Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: list of goods taxed at 4% :: VAT RATES :: TDS :: cpt :: ACCOUNTING STANDARDS :: ARTICLES ON INPUT TAX CREDIT IN VAT :: empanelment :: form 3cd :: articles on VAT and GST in India :: due date for vat payment :: ACCOUNTING STANDARD
« General »
 Banks warn share tax hike threatens Paris' post-Brexit appeal
 PMC may decide on property tax rebate for IT firms this week
 I-T Dept is giving out certificates of appreciation. Have you received yours?
 Government works on ironing out benefits refund mechanism for exportersa
  Tax officials are using an IDS provision to question transactions beyond six-year-limit
 Tax-free bonds rally like midcap funds
 Senior citizens do not have to pay advance tax on salary and interest income
 GST: Audit commissioners to get adjudication powers
 Interest on NRE rupee account can be exempt from tax under FEMA
 Impact of GST on Real Estate Sector
 GST regime: Tax payers allowed to take option of third-party interfaces

Regulator pitches for tax relief
May, 27th 2010

The interim pension regulator has sought tax relief on investments in the New Pension Scheme (NPS) to make it more attractive to employees of private sector firms.

The Pension Fund Regulatory and Development Authority (PFRDA) has written to the finance ministry seeking level playing field for NPS with other long-term savings schemes that will get tax benefits under the proposed Direct Taxes Code. All we want is equal treatment, a PFRDA official said.

NPS is currently under the Exempt-Exempt-Tax system, which means investment will be taxed when it is withdrawn. Provident fund and many of the small savings schemes are under the Exempt-Exempt-Exempt (EEE) regime, and are not taxed at any point.

If the finance ministry plans to continue with the EEE regime for long-term saving schemes, we want the NPS also to get the same treatment, the official said, requesting anonymity. Several multinational companies are talking to us. We need more clarity on the tax treatment, he said.

The pension regulator has, in its letter to the central board of direct taxes (CBDT), said tax benefits will make the scheme more attractive and will help increase its share.

While a few public sector units such as Nalco and Damodar Valley Corporation have already transferred a portion of their superannuation funds to the NPS, many private sector companies and public sector banks are also exploring the option as it would rid them of the headache of administering and managing the funds.

This would be a good step. It would allow private companies to move their superannuation funds to the NPS, said Amit Gopal, vice-president of pension consultant India Life Capital.

The PFRDA has further requested for an additional window under Section 80C of the Income Tax Act for contributions by subscribers employers.

Investments in specified schemes up to Rs 1 lakh are exempt under Section 80 C of the Income Tax Act. The budget for this year has given an additional exemption of Rs 20,000 for investments in infrastructure schemes.

Under Indian laws, companies with over 100 employees have to contribute 12% of an employees salary to the provident fund with an equal contribution from the employer.

The NPS, a defined contribution superannuation scheme for government employees, was thrown open to the private sector in May last year. The scheme offers subscribers the flexibility to decide their investment portfolio as well as choose between fund managers.

With weighted returns of over 12% annually, NPS is expected to be the ideal long-term saving instrument for workers in the unorganised sector. Its low fund management fees of 0.009% make it attractive.

The scheme, however, has managed only 6,500 private subscribers, partly because it does not enjoy some tax benefits given to private provident fund and private super annuation funds.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Company Overview

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions