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Frequently Asked Questions

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Income Tax Efiling

What is a return of income?

It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income are communicated to the Income-tax Department. Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. These forms can be downloaded from www.incometaxindia.gov.in

What are the different modes of filing the return of income?

The Return Form can be filed with the Income-tax Department in any of the following ways, -by furnishing the return in a paper form;by furnishing the return electronically under digital signature;by transmitting the data in the return electronically under electronic verification code;by transmitting the data in the return electronically and thereafter submitting the verification of the return in Return Form ITR-V;

Is it necessary to attach any documents along with the return of income?

ITR return forms are attachment less forms and, hence, the taxpayer is not required to attach any document (like proof of investment, TDS certificates, etc.) along with the return of income (whether filed manually or filed electronically). However, these documents should be retained by the taxpayer and should be produced before the tax authorities when demanded in situations like assessment, inquiry, etc.

TAX NOTICE

Who needs to file Income tax return?

If you are an NRI, you would have to file your income tax returns if you fulfill either of these conditions: Your taxable income in India during the year was above the basic exemption limit. (for the financial year 2016-17 amount is Rs. 2.50 lacs)

Who can file an Income Tax Return ?

Any Individual having the following types of income can opt for filing return-Income from salaryIncome from house propertyIncome from sale of investments (shares, mutual fund units, bonds) or propertyIncome by way of interest, dividend, gifts, family pension, agricultural incomeBrought forward losses (except loss from activity of owning and maintaining race horses)Clubbing of income

Can you help us in filing taxes in India?

Yes. We can help you to file taxes in India. Please fill up the attached form and email it to us at info@taxassist.in We just need your personal details as well as income details to file income tax return in India. We offer excellent tax support in addition to filing of return of income and comprehensive tax planning. After which we take care of online tax return filing in most hassle free manner, making online income tax filing an excellent experience.

REPATRIATION

What are the Tax implications in respect of remittance of assets?

All remittances are subject to payment of taxes as applicable in India – Authorised Dealers are to convince themselves on this aspect.

What is meant by Remittance of Assets?

‘Remittance of assets' means remittance outside India of funds representing a deposit with a bank or a firm or a company of: provident fund balancesuperannuation benefitsamount of claim or maturity proceeds of Insurance policysale proceeds of shares, securities, immovable property or any other asset held in IndiaWhat are the Tax implications in respect of remittance of assets?All remittances are subject to payment of taxes as applicable in India – Authorised Dealers are to convince themselves on this aspect.

Can I repatriate money out of balances held in my NRO accounts?

Interest earnings can be repatriated. In addition to this, remittance/s up to USD 1 million per calendar year from balances in NRO accounts subject to payment of applicable taxes is allowed for any purpose up to an aggregate value of USD 1 million The documents required to be produced for effecting a remittance are: Account holder's Letter giving details of purpose of remittance and certifying the sameCheque or debit authority if the same is not contained in the letter in item (i)Application in Form A2A certificate from a Chartered AccountantFEMA Declaration to be filled in by the NRI

Can I repatriate money from my Property and Investment Income?

All forms of current income arising out of investments in India are repatriable. This includes income by way of interest, dividends, rentals, etc. Current income is repatriable even if the asset generating the income itself is not. There is no ceiling on the value of such remittances and the amounts are remitted out of the NRO Account based on the following documents: The documents required to be produced are: Account holder's Letter instructing the remittanceCopy of document/s establishing the inheritance and value of proceeds credited to the NRO accountChartered accountant's certificate in the format prescribed by IT authoritiesCheque or debit authority if the same is not contained in the letter in item (i)Application in Form A2

Are funds in FCNR accounts freely repatriable abroad?

Yes

Taxation

What is a return of income?

It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income are communicated to the Income-tax Department. Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. These forms can be downloaded from www.incometaxindia.gov.in

​Is it necessary to attach any documents along with the return of income?

ITR return forms are attachment less forms and, hence, the taxpayer is not required to attach any document (like proof of investment, TDS certificates, etc.) along with the return of income (whether filed manually or filed electronically). As discussed above, no documents are to be attached along with the return of income, however, in case of a taxpayer who is required to furnish a report of audit under section​ 10(23C)(iv), 10(23C)(v), 10(23C)(vi), 10(23C)via), 10A, 10AA, 12A(1)(b), 44AB, 44DA, 50B, 80-IA, 80-IB, 80-IC, 80-ID, 80JJAA, 80LA, 92E, 115JB or 115VW​​​​ or to give a notice under section 11(2)(a) shall furnish it electronically on or before the date of filing the return of income.

​Who can use ITR – 1 (SAHAJ)?

