Budget 2011-2012 highlights, PE II, PCE, IPCE, CA, Exam, Results, new answer sheet format, New Income Tax Slab Rates, Revised DTC Discussion Paper, Saral 2 Form, Perquisites Notification No. 94/2009, sec 80C, ITR Forms, Indian Union Budget 10

Finmin not in favour of companies acquiring regional rural banks

October 17th, 2010

The finance ministry is not in favour of corporates acquiring dedicated rural lenders, regional rural banks, a suggestion mooted by the Reserve Bank of India in a recent discussion paper on new bank licences.

“The disinvestment mandate is clear that we’ll not bring down the government stake in banks below 51%,” said a finance ministry official ruling out the proposal.

Under the current set up, the central government holds 50%, state government 15% and sponsoring banks 35% stake in a regional rural bank, which are tasked with providing credit in rural areas.

Jagan Mohan Reddy pays advance tax of Rs 84 cr

October 17th, 2010

Though the persistent belligerence of Congress MP Jagan Mohan Reddy has often embarrassed the Congress high command since his father and former Andhra Pradesh chief minister Y S R Reddy’s death last year, not much is known about his personal wealth.

His individual advance tax collection showcases more than what meets the eye. In the first six months of the current financial year, he has already paid Rs 84 crore as advance tax, anticipating his annual income to be in the vicinity of Rs 500 crore or much more. His earnings can put to shame corporate biggies like the Tatas, Birlas or Ambanis.

It is a significant jump, considering Jagan Mohan had paid a paltry Rs 2.92 lakh tax for the financial year 2008-09, and Rs 6.72 crore for 2009-10. His

Investment-based tax gains for Nelp-IX

October 17th, 2010

Energy explorers will get tax incentives based on their investments in the ninth round of auctions for oil and gas exploration blocks, replacing the existing regime of seven-year tax holiday on profits.

The tax benefits will extend to gas exploration as well, oil minister Murli Deora clarified on Friday at the launch of the ninth new exploration licensing policy (Nelp-IX), under which bids have been invited for 34 exploration blocks.

Oil secretary S Sundareshan said the new tax incentive regime is based on the proposed Direct Tax Code set to replace the existing income tax laws from 2012.

DTC’s impact on debt, equity funds

October 17th, 2010

The Direct Taxes Code 2010 (DTC) has prompted tax payers to reconsider investment plans. The key difference lies in the exclusion of certain savings schemes from the list of items eligible for deduction of up to Rs 1,00,000 from gross total income.

Ulips and ELSS have been left out and only approved funds like PF, superannuation fund, gratuity fund and pension fund have been retained for deduction. DTC also provides for an extra aggregate deduction of up to Rs 50,000 for payment to life insurance (annual premium not exceeding 5%, against the current 20%) of the capital sum assured); health insurance premium and tuition fees for full-time education of up to two children.

Due to the exclusion of ELSS and Ulips, there appears to be a certain apprehension that equity-oriented funds would lose attractiveness. This may

Need a home loan, get your paper work right

October 17th, 2010

Having a house of one’s own is a dream for most people. But before embarking on your housing plans, be mindful of possible loan-rejection scenarios.

Below are the possible reasons for which banks can reject your housing loan application:

Reason 1: Salary and tax statements

“Income statements of salaried individuals and three years’ income tax statements (or tax deduction at source certificates on Form 16) are crucial

Misselling of financial products

October 17th, 2010

It was a casual meeting with Bose, who, after her retirement, was part of the faculty in a management institutes. She casually said that given her age (62), a few days ago, she had been convinced to buy a pension product with a premium of Rs 1 lakh per annum and a premium paying term of 10 years.

Now, she realises that she has been taken for a ride and wants to get out of this. A familiar story, where the want/need of the customer does not determine the choice of the product.

Why does this happen? And again, why does it happen often. Investing, in a majority of the cases, is based on hearsay, tip, sales pitch and, not to forget, the greed to make easy and quick money. Also, financial products are generally sold and not bought.

Let’s now consider a few cases of how misselling takes place in a few products.

Insurance

Finmin not in favour of companies acquiring regional rural banks

Jagan Mohan Reddy pays advance tax of Rs 84 cr

Investment-based tax gains for Nelp-IX

DTC’s impact on debt, equity funds

Need a home loan, get your paper work right

Misselling of financial products

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