It's that time of the year again. Time to get ready with your investments and taxes.
Were you prudent with your investments last year? Did they help you save tax? Or did you end up paying more than you could afford?
What investment mistakes did you make last year? Are there ways to rectify them? What investment options should you go for this year?
What should you do to bring your tax liability to the minimum level?
In an hour-long chat on rediff.com on Thursday, direct tax expert Vikas M Gandhi replied to many such readers' queries. Here is the transcript:
Vikas Gandhi says,
Balaji asked, If we invest more than 2 lakhs in mutual funds (not as a lumpsum but regularly), do we still need to file this in the Annual Information Record (AIR) while filing ITR?
Vikas Gandhi answers, at 2009-05-21 16:06:05If you are investing in a single mutual fund, then you have to disclose this while filing income tax return.
chintan asked, If I am selling a house which I just built on a site which I bought 6 years ago, am I allowed to split the sale proceeds into two heads, one for the site & another for the new house? This would enable to indicate that the profit made on selling the site is long terms capital gains while the house sale proceeds is short-term gain.
Vikas Gandhi answers, Yes, you can do so.
rajani asked, I took the hdfc unit liked plan for 60k per annum and i didn't continue paying monthly installments after two months. I submitted the first month emi recipt and mention that i will do the same for year. So in Form 16 they mention that i paid for full year. What i need to do now..
Vikas Gandhi answers, While preparing your income tax return, claim correct amount of investments, irrespective of what has been declared in Form-16. This will result in additional tax payment, which you need to pay and file your income tax return.
abhishek asked, hi, i have recvd my last year (08-09) income tax statement from income tax dept but it is not showing tax deducted by my employer but it is there is my form16. what i ve to do. is IT dept can take action against me
Vikas Gandhi answers, Department will not take any action against you. However you will not be given the credit for tax deducted as mentioned in Form-16. Since the details are not seen in the statement sent to you by the Department, it means that either your PAN has been wrongly mentioned by your employer while filing TDS return or employer has not filed TDS return itself. Contact your employer who needs to take remedial action.
nitesh asked, i have paid insurance premium my self and my wife .i claim entire deducation in my return . at the time of surreder the policy she get 50000/-rs . ind entire amount deposited in fixed deposite amount and earn interest every month . in interest income who will be lible to pay tax
Vikas Gandhi answers, You wife will have to pay tax on such income.
Ravi asked, I have to repay education loan, interest being a part of it, does interest re-payment comes under 1 Lakh investment for tax savings or is it over and above that?
Vikas Gandhi answers, You get deduction for interest paid on housing loan over and above 1 lac deduction, you claim in Sec 80C. This deduction is given u/s 80E.
rAHUL asked, We ( my wife & I) are taking a flat on loan & I am planning to avail tax benefit myself, now it is possible for wife to claim HRA as well
Vikas Gandhi answers, I assume that your wife is co-owner of the flat and hence she will not be able to claim HRA benefit.
roy asked, My company has deducted TDS from my salary on March 09. At the same time they told us to declare interest received from
bank. But then I can not declare because data was not available. I have some fixed deposit in banks and they have given the for 16A to me without deducting any tax. For salary part my tax is clear through TDS. But For the interest earned how I can show and deposit the tax?
Vikas Gandhi answers, For this you need to take help of either a Tax consultant or online return preparation site, which will help you calculate your final tax liability. taxsmile.com is one of such site which will help you preparing and filing your return.
Anil asked, Dear Sir, I have a home loan with ICICI bank from past 3 years. I am a slaried employee and I do take IT exemption for 1,50,000 on this home loan. The Interest Component I paid for 2008-2009 is Rs 2,65,097. I let out the property for which I am getting Rs 17000 rent per month. The party I let out to rent cuts TDS and pays me Rs 14,373 p.m. My query is that whether I can claim the TDS which is Rs 31524 for the assessment year while filing for the Tax returns. Thanks in advance for answering.
Vikas Gandhi answers, You have to claim credit of such TDS while preparing your income tax return. Further, since you have rented-out the property, you can claim entire amount of interest paid against the rent income and not just restrict it to Rs.1,50,000/-.
newraj asked, Hi, I have to get refund for Finecial year 2005-2006, when I was in mumbai, the check got back ( due to unavailbility) and now I am in Punjab ( shifted here) for last 2 years, where I should contact to get refund.
Vikas Gandhi answers, You will have to contact Income Tax Officer at Mumbai for issuing your refund, unless and until you have got your records transferred to Punjab.
santoshkumar asked, I am a freelancer, self employed, I work from home on a computer performing internet marketing. I get paid through paypal and gets transferred into the bank. What Form should i use for filing income tax. Do i come under business category?? Pls clarify
Vikas Gandhi answers, Your income does come under business category and hence you will have to file your income tax return in form ITR-4.
Gagan asked, Dear Sir, I have a home loan with IDBI this year. I am a slaried employee and my house is still under construction and i am going to get the posession this year itself, do i am eligible for u/s 24 interest Rs. 150,000/- and principle amount Rs. 100000/- under 80C section and apart from this do i am eligible for claiming house rent allowance this year as my house is still under construction,and suppose i get the posession in December this year shall i be eligible for house rent allowance for jan,feb and march also for this financial year
Vikas Gandhi answers, Since you will be getting possession of your house in the current year i.e F.Y.2009-2010, you will be able to claim deduction of interest as well as principal repayment. As mentioned since the possession will be received in December, you can claim HRA benefit only upto December.
s asked, sir, if there is a flat in joint name of husband and wife , EMI is paid by husband can husband and wife both can get tax deduction of interst on home loan
Vikas Gandhi answers, Although the property is jointly owned, EMI is paid only by husband. Hence tax benefit will be available only to husband and not to wife.
B asked, Hi PLEASE REPLY, For the Returns earned on MFs how much time is required for them to call as "Capital Gain" so that we dont need to pay the tax on the returns ? Also please suggest whether we need to show that investment also in each year filing of ITR ?
Vikas Gandhi answers, When you sell units of mutual fund after holding it for more than one year, they are called Long Term Capital Gain. Units are of two types - Equity oriented and Debt oriented. Long Term Capital Gain on sale of Equity oriented units of Mutual fund are only exempt from tax.
Vikas Gandhi says, That's all for this session, friends. Chat with you next week. Good-bye.
