There were three proposals related to the National Pension Scheme in Budget 2024. A discussion. 1. The finance minister said, “The Committee to review the NPS has made considerable progress in its work. I am happy that the Staff Side of the National Council of the Joint Consultative Machinery for Central Government Employees have taken…
Continue reading →Many readers have asked us how they should modify their investment strategy after 2024. Some of the critical aspects of budget 2024 that will affect no-so-rich investors are: Tax on equity investments has increased from 10% to 12.5%. The increase of the Rs 1 lakh tax-free limit to Rs. 1.25 is largely inconsequential. Share buybacks…
Continue reading →This article explains how capital gains from different investments will be taxed. These are applicable for redemptions made on or after 23rd July 2024. Indexation benefits are history for all asset classes. Update: Finance Bil 2024 has been amended. Taxpayers can now choose either 12.5% without indexation or 20% with indexation, whichever is lower for…
Continue reading →Budget 2024 has proposed a Big change in mutual fund taxation rules, as explained in our earlier report. This article explains how fund of funds (FoFs) will be taxed from 23rd July 2024. Note: This is based on our understanding of budget documents. Errors, if any, will be updated when they come to our attention….
Continue reading →Here are 16 immediate steps a person who has just started earning should consider to manage their money better. Money is there to be spent. There is no point in saving or investing money without enjoying the present. At the same time, we should also invest some of our money to continue enjoying the present in…
Continue reading →Currently, section 80CCD(2) allows a deduction in the taxable income from National Pension Scheme Employer contributions – 10% from non-government subscribers and 14% from government subscribers. This deduction is allowed in both the old tax regime and the new tax regime. Also see: Budget 2024: New Tax Regime vs Old Tax Regime Calculator: Check which is…
Continue reading →Budget 2024 has revised the real estate taxation rule. Long term capital gains tax has been modified from 20% with indexation to 12.5% without indexation for any sale made on or after 23rd July 2024. Update: Finance Bil 2024 has been amended. Taxpayers can now choose either 12.5% without indexation or 20% with indexation, whichever…
Continue reading →Budget 2024 has revised the taxation rule governing family pensions. Existing rule: deduction of Rs 15,000 or 1/3rd of the pension amount, whichever is lower shall be made before computing the income chargeable under the head “Income from other sources”. Revised rule: deduction of Rs 25,000 or 1/3rd of the pension amount, whichever is lower…
Continue reading →Budget 2024 has proposed big changes in mutual fund tax rules. There are now three types of mutual funds: (1) Equity MF (65% or more domestic equity),(2) Debt MF (65% or more bonds). (3) Other MF (neither 65% equity nor 65% bonds) 1 Equity mutual funds (65% or more domestic equity) New rule: long-term capital…
Continue reading →Budget 2024 has further reduced the tax burden in the new tax regime. Use this free calculator to compare the old and new tax regimes (calculations for past new tax regime slabs are also available). This comparison table was originally prepared by Vinay Vittal, modified by Balasubrahmanyan and then by me post budget 2024. This…
Continue reading →A reader says, “There is an option of ” continuation of NPS” till 75 years of age where subscriber can continue contributing. I want to confirm if the annuity is not required to be purchased till 75 years if this continuation option is selected”. The NPS exit and withdrawal rules have been amended so often…
Continue reading →This is a debt mutual fund screener for portfolio selection, tracking, and learning. It also includes hybrid funds that invest in bonds. It will satisfy investors who wish to invest in money market funds, banking PSU funds, etc. The credit quality of the bonds in the portfolio and the bond maturity profile can be tracked….
Continue reading →In a consultation paper dated July 16th 2024, SEBI has proposed the introduction of a “New Asset Class” (for now, that would be its name) with a “risk-return profile between MFs and PMS.” Public comments can be sent via this link until Aug 6th 2024. The paper says, “The proposed New Asset Class seeks to…
Continue reading →A reader asks, “I am 27 years old. My current monthly expenses are about Rs. 30,000. I don’t intend to get married. Can I achieve financial independence at 40 if my net worth today is zero?” Let us determine what the freefincal robo advisor tool coughs up for this scenario. The assumptions and inputs are…
Continue reading →This index fund screener is based on tracking error and returns difference wrt benchmarks (aka tracking difference). The screener will help users evaluate how efficiently an index fund has tracked its underlying benchmark. It will also help to understand how tracking a midcap index or the Nifty 100, 500 differs from tracking the Sensex or…
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