Max Secure Financial Planners -
Infosys share price crashed yesterday due to the resignation of their CEO Mr. Vishal Sikka, the first non-founder CEO.He cited the interference of Founder Mr. Narayan Murthy in his domain. But Mr Sikka reiterated his belief in the great potential of Infosys. The founders of Infosys were known for good corporate governance but face a great challenge on succession planning going ahead.
Business tycoon Mr Vijay pat Singhania,founder of Raymonds has been entangled with his son Mr Gautam Singhania on inheritance of his empire.He has already handed over his empire to his son but he has no money to meet his daily expenses. It has a message for parents across the country; " Do not be blinded on your retirement planning and be careful in transferring your created your wealth to your children".
The period between 2002-2011 was a golden period for real estate investments. Now we have some data to understand the current situation. The National Housing Bank (NHB), the regulator of housing finance companies have launched a revamped RESIDEX, a housing price index. The index claims to offer home prices of 50 cities across the nation.
This should help us get some idea about which way the real estate prices have gone over the last few years. And for the first time we should be able to calculate the actual city wise returns. Let's take a look at Table below. It shows the annual returns of some selected cities between June 2013 and March 2017. It also shows the one-year return between March 2016 and March 2017.
We need “Roti, Kapada and Makaan” before thinking about achievement of other financial goals. The key financial goals for families currently are; Children’s education and Retirement corpus. A roof over our head is a basic necessity no doubt, but should we go for owning it or stay in a rented house? If you aspire to own an expensive house, the home loan EMI may make you poor and you may have no money left for other expenses after paying the EMI. It will be difficult to maintain a healthy balance between housing and other critical goals. The factors to consider in buying a house vs renting are;
During February 2016, the Government of India had announced that it will review small savings interest rates every quarter based on the yields of government bonds of the previous three months.Recently the government has reduced interest rates on small savings schemes to align them with market for the quarter beginning 1 April 2017.
The commercial Banks were reluctant to pass on the policy rate cuts by RBI citing the higher small savings rate. Now this linking of interest rates of small savings schemes to the yields of government securities and reduction in rates will prompt the banks to pass on the policy rate cuts to the borrowers through lower lending rates.
The rates have been reduced by 10 bps of all small savings schemes including PPF,senior citizens’ saving scheme, postal time deposits, KVP,NSC and Sukanya Samriddhi excluding the Postal Savings account which has been retained at 4%.The Government has also retained the spread of 25 basis points of long-term savings schemes such as the five-year term deposit and National Savings Certificates (NSC) etc over government securities of comparable maturity to encourage long-term savings.
(1) From financial year 2017-18, if Return is not filed within due date, late fee of Rs 5,000/- for delay up to 31st December, and Rs 10,000/- thereafter.
(2) Every person who has been allotted PAN as on 1st July 2017 must intimate the AADHAR number to the Tax Authority, failing which, PAN allotted to such person shall be deemed to be invalid. Kindly note that linking of AADHAR with PAN is not possible, unless name as per AADHAR and PAN match perfectly. Hence, please take steps to rectify your name as per AADHAR to match as per PAN.
3) Tax Exemption limit is Rs 2,50,000/- (same as earlier) -
- After that, upto Rs 5 lakh, Tax Rate is 5% (earlier it was 10%). Tax rebate of maximum Rs.2500 will be allowed, for total income upto Rs 3.50 lakhs.
-Individuals having total income exceeding Rs 50 lakhs but below Rs 1 crore, are to pay surcharge @ 10% of the tax. Those having total income exceeding Rs 1 crore shall continue to pay surcharge @ 15%.
(4) Payment of Rent – Rs 50,000 per month by any Individual or HUF (not subject to Tax Audit requirements) - deducts TDS @ 5%.
In the past few weeks, we have seen banks either introducing new charges or hiking the existing ones sharply. While many customers complain of banks robbing them with higher charges, those from the banking industry say customers need to pay for the services they enjoy. Customers’ pain point, however, is not just the fee, but the non-transparent, arbitrary manner in which charges are being levied.
Savings for Income Tax
All tax-saving investments and expenses have to be made before March 31 2017.
- 80(C) : Ensure savings of Rs 1,50,000/- atleast (EPF, PPF, NPS, Life Insurance premium, Home loan principal repayments etc)
- 80(D): Health Insurance premium of Rs 25,000/- for self and family and Rs 30,000 for parents who are senior citizens. You can claim of Rs 5,000/- for health check up under section 80 (D).
- Get reimbursements from your employer by submitting medical bills maximum of Rs 15,000/-
- LTA: Keep the journey tickets as evidence for tax exemption.
- Calculate your tax liability by taking(a) Interest on housing loan(b) Exemption from HRA factoring the house rent paid and (c) Conveyance allowance(Rs1,600pm)
- Advise the salary section to stop Income Tax deduction for February and March 2017, if the tax deducted has exceeded your tax liability. Alternatively you have to apply for refund of excess tax paid by you.
There is a debate on segregating sales from investment advice.SEBI has proposed that mutual fund distributors cannot give investment advice to buyers and proposed to make it compulsory for mutual fund distributors who give advice to register as investment advisers. We reproduce the view of Prof Pattabiraman at IIT-Madras as published in ET wealth on 16th January 2017.
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Steve Jobs said, "People don't know what they want until you show it to them". This applies to conflict of interest. In a recent consultation paper, Sebi proposed that mutual fund distributors should not provide incidental or basic investment advice in respect of mutual fund products and should not call themselves advisers.
NPS has emerged as a popular tax saving tool at par with EPF. but the issue on taxation of 60% of the proceeds on maturity or buying annuity is a moot point and hoped to be resolved soon. Opening of NPS account was a herculean task till now but have been made easier through online NPS account.
Types of NPS accounts: There are Two types of account i.e TIER I and TIER II
- Tier I is the mandatory account for long-term savings. Additional Tax benefit upto Rs.50,000 is available u/s 80CCD (1B) over and above the 80C limit of Rs1,50,000/-
- Tier II is an add-on account which provides you the flexibility to invest and withdraw from various schemes available in NPS without any exit load.
- To open Tier II account you need to have Tier I account first.
These are times of uncertainties! Who could have predicted the address to the nation by the Prime Minister on the evening of 8th November 2016. Remonitisation have become painful for many for standing in long queues. More uncertainties are in store in the coming days! GST will overhaul the indirect taxation system in the country. Short term pains but long term gains? Now coming to personal finance; there is a need to question our core beliefs and think differently. Let us take income, assets, liabilities, expenses and retirement!
Income: Where does your income come from? Is it salary from your employer? This is an external source. It is like water flow in a river. But looking it from a bigger picture, the real source of river water is the spring. Similarly the source of income is not the monthly salary but your skill, time, intelligence and experience. If you focus on up gradation of your skills that generates your income streams, you are more likely to preserve a steady income in the long run. Conversely if do not upgrade your skills in tune with the demand of the times, you are more likely to miss out on generating income. Think for a moment about the prospect of losing your job, look at your skill sets. They may be more valuable if you have kept them honed. Do not ignore skill building and networking even after you have settled in a job.