Sunday 24 February 2013

Going to invest before 31st March - RAJIV GANDHI EQUITY SAVINGS SCHEME is good option

MAIN PROVISIONS OF RAJIV GANDHI EQUITY SAVINGS
SCHEME
Finance Minister Mr. P Chidambaram has launched an
equity scheme called Rajiv Gandhi Equity Savings Scheme, or RGESS,
is an attempt to lure new investors to the stock market.
The main provisions of this scheme are as under:
1. The gross total income should be less than or equal to Rs. 10 lakhs.
2. Person has never invested in equities before through a Demat
account or in derivatives, then only he is eligible to invest in RGESS. It
means tax benefits are available to first-time investors in stock
market.
3. Any individual can invest up to Rs. 50000 in RGESS and can claim
the Deduction U/S 80CCG of 50% of investment amount.
4. There would be a lock-in period of three years, but Govt. has
allowed some flexibility to exit after a year of investment.
5. To be able to invest in RGESS, one need to open a Demat Account
and submit Form A, which is a declaration that an individual has never
invested in equities.
6. Individual can either buy shares of companies that are part of the
BSE 100 or National Stock Exchange (NSE) CNX 100 through a stock
broker or on your own. Or you can buy RGESS MF schemes.
7. Individual can buy Exchange Traded Funds or ETFs that are available
on the BSE or the NSE that track either the Sensex or Nifty indices.

If one has any problem regarding above or want any consultancy on above issue please feel free to contact me between 4.00PM to 6.00PM on working days

Tuesday 19 February 2013

Income Tax Calculator

Calculate your Income Tax online for any Assessment Year up to A.Y. 2013-14 through following link -

http://law.incometaxindia.gov.in/DIT/Xtras/taxcalc.aspx

or

http://finotax.com/itax/itaxcalc1.htm

Sunday 10 February 2013

Get IFSC Code, MICR Code, BSR Code and Location of all bank in INDIA through using any of following links -

http://banksifsccode.com/

http://www.ifsccodeonline.com/

Sunday 3 February 2013

Rajiv Gandhi Equity Savings Scheme

Rajiv Gandhi Equity Savings Scheme (RGESS)

Rajiv Gandhi Equity Savings Scheme (RGESS) was announced by the then Finance Minister Pranab Mukherjee in his 2012-13 budget speech. The scheme is exclusively for the first time retail investors in securities market. This Scheme would give tax benefits to new investors who invest up to Rs. 50,000 and whose annual income is below Rs. 10 lakh.

The key features of the scheme are as under:

Scheme is open to new retail investors, identified on the basis of their PAN numbers. This includes those who have opened the Demat account but have not made any transaction in equity and /or in derivatives till the date of notification of this Scheme and all those account holders other than the first account holder who wish to open a fresh account.
Those investors whose annual taxable income is upto Rs. 10 lacs are eligible under the Scheme.
The maximum Investment permissible under the Scheme is Rs. 50,000 and the investor would get a 50% deduction of the amount invested from the taxable income for that year.
Under the Scheme, those stocks listed under the BSE 100 or CNX 100, or those of public sector undertakings which are Navratnas, Maharatnas and Miniratnas would be eligible. Follow-on Public Offers (FPOs) of the above companies would also be eligible under the Scheme. IPOs of PSUs, which are getting listed in the relevant financial year and whose annual turnover is not less than Rs. 4000 cr for each of the immediate past three years, would also be eligible.
In addition, considering the requests from various stake holders, Exchange Traded Funds (ETFs) and Mutual Funds (MFs) that have RGESS eligible securities as their underlying and are listed and traded in the stock exchanges and settled through a depository mechanism have also been brought under RGESS.
To benefit the small investors, the investments are allowed to be made in installments in the year in which tax claims are made.
The total lock-in period for investments under the Scheme would be three years including an initial blanket lock-in period of one year, commencing from the date of last purchase of securities under RGESS.
After the first year, investors would be allowed to trade in the securities in furtherance of the goal of promoting an equity culture and as a provision to protect them from adverse market movements or stock specific risks as well as to give them avenues to realize profits.
Investors would, however, be required to maintain their level of investment during these two years at the amount for which they have claimed income tax benefit or at the value of the portfolio before initiating a sale transaction, whichever is less, for at least 270 days in a year. The calculation of 270 days includes those days pursuant to the day on which the market value of the residual shares /units has automatically touched the stipulated value after the date of debit.
The general principle under which trading is allowed is that whatever is the value of stocks / units sold by the investor from the RGESS portfolio, RGESS compliant securities of at least the same value are credited back into the account subsequently. However, the investor is allowed to take benefits of the appreciation of his RGESS portfolio, provided its value, as on the previous day of trading, remains above the investment for which they have claimed income tax benefit.
For the purpose of valuation of shares, the closing price as on the previous day of the date of trading will be considered so that new investors are certain about their debits and credits into the account.
In case the investor fails to meet the conditions stipulated, the tax benefit will be withdrawn.
The deduction from taxable income available under the scheme can be claimed under Section 80CCG of Income Tax Act.

