The time has come to file your tax returns. This is the time when you ponder over the tax you paid and the investments you made.
Were you prudent with your investments last year? Did they help you save tax? Or did you end up paying more than you could afford?
What investment mistakes did you make last year? Are their ways to rectify them? What investment options should you go for this year? What should you do to bring your tax liability to the minimum level?
Direct tax expert Vikas M Gandhi answered these queries during an hour-long chat on Thursday. Here's the transcript:
Vikas Gandhi says, Good evening friends and welcome to this tax chat session. You can start asking your queries and I'll be happy to resolve the same
Santoshu asked, Bank has provided me form 16A for TDS. Do I have to pay more than that or just add this amount in IT for calculation Vikas Gandhi answers, The rate at which tax has been deducted by Bank is @ 10%. However maximum tax slab rate for individuals is 30%. Hence it will depend upon your total income as to under which tax bracket you fall. Hence to know the exact tax liability, you will first have to add the interest amount (gross) to your income and then only you will be able to know about your tax liability
Saurabh asked, I am a salaried person with interest income. I have made donations which are eligible for exemption u/s 80G. Which form should I use for the returrn? The interest in NSCs/ cumulative fixed deposits should be accounted for IT purposes based on accrual or based on actual receipt? Vikas Gandhi answers, Since your source of income is only from Salary and interest, ITR-1 will be applicable to you. It does not matter under which section you are claiming deduction. It is always better to account for interest on accrual basis as by doing this you'll be able to spread your tax liability over a period of years.
Keshav asked, Is PPF amount which we get after 15yrs taxable if i am in higher bracket? Vikas Gandhi answers, No. the entire PPF amount you receive on maturity is exempt from tax.
promod asked, Dear Vikas, what is the last date of filing income tax returns for individuals, salaried persons? If I have 'other income' -- on which I have already paid capital gains tax -- which ITR form will I have to fill? Vikas Gandhi answers, The last date of filing income tax return for individuals, salaried person is 31st July, 2007. Since you have capital gains, you'll have to fill ITR-2 (assumed that you do not have any business income)
Harsh asked, I am salaried employee with no other source of Income. I have taken a homeloan. Where do I claim deduction of interest on Home loan? ITR-1 doesnot have such a column. Vikas Gandhi answers, You are referring to a wrong ITR form. ITR-1 is applicable only if you are receiving Salary and interest income. However since you are paying interest on home loan, you'll have to fill ITR-2.
virendra asked, I am salaried person, for the last year I was not taxable, If I file IT Return now should I be charged U/s 236A Vikas Gandhi answers, At first the question is not very clear. However I assume that you now want to file your last years return. If it is the case, since you have mentioned that there was no tyax liability, you will not be charged interest u/s 234A (not 236A)
Rajiv asked, Is TDS deducted from Rent? If yes how much and is there any limit beyond which it is deducted? Vikas Gandhi answers, TDS on Rent is deductible only if the amount of Rent exceeds Rs.1,20,000/- per annum
Rajiv asked, What is the limit and slab of Wealth Tax Vikas Gandhi answers, Wealth Tax is applicable if your net wealth exceeds Rs.15,00,000/-. If it exceeds, wealth tax is charged @1% on the wealth above Rs.15,00,000/-.
Rajiv asked, For calculating Income from House Property, if Actual Rent is more than Standard Rent, Fair Rent etc., is Actual Rent considered or such lower one. Vikas Gandhi answers, For calculating House Property, if actual rent is more than Standard Rent, Fair Rent, actual rent will be considered for the tax purpose.
Ravi asked, How to fill the income tax if one is absent during this period ??? Who can do it for me in my absence ??? Vikas Gandhi answers, For your query you can visit our site at www.taxsmile.com, which helps you in calculating and preparing return online. Government has already initiated e-filing and hence no matter wher you are, you can still file return in time
Ehsaas asked, In ITR-4 form , I am told that one needs to declare all his investments in FD's, Cash in Banks, etc etc. Is that true ? Why should one declare his investments ?? Vikas Gandhi answers, You have somke worng information. It is not that you have to declare all your investments in FD's casg in banks etc in ITR-4. It is only if you have entered into certain transactions, which exceeds the limit mentioned you need to provide the information. For further information in this regards you can refer the instrrcution page given after the particular form. If you are referring this query in context to the Balance Sheet, then you have to provide this details, as you are not required to file any additional documents alongwith the return of income
Rajesh asked, I am salaried person. I had purchased NSC bon last year. Is it required to show its interest in this year itself?. Can I include my NSC interest after maturity in my earnings? i.e. after 6 years. Vikas Gandhi answers, It will be beneficial if you show the interest on NSC on accrual basis. This is because - a) By doing so you will be spreading your tax laibility over 6 years; and b) Since interest is reinvested every year, you also get tax benefit u/s 80C of the Act.
