Faceless E-assessment Scheme for Income Tax: What is it? Will it help?
A discussion on the Faceless E-assessment Scheme for Income Tax. What is it and what taxpayers need to keep in mind when this comes into play
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This is the archive of all our articles related to income tax and filing of tax returns
Equity fund of fund taxation rule changed: Can we invest in them now?
Budget 2019-20 has proposed a change in short-term capital gains tax of equity-oriented fund of funds and this has resulted in some unnecessary confusion. I was asked this question twice in the last two days and I thought it best to clarify. A fund of fund (FoF) is a mutual fund that invests in other…
Continue reading →Pre-filling of Income-tax Returns: Good move or bad?
The finance ministry wants pre-filled income tax returns from AY 2020-201 onwards as announced in the budget yesterday. At first sight, this is appealing and convenient, but will it result in a host of new problems? The finance minister in her budget speech said, “Pre-filled tax returns will be made available to taxpayers which will…
Continue reading →CPSE ETFs with Tax Saving benefit Introduced in Budget 2019-2020
The finance minister in her budget speech said: “ETFs have proved to be an important investment opportunity for retail investors and has turned out to be a good instrument for Government of India’s divestment programme. To expand this further, The government will offer an investment option in ETFs on the lines of the Equity Linked…
Continue reading →Filing Equity LTCG in ITR2 (AY 2019-2020) is messy! Here is a way out!
From the financial year 2018-2019, long term capital gains above Rs. one lakh from stocks and equity mutual funds are taxed at the rate of 10%. The assessment year 2019-2020 is the first time when taxpayers will have to report equity LTCG in schedule CG of ITR2. However, since the income tax department did not…
Continue reading →Which ITR Form Should I use for A.Y. 2020-21?
The Income Tax Department has published ITR forms for A.Y. 2020-21. You can use this article to quickly determine which form is right for you. As on date, only the PDF version of the forms are available. Once the Excel and Java utilities are available, you can download the ITR forms from here. You can…
Continue reading →Why can’t we get rid of income tax returns?
We cannot afford to get rid of income tax, but why can’t we get rid of income tax returns? Difficulty in figuring out which ITR form to use, which rows to fill, delays in processing, delay in refunds, hassles with TDS, irritating notifications to respond to, I could go on. All this makes you want…
Continue reading →Handling mismatch between salary income in return and Form 26AS (adjustments u/s 143(1)(a))
Did you receive an email from the income tax department that there is a mismatch or inconsistency between salary income in return and Form 26AS?I did and this is how I responded. I am not a taxation expert, but I thought sharing this might help others and in any case myself. First of all, I think…
Continue reading →Should I book profits each year to lower Equity LTCG Tax?
Readers may recall that I have been covering equity LTCG tax in a series of posts. First, the implications, followed by simple examples on how to calculate LTCG tax after accounting for the grandfather rule. Then we discussed an illustration of how much Equity LTCG tax we need to pay. Now, in the second part of…
Continue reading →Myth busted: You do not get 30% returns by investing 50,000 in NPS!
You would be surprised as to how many people believe that by investing an additional 50,000 in NPS, they “instantly” get a return equal to their tax slab! This is a case of mis-accounting or innumeracy. In this post, I discuss what exactly is the implication of “saving tax” via investing in 80C and with…
Continue reading →When and How Capital Gains Tax Can be Reduced
Under certain circumstances, long-term or short-term capital gains tax to be paid can be significantly reduced. It is not routinely possible and therefore important to recognize this possibility if and when it arises. This post stems from a discussion at Facebook Group Asan Ideas for Wealth, started by Subrat Dash, with the circumstances explained by…
Continue reading →Linking Aadhaar to PAN is not necessary for filing AY 2017-18 Income Tax Returns
Finance Bill 2017 was passed in the Lok Sabha on 22nd March 2017. Several amendments were introduced just before it was passed. Some of the key amendments involve the Aadhar card. In this post, I discuss why linking Aadhaar to PAN is not necessary for filing AY 2017-18 Income Tax Returns. The amendments: (1) After…
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