Allowable Deductions from Gross Total Income

Deductions Allowable under various sections of Chapter VIA of Income Tax Act :

Section 80C (Various investments)
Section 80CCC (Premium for Annuity plans)
Section 80CCD (Contribution to Pension Account)
Section 80CCF (Investment in Infrastructure Bonds)
Section 80CCG Rajiv Gandhi Equity Saving Scheme (RGESS)
Section 80D (Medical/ Health Insurance)
Section 80DD (Rehabilitation of Handicapped Dependent Relative)

Section 80DDB (Medical Expenditure on Self or Dependent Relative)
Section 80E (Interest on Loan for Higher Studies)
Section 80G (Various Donations)
Section 80GG (House Rent Paid)
Section 80U (Employee suffering from Physical Disability)
Section 80RRB (Royalty of a Patent)
Section 80TTA (Interest on Savings Bank)

Section 80C:

This section has been introduced by the Finance Act 2005. Broadly speaking, this section provides deduction from total income in respect of various investments/ expenditures/payments in respect of which tax rebate u/s 88 was earlier available. The total deduction under this section (alongwith section 80CCC and 80CCD) is limited to Rs. 1 lakh only.

Life Insurance Premium For individual, policy must be in self or spouse's or any child's name. For HUF, it may be on life of any member of HUF.
Sum paid under contract for deferred annuity For individual, on life of self, spouse or any child .
Sum deducted from salary payable to Govt. Servant for securing deferred annuity for self-spouse or child Payment limited to 20% of salary.
Contribution made under Employee's Provident Fund Scheme.
Contribution to PPF For individual, can be in the name of self/spouse, any child & for HUF, it can be in the name of any member of the family.
Contribution by employee to a Recognised Provident Fund.
Sum deposited in 10 year/15 year account of Post Office Saving Bank
Subscription to any notified securities/notified deposits scheme. e.g. NSS
Subscription to any notified savings certificate, Unit Linked Savings certificates. e.g. NSC VIII issue.
Contribution to Unit Linked Insurance Plan of LIC Mutual Fund e.g. Dhanrakhsa 1989
Contribution to notified deposit scheme/Pension fund set up by the National Housing Scheme.
Certain payment made by way of instalment or part payment of loan taken for purchase/construction of residential house property.

Condition has been laid that in case the property is transferred before the expiry of 5 years from the end of the financial year in which possession of such property is obtained by him, the aggregate amount of deduction of income so allowed for various years shall be liable to tax in that year.
Contribution to notified annuity Plan of LIC(e.g. Jeevan Dhara) or Units of UTI/notified Mutual Fund. If in respect of such contribution, deduction u/s 80CCC has been availed of rebate u/s 88 would not be allowable.
Subscription to units of a Mutual Fund notified u/s 10(23D).
Subscription to deposit scheme of a public sector, company engaged in providing housing finance.
Subscription to equity shares/ debentures forming part of any approved eligible issue of capital made by a public company or public financial institutions.
Tuition fees paid at the time of admission or otherwise to any school, college, university or other educational institution situated within India for the purpose of full time education of any two children. Available in respect of any two children

Section 80CCC: Deduction in respect of Premium Paid for Annuity Plan of LIC or Other Insurer

Payment of premium for annuity plan of LIC or any other insurer Deduction is available upto a maximum of Rs. 100,000/-. (This limit has been increased from Rs. 10,000/- to Rs. 1,00,000/- w.e.f. 01.04.2007).