Return Form ITR - 1 (SAHAJ) can be used by an individual whose total income includes: Income from salary/pension; orIncome from one house property (excluding cases where loss is brought forward from previous years); orIncome from other sources (excluding winnings from lottery and income from race horses, income taxable under section 115BBDA or Income of the nature referred to in section 115BBE).

​Who can use ITR – 2?

ITR 2 is to be used​ by an individual or an Hindu Undivided Family who is not eligible to file Sahaj ITR-1 and whose income chargeable to income-tax under the head “Profits or gains of business or profession” is in the nature of interest, salary, bonus, commission or remuneration, by whatever name called, due to, or received by him from a partnership firm.

​Who cannot use ITR – 2?

Return Form ITR - 2 cannot be used by an individual whose total income for the year includes income from Business or Profession under any proprietorship.

​Who can use ITR – 3?

Form ITR – 3 can be used by an individual or a Hindu Undivided Family who is carrying on a proprietary business or profession.

GST & OTHERS

What is GST? How does it work?

GST is a tax on goods and services with comprehensive and continuous chain of set-off benefits from the producer's point and service provider's point upto the retailer's level. It is essentially a tax only on value addition at each stage, and a supplier at each stage is permitted to set-off, through a tax credit mechanism, the GST paid on the purchase of goods and services as available for set-off on the GST to be paid on the supply of goods 32 and services. The final consumer will thus bear only the GST charged by the last dealer in the supply chain, with set-off benefits at all the previous stages.

How will GST benefit the small entrepreneurs and small traders?

The present threshold prescribed in different State VAT Acts below which VAT is not applicable varies from State to State. The existing threshold of goods under State VAT is Rs. 5 lakhs for a majority of bigger States and a lower threshold for North Eastern States and Special Category States. A uniform State GST threshold across States is desirable and, therefore, the Empowered Committee has recommended that a threshold of gross annual turnover of Rs. 10 lakh both for goods and services for all the States and Union Territories may be adopted with adequate compensation for the States (particularly, the States in North-Eastern Region and Special Category States) where lower threshold had prevailed in the VAT regime. Keeping in view the interest of small traders and small scale industries and to avoid dual control, the States considered that the threshold for Central GST for goods may be kept at Rs.1.5 crore and the threshold for services should also be appropriately high. This raising of threshold will protect the interest of small traders. A Composition scheme for small traders and businesses has also been envisaged under GST as will be detailed in Answer to Question 14. Both these features of GST will adequately protect the interests of small traders and small scale industries.

How can the burden of tax, in general, fall under GST?

The present forms of CENVAT and State VAT have remained incomplete in removing fully the cascading burden of taxes already paid at earlier stages. Besides, there are several other taxes, which both the Central Government and the State Government levy on production, manufacture and distributive trade, where no set-off is available in the form of input tax credit. These taxes add to the cost of goods and services through "tax on tax" 34 which the final consumer has to bear. Since, with the introduction of GST, all the cascading effects of CENVAT and service tax would be removed with a continuous chain of set-off from the producer's point to the retailer's point, other major Central and State taxes would be subsumed in GST and CST will also be phased out, the final net burden of tax on goods, under GST would, in general, fall. Since there would be a transparent and complete chain of set-offs, this will help widening the coverage of tax base and improve tax compliance. This may lead to higher generation of revenues which may in turn lead to the possibility of lowering of average tax burden.

How will GST benefit industry, trade and agriculture ?

The GST will give more relief to industry, trade and agriculture through a more comprehensive and wider coverage of input tax set-off and service tax set-off, subsuming of several Central and State taxes in the GST and phasing out of CST. The transparent and complete chain of set-offs which will result in widening of tax base and better tax compliance may also lead to lowering of tax burden on an average dealer in industry, trade and agriculture.

How will GST benefit the exporters?

The subsuming of major Central and State taxes in GST, complete and comprehensive setoff of input goods and services and phasing out of Central Sales Tax (CST) would reduce the cost of locally manufactured goods and services. This will increase the competitiveness of Indian goods and services in the international market and give boost to Indian exports. The uniformity in tax rates and procedures across the country will also go a long way in reducing the compliance cost.

How will GST benefit the common consumers?

With the introduction of GST, all the cascading effects of CENVAT and service tax will be more comprehensively removed with a continuous chain of set-off from the producer’s point to the retailer’s point than what was possible under the prevailing CENVAT and VAT regime. Certain major Central and State taxes will also be subsumed in GST and CST will be phased out. Other things remaining the same, the burden of tax on goods would, in general, fall under GST and that would benefit the consumers.

CG TAX SAVING

What incomes are charged to tax under the head Capital Gain?

