From The Desk of CA SANDHYA JAIN

Investment in NSC Why in NSC? One of my friends asked me why I invest in NSC (national saving certificate). Although he knows that investment in NSC is safe, tax saving u/s 80C, interest received on it is exempt, he tired to validate his part by giving example of PPF, PPF is safe, provide tax saving u/s80 its interest also exempt from tax and the best part of PPF is that it cannot be attached or forfeiture on order of court of law. After hearing his point of view I started narrating the benefits of NSC, here I am not comparing the two but only writing why we should invest in NSC. Type of NSC   NSC’s are two types 5year and 10 year both carry different rate of interest. The 5 year NSC carries 8.60% and for 10 year NSC carries 8.90% rate of interest these were applicable w.e.f. April 1 st 2012 but it has been changed and the changed rate are applicable w.e.f. April 1 st 2013 which are 8.5% and 8.8% respectively. These two are known as NSC VIIIth issue and IXth issue ...

Income Tax Slab Rate Today we discuss about income tax slab rates, these were introduced in budget proposals of that year and get implemented for the coming assessment year like for the assessment year 2014-15 no changes is proposed in budget proposal of 2013 except the saving in tax by Rs. 2000 on the total taxable income   of up to 5,00,000. Except the benefit of Rs. 2,000 rest of the slab rates is similar to last assessment year 2013-14 there are no changes. No extra benefits are given to senior citizen, very senior citizen or female individual. And the Rs. 2,000 benefit is not of much useful to very senior citizen as they have extended exemption limit of nil tax up to Rs. 5, 00,000 Let see how it works                                   Current Tax           ...

Taxation of Gifts Gift tax in India has ceased to apply with effect from gifts made on or after 01-10-1998 or after. Before Oct. 1998 gifts has been taxed in India under gift tax act 1958 it covers all transactions made with the name of gifts. The Act defines “Gift” means the transfer by person to another of any existing movable or immovable property made voluntarily and without consideration in money or money’s worth or short consideration. Although this act has been ceased to apply but the definition of gift is still valid. Now gifts are taxed under section 56 (v), (vi), (vii), (viia), (viib), (viii) income from other sources, this section has wide coverage of transactions which made without consideration or less/ short consideration. We will discuss one by one all clause of section 56 enumerated above. Sec 56(v),(vi)& (vii) It States that any amount exceeding Rs.50, 000 received from a person other than a relative or at the time of marriage or u...

Wishing you and your family a very bright, colourful and joyful holi .!!!

INTEREST RATE PPF ,NSC, SCSS, MIS ,POTD REDUCED 01.04.2013 Govt. of India has announced the reduction in rates of PPF, NSC and senior citizen saving schemes by .10%. These reduced rates will be effective from 1 st April 2013. However Post office small saving scheme and saving account   and post office fixed deposit schemes for 1 yr will carry the interest rate 4% and 8.2% these are intact. Schemes which affected                        Current rate                   Revised rate                                                  ...

Service Tax Service tax was first introduced by finance act 1994 with 5 services and out 5 only three were taxable at that time. Steadily and gradually till the year 2011 covered approximately 125 or more services covered in tax net and 119 services were taxable. But the finance act 2012 brings major revolution in service tax by introducing place of provisioning rules 2012 as well as   negative list of services before brings these changes govt. also introduced point of taxation rule 2011 vide finance act 2011. Although government brings time to time changes in services tax it also amends various laws to enhance and increase revenue and also to reduce litigations, as the matter of fact is that only in service tax we used to saw least compliances asked by the authority. The approach adopted by the authorities was quite flexible as compare to other tax laws. The year 2011 and 12 was the year of revolution in Service tax field as in these two years cumulatively proposed and a...