The premium must be deposited to keep in force a contract for an annuity plan of the LIC or any other insurer for receiving pension from the fund.

Note: The limit for maximum deduction available under Sections 80C, 80CCC and 80CCD (combined together) is Rs. 1,00,000/- (Rs. one lac only). An additional deduction upto a maximum of Rs. 20,000/- will be available from Assessment Year 2011-12 (FY 2010-11) for investment in Infrastructure Bonds.

Section 80CCD: Deduction in respect of Contribution to Pension Account

Deposit made by a Central government servant in his pension account to the extent of 10% of his salary. Where the Central Government makes any contribution to the pension account, deduction of such contribution to the extent of 10% of salary shall be allowed. Further, in any year where any amount is received from the pension account such amount shall be charged to tax as income of that previous year.

Section 80CCF: Investment in Long Term Infrastructure Bonds

Investments in Long Term Infrastructure Bonds issued by Industrial Finance Corporation of India, LIC, Infrastructure Development Finance Company Limited or a Non-Banking Finance Company classified as an Infrastructure Finance Company by RBI with a minimum tenure of 10 years and Lock in period of 5 years. Maximum amount of deduction available is Rs. 20,000/- The deduction is over and above the combined deduction of Rs. 100,000/- available under section 80C, 80CCC and 80DDD.

The benefits under this section were extended by one year in the Budget 2011 but the same has not been done in Budget. Therefore, the deduction under this section shall not be available for AY 2013-14.

Section 80CCG: Rajiv Gandhi Equity Saving Scheme (RGESS)

As per the Budget 2012 anouncements, a new scheme Rajiv Gandhi Equity Saving Scheme (RGESS) will be launched. Those investors whose annual income is less than Rs. 10 lakh can invest in this scheme up to Rs. 50,000 and get a deduction of 50% of the investment. So if you invest Rs. 50,000 (maximum amount eligible for income tax rebate is Rs. 50,000), you can claim a tax deduction of Rs. 25,000 (50% of Rs. 50,000). View key features of Rajiv Gandhi Equity Saving Scheme (RGESS).

Section 80D: Deduction in respect of Medical Insurance

Deduction is available upto Rs. 20,000/- for senior citizens and upto Rs. 15,000/ in other cases for insurance of self, spouse and dependent children. Additionally, a deduction for insurance of parents (father or mother or both) is available to the extent of Rs. 20,000/- if parents are senior Citizen and Rs. 15,000/- in other cases. Therefore, the maximum deduction available under this section is to the extent of Rs. 40,000/-. From AY 2013-14, within the existing limit a deduction of upto Rs. 5,000 for preventive health check-up is available.

Section 80DD: Deduction in respect of Rehabilitation of Handicapped Dependent Relative

Deduction of Rs. 50,000/- w.e.f. 01.04.2004 in respect of

Expenditure incurred on medical treatment, (including nursing), training and rehabilitation of handicapped dependent relative.
Payment or deposit to specified scheme for maintenance of dependent handicapped relative.

Further, if the defendant is a person with severe disability a deduction of Rs. 100,000/- shall be available under this section. The handicapped dependent should be a dependent relative suffering from a permanent disability (including blindness) or mentally retarded, as certified by a specified physician or psychiatrist. Note: A person with 'severe disability' means a person with 80% or more of one or more disabilities as outlined in section 56(4) of the 'Persons with disabilities (Equal opportunities, protection of rights and full participation)' Act.

Section 80DDB: Deduction in respect of Medical Expenditure on Self or Dependent Relative

A deduction to the extent of Rs. 40,000/- or the amount actually paid, whichever is less is available for expenditure actually incurred by resident assessee on himself or dependent relative for medical treatment of specified disease or ailment. The diseases have been specified in Rule 11DD. A certificate in form 10 I is to be furnished by the assessee from any Registered Doctor.

Section 80E: Deduction in respect of Interest on Loan for Higher Studies

Deduction in respect of interest on loan taken for pursuing higher education. The deduction is also available for the purpose of higher education of a relative w.e.f. A.Y. 2008-09.