Any profit or gain arising from transfer of a capital asset during the year is charged to tax under the head Capital Gains

What is long-term capital gain and short-term capital gain?

Gain arising on transfer of long-term capital asset is termed as long-term capital gain and gain arising on transfer of short-term capital asset is termed as short-term capital gain. However, there are a few exceptions to this rule, like gain on depreciable asset is always taxed as short-term capital gain.

A Can I claim deduction of STT from my Capital Gain Income?

No. One cannot enjoy such deduction while computing the chargeable Capital Gains Income. STT will not be considered in both purchasing and selling of securities

In respect of capital asset acquired before 1st April, 2001 is there any special method to compute cost of acquisition?

Generally, cost of acquisition of a capital asset is the cost incurred in acquiring the capital asset. It includes the purchase consideration plus any expenditure incurred exclusively for acquiring the capital asset. However, in respect of capital asset acquired before 1st April, 2001, the cost of acquisition will be higher of the actual cost of acquisition of the asset or fair market value of the asset as on 1st April, 2001. This option is not available in the case of a depreciable asset.

What is the meaning of the term long-term capital asset?

Any capital asset held by a person for a period of more than 36 months immediately preceding the date of its transfer will be treated as long-term capital asset.

Is the benefit of indexation available while computing capital gain arising on transfer of short-term capital asset?

Indexation is a process by which the cost of acquisition/improvement of a capital asset is adjusted against inflationary rise in the value of asset . The benefit of indexation is available only in case of long-term capital assets and is not available in case of short-term capital assets.

Why capital gains are classified as short-term and long-term?

The taxability of capital gain depends on the nature of gain, i.e. whether short-term or long-term. Hence to determine the taxability, capital gains are classified into short-term capital gain and long-term capital gain. In other words, the tax rates for long-term capital gain and short-term capital gain are different. Similarly, computation provisions are different for long-term capital gains and short-term capital gains.

Agreements/POA

What is a Power of Attorney?

There are two kinds of Power of Attorney: General Power of Attorney (GPA)-General Power of Attorney is executed by a person in favour of another to act on behalf of him generally. It may include management of property, Court matter/ litigations, sale of mortgage of property or any other act. Special Power of Attorney (SPA)-Special Power of Attorney is executed to do a particular act. Power of Attorney holder is answerable to the principal and liable to give accounts to him.

Does property get transferred by getting a General Power of Attorney from the person selling it?

Can the agent become owner of property? Ans No. It is wrong to say that ownership is transferred by getting General Power of Attorney. Persons purchasing property must get the sale deed registered. This principle applies to other kinds of transactions also.

Who can execute Power of Attorney?

A person who has attained majority may execute power of attorney in favour of another person who has attained majority including family members like brother, sister, father and mother to act on his behalf. If a power of attorney is executed to sell property in favour of relatives other than those mentioned above, 2 percent stamp duty shall be paid on market value of such property. If a power of attorney is executed in favour of developers, Builders of apartment, Stamp duty shall be paid on market value of such property.

When a General Power of Attorney would get cancelled?

GPA automatically gets cancelled on the death of ExecutantPrincipal (Executant) may cancel it any time.

What does Irrevocable Power of Attorney mean?

If the Power of attorney is executed for consideration in respect of property it cannot be unilaterally revoked, prejudicial to the interest of the agent (See Sec.202 of Indian Contract Act, 1872).

Is it compulsory to register power of attorney attested in India by Magistrate or notary?

They need not be registered. But General Power of Attorney containing authority to present or admit execution of a document executed by the principle is not acceptable for such presentation or admission of execution unless they are attested or authenticated by a Sub Registrar.

LOAN

What is a PIO card?

A PIO card is issued to a ‘Person of Indian Origin’, by the ‘Indian mission’ (Embassy of India / High Commission of India / Indian Consulate) in a foreign country. It extends to the cardholder certain facilities, as prescribed by the Ministry of External Affairs, and is valid for a period of 15 years.

Do I need to be physically present to avail a loan?

You need not be present in India to avail of your Home Loan. In case you are posted aboard at the time of submission of the loan application and disbursement of the loan, you can avail the loan by appointing a Power of Attorney as per any banks format. Your Power of Attorney holder can apply and carry out the formalities on your behalf.

What security will i have to provide to avail of a home loan?

Security of the home loan would generally be mortgage of the property that is financed by us and / or any other collateral / interim security as may be required by us. It is extremely important for you to ensure that the title to the property is clear, marketable and free from encumbrance. There should not be any existing mortgage, loan or litigation, which is likely to adversely affect the title to the property.

Do I get tax benefits on my Home Loan?

