9 FAQs on Capital Gains Account Scheme !

Capital Gains Account Scheme 1988  ( the Scheme after this ) is well known among tax payer as this is one scheme for providing relief to tax payer by providing extra two years to buy or construct the house.The  Scheme has prescribed its own  rules and forms . This site has posted earlier on the…

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Cost Audit & Compliance Report Now by 31st Jan 2013 !

The cost audit report and compliance report dates have been extended to 31st January 2013 , as per the GENERAL CIRCULAR NO. 43/2012, DATED 26-12-2012 issued by Ministry of Corporate affairs . The said circulars is as under

In continuation of MCA’s General Circular Nos. 8/2012, dated May 10, 2012 [as amended on June 29, 2012] and 18/2012, dated July 26, 2012, it has been decided that all cost auditors and the companies concerned are allowed to file their Cost Audit Reports and Compliance Reports for the year 2011-12 [including the overdue reports relating to any previous year(s)] with the Central Government in the XBRL mode, without any penalty, within 180 days from the close of the company’s financial year to which the report relates or by January 31, 2013, whichever is later. The Institute is requested to circulate this for the information of all concerned

Senior Citizen Interest Rate 9.3 % from 1st April

Senior citizen savings scheme has got an amendment in rate of interest ! It has been notified vide NOTIFICATION NO.GSR 321(E), DATED 25-4-2012 that all deposits in senior citizen savings scheme 2004 shall be 9.3 %. Read the notification

SENIOR CITIZENS SAVINGS SCHEME (AMENDMENT) RULES, 2012 – AMENDMENT IN RULE 7

NOTIFICATION NO.GSR 321(E), DATED 25-4-2012

In exercise of the powers conferred by section 15 of the Government Savings Banks Act, 1873 (5 of 1873), the Central Government hereby makes the following rules further to amend the Senior Citizens Savings Scheme Rules, 2004, namely:—

1. (1) These rules may be called the Senior Citizens Savings Scheme (Amendment) Rules, 2012.

(2) They shall deemed to have come into force on the date of their publication in the Official Gazette.

2. In the Senior Citizens Savings Scheme Rules, 2004, in rule 7, in sub-rule (1), the following proviso shall be inserted, namely:—

“Provided that in the case of a deposit made under these rules on or after the 1st day of April, 2012, it shall bear interest at the rate of 9.3 per cent, per annum from the date of deposit.”

VDIS 2011 A reality ??

It was this site that reported Is VDIS coming back this budget 2011-12? Media reports that the government is seriously  considering the option of a voluntary disclosure scheme” for bringing back unaccounted money kept in banks abroad.VDIS was launched by the finance ministry domestically in 1997 and it helped the government increase revenue collections dramatically.

 

VDIS 2011-12

The proposal is considered  Corporate India’s wish list to government , reportedly brought before Finance Minister on 1st August 2011 , with  the argument that  the funds brought back can be deployed towards financing infrastructure projects in the country.VDIS

An expert group on black money had, earlier, recommended that an offshore voluntary compliance scheme may be considered by the government so that taxes could be collected on such monies kept abroad in undisclosed accounts and the assets held by resident Indians abroad.

Voluntary disclosure schemes ( VDIS ) are currently available in many countries such as the US, the UK, Germany, France, Greece, Italy and Portugal.

Peek into VDIS scheem in offing

Under the new scheme, the government may not ask a person the source of the money, but criminal action would be taken if it is proved the money was earned though unlawful activities. As a member of the Financial Action Task Force, India cannot grant amnesty to people who collect black money as proceeds from crime.

The officials said if a minimum penalty was imposed, a person would still be able to save a portion of the unaccounted money kept abroad. Currently, a penalty of 100 to 300 per cent of the tax rate is levied on non-disclosure of overseas assets and income. So, if a penalty of 100 per cent is imposed on taxable income at 30 per cent, one would be able to retain 40 per cent of the money.

Long live VDIS !!

Senior Citizen Savings Scheme: No Age Bar for Retired Defence Personnel

armed_forceA retiring employee becomes eligible for Senior Citizen Savings Scheme after attaining age of 55 years. However , exception is made in case of Defence Personnel (other than Civilian Defence Employees ) who can join at any age after retiring from defence jobs.

It was brought to notice of CBDT that many banks are not letting retired employees to open Senior Citizen Saving Accounts on pretext age. CBDT has once gain issued circulr to mitigate hardship

It has been brought to our notice that some of the agency banks do not implement the instructions given in Government of India’s Office Memorandum F. No. 2-8/2004-NS-II, dated October 29, 2004 (Annexure) and circulated to agency banks vide our Circular RBI/2004-05/259 Ref. CO. DT. No. 15.05.001/H-3999-4021/2004-05, dated October 30, 2004, particularly in case of retired army personnel and have denied the facility of this Scheme to some of them in contravention of the instructions ibid.