Section 80G: Deduction in respect of Various Donations

The various donations specified in Sec. 80G are eligible for deduction upto either 100% or 50% with or without restriction as provided in Sec. 80G

Section 80GG: Deduction in respect of House Rent Paid

Deduction available is the least of

Rent paid less 10% of total income
Rs. 2000/- per month
25% of total income, provided
- Assessee or his spouse or minor child should not own residential accommodation at the place of employment.
- He should not be in receipt of house rent allowance.
- He should not have self occupied residential premises in any other place.

Section 80U: Deduction in respect of Person suffering from Physical Disability

Deduction of Rs. 50,000/- to an individual who suffers from a physical disability(including blindness) or mental retardation. Further, if the individual is a person with severe disability, deduction of Rs. 100,000/- shall be available u/s 80U. Certificate should be obtained from a Govt. Doctor. The relevant rule is Rule 11D.

Section 80RRB: Deduction in respect of any Income by way of Royalty of a Patent

Deduction in respect of any income by way of royalty is respect of a patent registered on or after 01.04.2003 under the Patents Act 1970 shall be available upto Rs. 3 lacs or the income received, whichever is less. The assessee must be an individual resident of India who is a patentee. The assessee must furnish a certificate in the prescribed form duly signed by the prescribed authority.

Section 80 TTA: Deduction from gross total income in respect of any Income by way of Interest on Savings account

Deduction from gross total income of an individual or HUF, upto a maximum of Rs. 10,000/-, in respect of interest on deposits in savings account ( not time deposits ) with a bank, co-operative society or post office, is allowable w.e.f. 01.04.2012 (Assessment Year 2013-14).

Deductions Allowable under Section 24 of Income Tax Act :

Where a housing property has been acquired / constructed / repaired / renewed with borrowed capital, the amount of interest payable yearly on such capital is allowed as deduction under Section 24 of Income Tax Act, subject to the limits stated below. Penal interest on housing loan is not eligible for deduction. If a fresh loan has been raised to repay the original loan and the new loan has been used only for the purpose of repaying the original loan then, the interest accrued on such fresh loan is allowed for deduction.

If the property is acquired or constructed with the capital borrowed on or after 01-04-1999 and such acquisition or construction is completed within 3 years of the end of the financial year in which capital was borrowed then the actual interest payable is allowed as deduction subject to a maximum Rs. 1,50,000/-.
In other case interest up to maximum Rs.30,000/- is deductible.
The ceiling of Rs.1,50,000/- or Rs. 30,000/- is only in case the property is self occupied. There is no limit on deduction of interest if the property is let out.

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The visitors may visit the web site of Income Tax Department for resolving their doubts or for clarifications.

Slab Rates of Income Tax for Financial Year 2012-13

Income Tax Rates / Income Tax Slabs for AY 2013-14 (FY 2012-13)

This page contains Income Tax rates and slabs for various categories of Indian Income Tax payers in a user friendly format. Please send your suggestions / feedback to caarpitgupta11@gmail.com to enable us to make it more useful.

Individuals (Below 60 years) & HUFs
Senior Citizens (Above 60 years but below 80 years)
Very Senior Citizens (Above 80 years)
AOPs & BOIs
Co-operative Society

Firm
Local Authority
Domestic Company
Other Company

A. Individuals and HUFs

I. Individual (other than II and III below) and HUF

	Income Level / Slabs	Income Tax Rate
i.	Where the total income does not exceed Rs. 2,00,000/-.	NIL
ii.	Where the total income exceeds Rs. 2,00,000/- but does not exceed Rs. 5,00,000/-.	10% of amount by which the total income exceeds Rs. 2,00,000/-
iii.	Where the total income exceeds Rs. 5,00,000/- but does not exceed Rs. 10,00,000/-.	Rs. 30,000/- + 20% of the amount by which the total income exceeds Rs. 5,00,000/-.
iv.	Where the total income exceeds Rs. 10,00,000/-.	Rs. 130,000/- + 30% of the amount by which the total income exceeds Rs. 10,00,000/-.

Education Cess: 3% of the Income-tax.