Yes. You are eligible for tax benefits on the principal and interest components of your Home Loan under the Income Tax Act, 1961. As the benefits can vary each year, please do check with our Loan Counsellor about the tax benefits that you can avail on your loan.

How is loan-to-value (LTV) ratio relevant for home buyers?

The loan-to-value (LTV) ratio is the term used by lenders to express the ratio of a loan to the value of the property purchased. LTV ratio can be calculated by dividing the loan value to the property value. Before a home loan, lenders do an appraisal of the property against which the mortgage is sanctioned.

How do banks calculate the EMI amount?

Bank generally calculates the EMI amount on reducing interest rate method. The mathematical formula for calculating EMI is EMI = [P x R x (1+R)^N]/[(1+R)^N-1] P stands for the loan amount or principal R is the interest rate per month [if the interest rate per annum is 11%, then the rate of interest will be 11/(12 x 100)], and N is the number of monthly instalments.

Property Purchase TDS

What to check before buying a property in India?

Few points of consideration are under: Property name: The name of property should be clear from issues and the seller should have the required right to sell it, especially if it is inherited or any joint property.No Dues Certificate: Always check that there will be no outstanding electricity/water bills or any other authority dues pending with the property. Take a no dues certificate from the seller at time of purchase.Bank release letter: It is advisable to take the bank release letter from the concerned bank, if the property had been mortgaged as security in any type of loan.Permits: The property of sale should have all approvals and permits from the civic authorities in terms of construction.

What are the taxes that need to be paid at the time of property purchase?

The buyer needs to pay the following taxes at the time of registering the property: TDS or tax deduction at source on amount exceeding Rs 50 lakhs for the purchase of immovable property excluding agricultural land. The TDS must be submitted in the name of the seller.Stamp duty on registrationService Tax is applicable if the property is being purchased from the builder who conceived and constructed the project before offering possession to the buyer. If a ready-to-use property is purchased from the seller then service tax is not applicable.sale proceeds of shares, securities, immovable property or any other asset held in IndiaValue Added Tax (if applicable in the state)

What are the prevailing rates of different property taxes to be paid?

TDS- 1% on the amount exceeding Rs 50 Lakhs Stamp duty depends on the state and municipal laws Service tax- 12.36% if the property is being developed by a builder/developer as a service for buyers.

How is TDS on property calculated?

In terms of calculating the cost on which TDS needs to be calculated, everything paid to the seller in consideration for property is considered i.e. Basic costIDC, EDC, PLCParkingFire-fighting equipmentElectrification, wiring expenses etc.Anything paid to the third parties or other authorities are excludedStamp dutyRegistration feesAny payments to government authoritiesTaxes charged by the builderIn case a ready property is being purchased

What is TDS or tax deduction at source on property?

A new section 194 IA has been inserted in the Income-tax Act, 1961 by the Finance Act, 2013. It provides for tax deduction at source on transfer of certain immovable property other than agricultural land of Rs. 50 Lakh or more.As per this new provision, any person, being a transferee responsible for paying to a resident transferor by way of consideration for transfer of immovable property other than agricultural land, shall at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, is required to deduct an amount equal to 1 percent of such sum as income-tax thereon specially when the value of the immovable property is Rs. 50 Lakh or more.

What are capital gains on property sale?

The income tax rules define gain in two broad categories; namely short term capital gain (STCG) and long term capital gain (LTCG). Any gains arising by selling a property after holding it for 3 or lesser number of years, is short term capital gain. Any gains arising by selling the property after holding it for more than 3 years comes under long term capital gain.For short term capital gain, the capital gain from asset is added to the investorâ??s income and taxed as per the income tax slab they fall under.For long term capital gain, tax liability is determined based on indexed cost of acquisition and improvement. Indexation is a concept, which factors inflation in its calculation by using a factor called cost inflation index (CII).

PROPERTY SALE TDS

What is TDS on property?

The Finance Bill 2013 has proposed that purchaser of an immovable property (other than rural agricultural land) worth Rs 50 lakh or more is required to pay withholding tax at the rate of 1% from the consideration payable to a resident transferor.

How can I use this facility to pay TDS on sale of Property?

The Buyer of the property (deductor of tax) has to furnish information regarding the transaction online on the TIN website. After successfully providing details of transaction deductor can: Either make the payment online (through e-tax payment option) immediately;Or make the payment subsequently through e-tax payment option (net-banking account) or by visiting any of the authorized Bank branches. However, such bank branches will make e-payment without digitization of any challan. The bank will get the challan details from the online form filled on www.tin-nsdl.com

Who is responsible to deduct the TDS on sale of Property?

According to rules in respect of tax deducted at source, buyer of the property would have to deduct the TDS and deposit the same in Government treasury.