2. We, therefore, reiterate that you may strictly adhere to the instructions issued vide our above circular and ensure extending the benefits of the scheme to retired army personnel also, if otherwise found in order.

3. You may bring the contents of this and the earlier circulars to all your branches dealing with this scheme.

Annexure

Clarifications regarding Senior Citizens Savings Scheme, 2004 (SCSS)

OFFICE MEMORANDUM [F.NO.2-8/2004-NS-II], DATED 29-10-2004

The undersigned is directed to say that this Ministry has issued certain amendments to the Senior Citizens Savings Scheme Rules, 2004 (SCSS) on 27th October, 2004. A ‘Press Communiqué’ was also issued to this effect on 28th October, 2004. It has been reported in certain sections of the ‘Press’ that the scheme has been modified to include all persons who are 55 years but less than 60 years of age, as eligible persons for the purpose of this scheme.

2. It is, however, clarified that only persons retiring on superannuation or otherwise and who have attained the age of 55 years or more but less than 60 years on the date of opening of account, have been made eligible to subscribe to the scheme vide the amendment referred to above.

3. The minimum age limit of 60 years shall continue to apply in all other cases as per the specified provisions.

4. It is further clarified that only Defence Personnel (excluding Civilian Defence Employees), retired on superannuation, shall be eligible to subscribe irrespective of the age limits. Personnel, retiring otherwise than on superannuation, shall be eligible to subscribe to the scheme only after attaining the age of 55 years.

5. Copies of signed notification effecting the amendments have already been sent to the Department of Posts and Reserve Bank of India for their information and necessary action vide this Department’s letter of even No. dated 27th October, 2004.

6. The above clarifications may kindly be brought to the notice of all concerned immediately in order to avoid any wrong interpretation/irregular investments. This may kindly be treated as most immediate

Receipt of this OM may kindly be acknowledged by return fax.

Tax Relief to Govt Servants & employees under New Pension Scheme

healthcare hospital

NPS pension scheme

Now new government staff and even other employer are providing pension through contribution to New Pension Scheme . Government employees will be happy to note that Finance Bill 2011-12 has one amendment which will give them big tax relief. The relief is that now the contribution by central government or any employer to new pension scheme up to 10 % of salary shall be given additional deduction u/s 80CCD . Thus the , the contribution by govt or employer will be tax free.

The government has rectified this anomaly by simply changing the word “section 80CCD ” to sub-section 1 of section 80 CCD ” in section 80CCE which limits the aggregate deduction u/s 80C, 80CCD and 80CCC to Rs 1 lakh only.

Now the amendment proposed by Finance Bill 2012 is that Rs 1 lakh limit will be as under

  1. Deduction u/s 80C
  2. Deduction under sub section 1 of 80CCD (1) (Employees contribution )
  3. Deduction u/s 80CCC

Sub section 2 of section 80CCD deals with the pension contribution by government or employer.

Income Tax Depratment Seizes Cash of Rs 5.67 Crore From Asansol based Chit Fund Company

In a major breakthrough, the I-T department has busted a fraudulent scheme running into a tune of Rs150 crores in Asansol in West Bengal.  This  ‘ponzi scheme’ infamous recently by Maddof’s financial frauds and more popularly known as a ‘chit fund’  in India was being run by three individuals based in Asansaol, who took huge deposits from the public, mainly those who resided in villages and small towns of West Bengal after promising them unusually high returns.

After conducting searches at the firm’s premises the I-T department has seized Rs 5.67 crore in cash, Rs 4.90 worth bank drafts and fixed deposits worth Rs 2 crore. The department has also computed a tax liability of Rs 50 crore on the firm, which is to be paid to the I-T before March 31 this year. Apart from this the I-T department is also taking police help to trace the numerous investment agents who canvassed for this illegal scheme in the villages and small cities.

What Foreign exchange transactions abroad allowed without approval of RBI ?

The Reserve Bank of India had announced a Liberalised Remittance Scheme (the Scheme) in February 2004 as a step towards further simplification and liberalization of the foreign exchange facilities available to resident individuals.Under the Liberalised Remittance Scheme, all resident individuals, including minors, are allowed to freely remit up to USD 200,000 per financial year (April –…

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Is Commuted Value of Pension Tax Free?

Whether the amount received as commutation of pension is taxable or not , Sardindu Basu, KolkataYes, the commuted value of pension is tax free as per section 10(10A) . However quantum is dependnt on the fact who is the employer who paid pension to you. Section 10(10A) states1. FULL exemption of commuted value of pension…

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