Taxation Queries

What are taxes and charges applicable on mutual funds and returns

What are taxes and charges applicable on mutual funds and returns?

Oct 25, 2016 by Imran, Dhule | Taxation

Mutual funds are one of the most tax efficient investment options in our country. Capital appreciation in equity mutual funds held for a period of more than one year is tax free. Dividends paid by equity mutual... Read More

Will my investments in NPS qualify for tax rebate under Section 80CCD

My 80c limit is exhausted with investment over 1.5 Lakhs, I am doing additional investment in NPS on my own (personal). Can it be qualified for 80 CCD 1 (B) or does I require anything to get my NPS investment qualify for 80 CCD 1(B)?

Oct 14, 2016 by Ankit, Pimpri | Taxation

Your investment in NPS will qualify for tax rebate under section 80CCD (1B) upto an amount of Rs. 50,000. This rebate of Rs. 50,000 under section 80CCD is over and above the limit of Rs. 150,000 for Section... Read More

Is the money donated to kids taxable

If parents donate money to their kids, is this amount taxable for the kids. Is this amount seen as an income form other sources for the kids. Example - 30 Lakhs donated from mother?

Sep 27, 2016 by Ravishankar, Pune | Taxation

Money can be gifted to kids and it is not taxable either to the parents or the kids. However, the earnings received from the amount will be taxable (depending upon the investment nature and tenure) and shall be... Read More

Should I choose NPS or increase my investments in existing Mutual Fund SIPs

I am investing an amount of Rs. 30000 through different SIP (Large, Multi and Mid cap) for a targeted period of minimum 15 to maximum 21 years for achieving my various goals. Now I wish to invest an additional amount of Rs. 8000 to 10000 every months, but I am not sure that whether will I choose NPS or increase my investment in existing Mutual funds? My investment horizon is about 24 years. I am 36 years old and worked in a Govt. sector, please suggest me?

Aug 16, 2016 by A Biswas, Nashik | Taxation

You should choose NPS only if you want to avail additional tax benefit of Rs. 50,000 under section 80CCD. You may be aware that the Finance Minister announced an additional tax saving of Rs. 50,000 per year... Read More

What would be the taxation on INDIAREIT Fund

I have just received my first return on an investment that I done in a real estate investment fund (erstwhile INDIAREIT fund). This payment by the fund was a return of my capital plus LTCG. I am trying to determine my income tax impact for the LTCG. Please advise if it would taxable at 20% or if it can be treated like a Debt Mutual fund and be taxed at 20% with indexation?

Aug 16, 2016 by Harish Sadasivan, Bangalore | Taxation

We find that INDIAREIT Fund has few series of schemes launched over a period of time. We do not know which one you have invested in? In the Budget 2014, the Finance Minister proposed to kick start the... Read More

What would be the tax if I invest a lump sum amount for less than 3 years in debt funds growth option

I want to know if I invest a lump sum amount less than 3 years on debt / growth oriented scheme maturity value taxable on the hands of investor? if so, at what percentage?

Aug 16, 2016 by Biswaranjan Das, | Taxation

Thanks for writing to us. We have received and replied to many similar queries to many visitors on our website. Request you to go through the following which we are sure will reply your query fully... Read More

What is the tax on redemption of capital protection fund and the Cost Inflation Index

My investment in a Capital Protection fund just matured after completing 3+ years and I am trying to determine the income tax liability for long term capital gains. From reading your past blogs, I understand that long term capital gains are taxed @20% with indexation. So, please advise how I can obtain the cost inflation index for the year of purchase (2013) and year of maturity (2016)?

Aug 4, 2016 by Harish Sadasivan, Bangalore | Taxation

You are right. The long term capital gains tax on debt funds (if units are held for more than three years) is applicable @20% with indexation + 15% surcharge + 3% Cess = Total 23.69%... Read More

Will gift tax apply if I transfer fifty thousand to my in laws account

I want to give fifty thousand in in-law's account who does not file return, whether it has any tax implications on both of us?

Aug 3, 2016 by Basudev, Barbil | Taxation

There is no tax to be paid (either by you or your in-laws) in case the gift amount is upto Rs. 50,000 in a year... Read More

If I have to invest Rs one lakh in debt funds what would be the taxation before and after 3 years

If I have invested Rs. 100000/- in debt fund what would be the taxation if I withdraw before three years & after three years?

Aug 3, 2016 by Dinesh Parekh, Mumbai | Taxation

Gains arising out of your investments in debt fund if held for less than 3 years will be treated as short term capital gain and more than 3 years will be treated as long term capital gains. To know exact taxation... Read More

Can we open another PPF Account for my spouse and if she is eligible to take the advantage of tax benefit

We have savings bank account in SBI i.e., either any one survivor mode of operation. The PPF account which linked to this account is in my name only & I am availing tax benefit under 80C. Can we open an another account in spouse's name. And can she is eligible to take the advantage of tax benefit?

Jul 4, 2016 by Basudev, Barbil | Taxation

Please note that if your wife is an Income Tax Assess and want to avail tax benefit under section 80C of the Income Tax Act 1961, then of course your wife can open a separate PPF account for this purpose... Read More