II. Individual resident who is of the age of 60 years or more but below the age of 80 years at any time during the previous year

	Income Level / Slabs	Income Tax Rate
i.	Where the total income does not exceed Rs. 2,50,000/-.	NIL
ii.	Where the total income exceeds Rs. 2,50,000/- but does not exceed Rs. 5,00,000/-	10% of the amount by which the total income exceeds Rs. 2,50,000/-.
iii.	Where the total income exceeds Rs. 5,00,000/- but does not exceed Rs. 10,00,000/-	Rs. 25,000/- + 20% of the amount by which the total income exceeds Rs. 5,00,000/-.
iv.	Where the total income exceeds Rs. 10,00,000/-	Rs. 125,000/- + 30% of the amount by which the total income exceeds Rs. 10,00,000/-.

Education Cess: 3% of the Income-tax.

III. Individual resident who is of the age of 80 years or more at any time during the previous year

	Income Level / Slabs	Income Tax Rate
i.	Where the total income does not exceed Rs. 5,00,000/-.	NIL
ii.	Where the total income exceeds Rs. 5,00,000/- but does not exceed Rs. 10,00,000/-	20% of the amount by which the total income exceeds Rs. 5,00,000/-.
iii.	Where the total income exceeds Rs. 10,00,000/-	Rs. 100,000/- + 30% of the amount by which the total income exceeds Rs. 10,00,000/-.

Education Cess: 3% of the Income-tax.

B. Association of Persons (AOP) and Body of Individuals (BOI)

i. Income-tax:

	Income Level / Slabs	Income Tax Rate
i.	Where the total income does not exceed Rs. 2,00,000/-.	NIL
ii.	Where the total income exceeds Rs. 2,00,000/- but does not exceed Rs. 5,00,000/-.	10% of amount by which the total income exceeds Rs. 2,00,000/-
iii.	Where the total income exceeds Rs. 5,00,000/- but does not exceed Rs. 8,00,000/-.	Rs. 30,000/- + 20% of the amount by which the total income exceeds Rs. 5,00,000/-.
iv.	Where the total income exceeds Rs. 10,00,000/-.	Rs. 130,000/- + 30% of the amount by which the total income exceeds Rs. 10,00,000/-.

ii. Education Cess: 3% of the Income-tax.

C. Co-operative Society

i. Income-tax:

	Income Level / Slabs	Income Tax Rate
i.	Where the total income does not exceed Rs. 10,000/-.	10% of the income.
ii.	Where the total income exceeds Rs. 10,000/- but does not exceed Rs. 20,000/-.	Rs. 1,000/- + 20% of income in excess of Rs. 10,000/-.
iii.	Where the total income exceeds Rs. 20,000/-	Rs. 3.000/- + 30% of the amount by which the total income exceeds Rs. 20,000/-.

ii. Surcharge: Nil

iii. Education Cess: 3% of the Income-tax.

D. Firm

i. Income-tax: 30% of total income.

ii. Surcharge: Nil

iii. Education Cess: 3% of the total of Income-tax and Surcharge.

E. Local Authority

i. Income-tax: 30% of total income.

ii. Surcharge: Nil

iii. Education Cess: 3% of Income-tax.

F. Domestic Company

i. Income-tax: 30% of total income.

ii. Surcharge: The amount of income tax as computed in accordance with above rates, and after being reduced by the amount of tax rebate shall be increased by a surcharge at the rate of 5% of such income tax, provided that the total income exceeds Rs. 1 crore.

iii. Education Cess: 3% of the total of Income-tax and Surcharge.

G. Company other than a Domestic Company

i. Income-tax:

@ 50% of on so much of the total income as consist of (a) royalties received from Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern after the 31st day of March, 1961 but before the 1st day of April, 1976; or (b) fees for rendering technical services received from Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern after the 29th day of February, 1964 but before the 1st day of April, 1976, and where such agreement has, in either case, been approved by the Central Government.
@ 40% of the balance

ii. Surcharge: The amount of income tax as computed in accordance with above rates, and after being reduced by the amount of tax rebate shall be increased by a surcharge at the rate of 2% of such income tax, provided that the total income exceeds Rs. 1 crore.

iii. Education Cess: 3% of the total of Income-tax and Surcharge.