I am Buyer, do I required to procure TAN to report the TDS on sale of Property?

Buyer or Purchaser of the property is not required to procure Tax Deduction Account Number (TAN). The Buyer is required quote his or her PAN and sellers PAN.

What if I don’t have the PAN of the seller is it Mandatory?

PAN of the seller is mandatory. The same may be acquired from the Seller before effecting the transaction.

Who is liable to pay? Whose tax will be deducted?

The buyer of the property is liable to pay the TDS within. The deduction will be deducted from the seller for selling of his asset. It had to be paid separately to the government by the buyer.

Which assets are covered u/s 194-IA?

The TDS is applicable to all immovable assets including land, building, all residential venues, all commercial venues, all assets that include land or building, etc. except the land that falls under category of agricultural land.

LEGAL/INHERITANCE PLANNING

Choosing the wrong trustee, executor, or guardian

Many of you haven't created estate documents or updated existing ones because you just can't settle on the fact as to who will act on your behalf. Don't think you'll find the perfect person. That's a sure way to procrastinate indefinitely. Get as close as you can in choosing the right person for each role. And remember, going forward you can always change who is listed in your documents if you find someone better suited to one of these jobs.

Not funding your trusts

If you've gone to the trouble to put trust documents in place, don't fail to retitle your financial accounts and fund your trusts. All this boils down to is a flurry of paperwork. But if you don't do it, your carefully crafted estate plan may be a bust. If you have an irrevocable life insurance trust (ILIT), make sure the policy pays out to the trustee of your ILIT.

Not using the full exemption equivalent credit

The "exemption equivalent credit" is a complicated-sounding term that just means you get to bequeath up to $2 million without paying estate tax. Even if you don't have $2 million, you can still use your exemption to pass whatever you do have to the people or organizations that mean the most to you--free of estate tax. By setting up the credit equivalent trust, up to $4 million (using the credit for both spouses) is free from estate tax.

Failing to equalize spousal estates

A lot of times, one spouse ends up with more of the financial goodies in his or her name. While that may boost an ego here or there, it's actually counterproductive when trying to pass the most assets you can to your heirs.

Not using an ILIT to shelter large amounts of life insurance

We talked about using the exemption equivalent credit to save on estate taxes above. The other common way to manage estate tax is to hold your life insurance policies in an irrevocable life insurance trust (ILIT). Alternatively, if you're in good health, you can apply for a new life insurance policy purchased by the trustee of the ILIT and avoid the three-year waiting period.

Leaving an unorganized mess of financial records

Have you ever had to dig through another person's paper archives for any reason? If so, you know it can be torture. Not to mention the fact that some of your assets may never be found because no one can find the life insurance policy or bank account records. You owe it to your family to be organized.

BANKING & INSURANCE CLAIM

What is a Claim?

A claim refers to the payment made by the insurer to the insured or nominee on the occurrence of an event specified in the contract, in return for the premiums paid by the insured.

What is the claim process?

Following are the three stages of Claims process: Claim Intimation – Intimate us with Death Certificate & submit all the mandatory claim documents.Claim Assessment – Claim documents are scrutinized by the Claims Team and in case of any pending requirements, the same are communicated to the claim beneficiary through a requirement letter. Claims may also be investigated, if necessary.Claim Decision – The claim is approved and then settled. A payment is made to the beneficiary’s bank account by NEFT OR The claim is rejected and a communication providing the reasons for rejection are sent to the beneficiary.

What if Nominee/Beneficiary is minor?

The claim is to be submitted by the Appointee, if any. In case the Appointee is not mentioned, the claim proceeds will be payable to Legal Guardian of the minor or Legal Heirs of the Life Assured, as the case may be, subject to submissions to relevant proof of guardianship or legal heirship.

What if Nominee/Beneficiary has also expired?

If the Nominee has also expired, then the claim may be submitted by the Legal Heir of the deceased Life Assured. However, relevant legal documents like successions certificate and/or legal heir certificate and an indemnity bond are required to be submitted.

REAL ESTATE

What is meant by valuation of property?

The valuation process evaluates the market value of the property. Demand and supply forces operating in the market, as well as other factors like type of property, quality of construction, its location, the local infrastructure available, maintenance, are all taken into consideration before the market value is decided.

How does property valuation help?

Typically, if a real estate agent is asked to judge the value of a piece of property, he would do so based on information of recent sales or purchases of similar properties in that area. Though this may give a fair idea of the property's market value, an official property valuation would carry more weight. E.g. if you need to use this piece of property as a security against a loan, the bank's loan approval process would be faster and smoother if the property is certified by an official valuer. Many banks now insist on valuation certificates before issuing loans using properties as security. The value thus certified may also have chances of getting a higher amount of loan sanctioned. Another benefit of official valuation is that it is a useful negotiating tool when selling the property.