deepak_mgupta asked, I have made some short term capital gain from property, I am employed.should I declare this income to my employer and they will deduct the tax or what I should do? I heard that I need to pay tax in advance.what does that mean? Vikas Gandhi answers, If you declare all your income to your employer, then he will accordingly deduct tax from your salary, after taking into consideration your other income also. Since tax will be deducted, while filing return of income, there will be no additional tax liability. However if oyu don't declare your other income to your employer, while filing return of income, there will additional tax liability on which you will have to pay interest which is calculated u/s 234B & 234C.
vakilahmed asked, I was a part time LIC [Get Quote] commission agent and now I am getting the commission undersection 44. What form no. ITR-1(option 1 or 2) or ITR-2 should be filled by me for showing my income of LIC commission with my salary income. the ITR-1 has only column for the interest under income from other sources and there is no column for such income like LIC commission etc. Please advise. Vikas Gandhi answers, Agency commission received will be treated as your business income and hence neither ITR-1 nor ITR-2 is applicable to you. You will have to file ITR-4 in this regards
sibith asked, My salary is 4500 per month in that i will pay my icici prudential 1500 per month is ofr 3 years after that is it taxable Vikas Gandhi answers, Your salary income itself is within exemption limit and hence there will be no tax liability
ajit asked, Do NRIs need to file tax return? Vikas Gandhi answers, If a NRI is having income which is arising in India, than for that particular income, they need to file their return of income in India
ESKAY asked, Is maturity amount of NSC (Interest) taxable? Vikas Gandhi answers, On maturity you will be receiving principal as well as interest amount. The principal component received on maturity is not taxable. As far as interest is concerned, if you have already offered for tax on accrual basis, then only the last years interest will be taxable otherwise, entire interest amount will be taxable in the year of maturity
gandhi asked, Income a/cs writing + int.in F.Y.2006-07 was Rs.115000, PPF 12000,LIC 13800,Mediclam 2800. I left India on 20.04.2007 as I got a jon in Africa $900 p.m. Can I my file retunn once I come to India in Apr-2009 & I pd.LIC 2218 p.a.for mother,policy matured, chq.recd.Rs.31000 on 21.6.2007 deposited in her a/c,If I transfer LIC amt.to my S.B.a/c in India,is it taxable / allowed ? I have int.income of Rs.45000+other income 40000 in F.Y.2007-08 , please do sugest ... Vikas Gandhi answers, For filing income tax return for F.Y.2006-07, you cannot wait till 2009. The due date for filing return is 31/07/2007 and you have to file returns by that date. Since an individual can file returns electronically form this year, you can avail of this facility, although you are based outside India. YOu can visit www.taxsmile.com for further information. You can certainly transfer the LIC amount to your account and it will not be taxable.
suresh asked, IF THE SALARY IS BELOW RS.110000, IS IT COMPULSORY TO FILE RETURN FOR RETIRED PERSONS Vikas Gandhi answers, No. If the salary is below the taxable limit, it is not compulsory for you file the returns
Ehsaas2 asked, is it compulsory to declare all the Bank accounts in ITR-4 form ? Vikas Gandhi answers, If this quesiton is with regards to the bank information, then you need to provide details of only one bank acocunt where you want to get your refund amount deposited. However is the quesiton is with regards to the Financial information asked in ITR-4, then you have to provide details of all your bank accounts
Ehsaas2 asked, In ITR -1 form there are two forms- option 1 & option 2. What is the difference ? Vikas Gandhi answers, There is no difference between option 1 & option 2 of ITR-1, except that option 1 is of two pages and option 2 is of three pages. Content wise there is no difference.
Vikas Gandhi says, Thank you friends for this wonderful session. I am aware that most of the quesitons have remained unanswered. But in this short time frame, I've tried to resolve as much queries I could. Thanks.