other income?
Vikas Gandhi answers, Certainly, it is your income and you have to disclose all the income earned during the year, however small it may be.
Raman asked, I got a form16 'A' from ICICI bank for tax they deducted. Do I need to add that to my return?
Vikas Gandhi answers, Yes. ICICI bank has given you a certifiacte for the amount of tax they have deducted from the income that was credited to your account. the tax has been deducted at a concessional rate of 10%. while filing income tax return, you will have to disclose the amount mentioned in the certiifcate as income and claim tax concession for tax already deducted and paid on your behalf.
Mandar asked, If I decide to move to a rented apartment what is the maximum House Rent that I can claim is Rs.36,000p.a only ?
Vikas Gandhi answers, There is no maximum limit specified for House Rent allowance. As a gerenal rule, your HRA should be 50% of your basic salary.
vinayc asked, I just got to know that i filed my last year tax returns for the wrong assessment year. I filed them for Assessment year 2007-08 but i should have actually filed for the year for 2008-09. Please suggest what can i do now.
Vikas Gandhi answers, Refile for A.Y. 2008-09 at the earliest.
def asked, Can property tax paid for self occupied home can be shown and minus-ed against income in ITR-2.
Vikas Gandhi answers, You cannot claim any such deduction.
debasish1 asked, I have constructed a house with housing loan in my workplace, my spouse is staying in other state in rented house. She is not having any income. Can I claim both houseing loan and rent while calulating tax liability?
Vikas Gandhi answers, If both the house are in a separate state and it is difficult to travel to your self onwed house on a day-to-day basis, you can claim tax benefit for HRA as well as for home loan.
souz asked, Is profit from sale of shares to be included while filing returns? What if there is also a loss from sale of shares?
Vikas Gandhi answers, Profit from sale of shares can either be short term or long term. If the profit is short term it is taxable and hence the same should be included while filing returns. Same is the case with the loss, as the same would be either adjusted against current years profit or carried forward to next year. As far as Long term profit is concerned, although the same is exempt from tax, it is advisable to dicslose the same under Exempt Income category. As regards loss, if the net result after adjustment is loss, you can ignore the same as it cannot be carried forward.
hllo asked, On the gift I give to my wife and the income is generated on that by investing it. What will be tax implication? Will it club to my income?
Vikas Gandhi answers, The income generated will be clubbed with your income and you will be paying tax on such income.
awer asked, sir i have a home loan , but do not have a component on hra in my salary .can i claim a deduction under 24c for home leoan interest paid
Vikas Gandhi answers, You can claim Interest paid on Home Loan irrespective of the fact whether you have HRA as component of your Salary or not. Interest is cliamed under section 24(b).
wsx asked, I got house in other city bought on home loan. It is locked and no one is staying there. How much home loan interest is exempt in such case? Do I need to show fair rent even if it is not rented?
Vikas Gandhi answers, In case of self-occupied property, there is Rs.150000 cap on interest that can be claimed. In case if the property is not self-occupied, than whatever interest is paid by you can be claimed. Regarding fair rent, it needs to be disclosed only if the proerty is not claimed as Self-occupied. In your case, if you do not have any other property in your name, than you can claim the same as Self-Occupied.
Vikas Gandhi says, That's all for this session friends. Chat with you next week. Good bye.