How is its stamp duty decided?

Stamp duty is based on the market value or the agreement value of the property, whichever is greater.

What constitutes conclusion of sale of a property?

An agreement of sale, coupled with actual possession of the property would be considered as a conclusion of the sale. Usually, the entire amount is paid at the time of handing over possession.

What does the term 'Leasehold Property' mean?

When a piece of property is given or 'leased' to an individual (known as the 'Lessee') for a stipulated period of time, by the owner of the property (known as the 'Lessor'), the property is referred to as Leasehold Property. A certain amount is fixed by the Lessor to be paid as lease premium and annual lease. The land ownership rights remain with the Lessor. Transfer of property requires prior permission.

What does the term 'Freehold Property' mean?

When ownership rights for a piece of property are given to the purchaser for a price, that property is referred to as Freehold Property. Unlike in the case of leasehold property, no annual lease charges need to be paid and the freehold property can be registered and / or transferred in part(s).

GOLD & JEWELLERY

How is valuation done and how long does it take?

Valuation is no more complex procedure, we adhere to the latest computerized testing (xrf testing) & acid test in case of silver articles, a basic test can take upto a minute per article.

How do you determine the value of a commodity?

It is very simple : weight of commodity (x) purity percentage (x) buying rate = value (-) tax n service charges = net value

What else will be deducted?

Stones , beads, enamel & melt charges weight if present will be deducted for valuation.

Will my ornaments get damaged due to testing?

No, your ornaments will not get damaged if a computer xref test is performed. However if we feel that a melt test is required then on your approval we will breakdown the ornament into parts and melt it for testing.

What are the documents required for selling gold ornaments?

You must produce 1 photo id & 1 address proof out of the following documents i.e. driving license, passport, ration card, election id, work id, telephone bill, mobile bill, property sale deed.

Once sold can i buy back my ornaments later?

No, we will not be able to re-sell it. As we will be melting it for purification immediately. (please decide before you sell)

PLANTS & MACHINERY

What is the purpose of Plant and Machinery Valuation?

It covers estimation in monetary terms the worth of the plant and machinery in existing use or their contribution to the profitability of the business after considering the market situation or standard of maintenance.

Is the Chartered Engineer a member of Institution of Valuers?

We have the team of qualified valuer for plant and machinery. We are chartered Engineer and fellow member of Institution of Valuers.

How can a valuation report help an individual?

We provide valuation reports for Reputed Banks Insurance and Customs, For Plant and Machinery valuation, it may be required for the following purposes:-- Valuation for loan and mortgage- Valuation for company accounts and financial statement- Valuation for receivership/insolvency- Valuation for merger, acquisition and takeover- Insurance Valuation- Market Value of machinery- Forming part of the continuing business- to remain "in-situ" and- for removal from premises.

What is the role of a valuer?

The role of the valuer is to assess the value of the plant and machinery by conducting a factory floor inspection and detailed survey of all the physical assets so as to record the nature, extent, condition and subsequently to determine the machinery and plant on site as against the register / client's own records.

Agricultural Land

Within how many working days can I receive a valuation report?

We certainly value quality over speed when it comes to something as important as a valuation. Our standard answer to how fast we can provide a valuation is ten (10) business days from when we receive the information we need from the client. We can get it done faster if we are told a specific date we need to hit (e.g. upcoming board meeting). The big caveat in there that many clients do not think about is the phrase, “from when we receive the information we need from the client.” Most clients have the information we request readily available. However, other clients have the information spread between various executives and their outside counsel. So if time is of the essence, getting everything together can speed things up tremendously.

When are the provisions of the Valuation Rules applicable?

The provisions of the Valuation Rules are applicable only when: consideration not in money terms which is either wholly or partly;parties are relevant or supply by any stated category of supplier; andtransaction value is not reliable to be declared.

How much money I need to pay against the valuation?

This is dependent on the individual company and can vary widely depending on the valuation service provider. There are valuation service providers out there that do not have our benefits of scale and technology. They also likely do not benefit from the excellent partners that we have. By working with outsourced CFO services, cap table management services, and other partners we are able to cut significant time out of the process that most providers have to spend in the gathering and structuring of data. So although the price may vary depending on the individual situation, almost certainly companies will get the best possible price/value combination by working with Right Value either through our partners or directly.

How do I choose the actual date for valuation?

By asking some simple questions you can hone in on the right valuation date for your company and specific set of circumstances.

How soon do you need the valuation?

What is the most recent period for which you can provide financials?

If you are funding the business with venture investments, when did you close your most recent funding round?

How does the process of valuation work?

The valuation process is dependent on the situation of the individual company. The general summary is that once a valuation service provider is engaged, the provider will need organizational, financial, and capital structure due diligence that most companies have fairly available without too much trouble. The most difficult tasks are typically either a long-term forecast of financial results or for very early stage companies an analysis of the cost to recreate the IP the company has created.

INTELLECTUAL PROPERTY

WHAT IS THE RATIONALE OF CONDUCTING AN IP VALUATION?

You can have a valuation carried out on your IP assets because of one or more of the following objectives: transactions, litigations support, pricing, tax compliance and planning, strategizing, collateralization as well as financing or securitization.

Are there international standards applied in IP valuation?

Yes. There are five main international standards: Uniform-Standards-of-Professional-Appraisal-PracticeFinancial-Accounting-Standards-BoardInternational-Valuation-Standards-CommitteeInternational-Financial-Reporting-StandardsUS-Generally-Accepted-Accounting-Principles

WHAT FACTORS INFLUENCE THE VALUE OF IP?

There are nine main factors that influence the value of Intellectual Property: market share, emerging technologies, barriers to entry, remnant economic life, legal protection, growth projections, the IP’s profitability and economic and Industrial parameters as well.

WHAT ARE THE MAIN APPROACHES APPLIED IN THE ESTIMATION OF FAIR OR PRINCIPAL VALUE OF INTELLECTUAL PROPERTY?

There are five main approaches that are applied: Cost approachPay off approachMarket approachDirect approachIncome approach Cost Approach: Is essentially based on the substitution economic principle. According to the principle, the cost incurred by an investor in the acquisition of an asset should be equivalent to the cost of obtaining (through construction or purchase) of a substitute asset that has the same utility. The approach can be applied using the historical cost, replication cost, or replacement cost methods. Market Approach: Has a basis on the equilibrium and competition economic principle. According to this principle, in a market that is free and unrestricted, the two forces of demand and supply usually determine an asset’s market price at the point of equilibrium. Direct Approach: Has a basis on the prevailing share value of IP in the applicable Intellectual Property share market. Income Approach: Estimates fair value of IP by discounting economic benefits of owing the IP in future at a recommended discounting rate.

TAX EFILING

What is a return of income?

It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income are communicated to the Income-tax Department. Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. These forms can be downloaded from www.incometaxindia.gov.in

How to file the return of income electronically?

Income-tax Department has established an independent portal for e-filing of return of income. The taxpayers can log on to www.incometaxindiaefiling.gov.in for e-filing the return of income.

Is it necessary to attach any documents along with the return of income?

ITR return forms are attachment less forms and, hence, the taxpayer is not required to attach any document (like proof of investment, TDS certificates, etc.) along with the return of income (whether filed manually or filed electronically). However, these documents should be retained by the taxpayer and should be produced before the tax authorities when demanded in situations like assessment, inquiry, etc. As discussed above, no documents are to be attached along with the return of income, however, in case of a taxpayer who is required to furnish a report of audit under section 10(23C)(iv), 10(23C)(v), 10(23C)(vi), 10(23C)via), 10A, 10AA, 12A(1)(b), 44AB, 44DA, 50B, 80-IA, 80-IB, 80-IC, 80-ID, 80JJAA, 80LA, 92E, 115JB or 115VW or to give a notice under section 11(2)(a) shall furnish it electronically on or before the date of filing the return of income.

What are the different modes of filing the return of income?

The Return Form can be filed with the Income-tax Department in any of the following ways, - (i) by furnishing the return in a paper form; (ii) by furnishing the return electronically under digital signature; (iii) by transmitting the data in the return electronically under electronic verification code; (iv) by transmitting the data in the return electronically and thereafter submitting the verification of the return in Return Form ITR-V;

What are the benefits of filing my return of income?

Filing of return is your duty and earns for you the dignity of consciously contributing to the development of the nation. Apart from this, your income-tax returns validate your credit worthiness before financial institutions and make it possible for you to access many financial benefits such as bank credits, etc.

Why is return filing mandatory, even though all my taxes and interests have been paid and there is no refund due to me?

Amounts paid as advance tax and withheld in the form of TDS or collected in the form of TCS will take the character of your tax due only on completion of self-assessment of your income. This self-assessment is intimated to the Department by way of filing of the return of income. Only then the Government assumes rights over the taxes paid by you. Filing of return is critical for this process and, hence, has been made mandatory. Failure will attract levy of penalty.

NOTICE/SCRUTINY

Do every tax notice makes a demand for some additional tax liability or fines or penal charges?

No, every tax notice does not demand for additional tax. Notices are issued under different sections and every section has some different demand.

Is responding to tax notice necessary in every case?

Yes, responding to tax notice is necessary in every case otherwise you have to face the consequences as stated afterwards.

What are the Consequences for not responding to this communication?

If no action taken by you within 30 days of receipt of the notice u/s 245, the outstanding demand as on that date will be considered for adjustment against your refund.

What are the consequences for non-payment of tax demand?

Non-payment of tax demand attracts penalty and prosecution under various provisions of the Income Tax Act, 1961 and interest @ 1% p.m. or part of the month on the amount of default.

How can TaxAssist help you in responding to tax notice?

TaxAssist has a team of experienced CAs who will get in touch with you and will ensure a proper response to your tax notice and help in resolving the issue.

TDS PROPERTY PURCHASE/SALE

What is tax deducted at source?

For quick and efficient collection of taxes, the Income-tax Law has incorporated a system of deduction of tax at the point of generation of income. This system is called as â Tax Deducted at Source, commonly known as TDS. Under this system tax is deducted at the origin of the income. Tax is deducted by the payer and is remitted to the Government by the payer on behalf of the payee. The provisions of deduction of tax at source are applicable to several payments such as salary, interest, commission, brokerage, professional fees, royalty, contract payments, etc. In respect of payments to which the TDS provisions apply, the payer has to deduct tax at source on the payments made by him and he has to deposit the tax deducted by him to the credit of the Government.

Who is the Payer under section.195?

Under section.195 all the payers are covered irrespective of their status like Individual, HUF, and Firm & Corporate etc. So all the payers are responsible to deduct TDS under this section if they are making payment to non resident as per prescribed conditions.

Who is the payee under section 195?

Under this section all the payees are covered whether Individual or Corporate or any other status. So making payment to non resident, not being company or to a foreign company covered under payee if they meet the non resident status under section.6 of the Income tax act.

Which payments & expenses are covered under sec.195?

As per this section any interest (not being interest referred to in section 194LB or section 194LC or section 194LD) or any other sum chargeable under the provisions of this Act (not being income chargeable under the head â Salariesâ??). So following payment not required TDS deduction under this section a. Interest referred under sections.195LB/LC/LDb. Salary paymentc. Dividend payment u/s.115-O Above payments are exclude under this section from TDS deduction and all other payments are covered under this section. But payment against import is not comes under purview of TDS.

When to deduct the TDS?

TDS has to be deducted at the time of credit or payment whichever is earlier. Crediting which means even crediting in suspense account or any other name called considered as deemed to be credited, accordingly the TDS will apply.

REPATRIATION 15 CA/CB, RBI/IT

What is meant by Remittance of Assets?

'Remittance of assets' means remittance outside India of funds representing a deposit with a bank or a firm or a company of: Provident fund balanceSuperannuation benefitsAmount of claim or maturity proceeds of Insurance policySale proceeds of shares, securities, immovable property or any other asset held in India

What are the Tax implications in respect of remittance of assets?

All remittances are subject to payment of taxes as applicable in India â?? Authorised Dealers are to convince themselves on this aspect.

Can I repatriate money out of balances held in my NRO accounts?

Interest earnings can be repatriated. In addition to this, remittance/s up to USD 1 million per calendar year from balances in NRO accounts subject to payment of applicable taxes is allowed for any purpose up to an aggregate value of USD 1 million: The documents required to be produced for effecting a remittance are: Account holder's Letter giving details of purpose of remittance and certifying the sameCheque or debit authority if the same is not contained in the letter in item (i)Application in Form A2A certificate from a Chartered AccountantFEMA Declaration to be filled in by the NRI

Can I repatriate money from my Property and Investment Income?

All forms of current income arising out of investments in India are repatriable. This includes income by way of interest, dividends, rentals, etc. Current income is repatriable even if the asset generating the income itself is not. There is no ceiling on the value of such remittances and the amounts are remitted out of the NRO Account based on the following documents: The documents required to be produced are: Account holder's Letter instructing the remittanceCopy of document/s establishing the inheritance and value of proceeds credited to the NRO accountChartered accountant's certificate in the format prescribed by IT authoritiesCheque or debit authority if the same is not contained in the letter in item (i)Application in Form A2

Can funds in NRE/NRO accounts be repatriated outside India?

NRE accounts - Yes. NRO accounts -(1) Current income like rent,dividend,pension,interest etc.(2) Remittance upto USD 1 milion per financial year(apr-march) for all bonofide purpose to the satisfaction of authorized deals banks.

Are funds in FCNR accounts freely repatriable abroad?

Yes.

LEGAL

BUSINESS ENTITY INCORPORATION

What is meant by Business entity?

The organizations that are incorporated for the purpose of doing business and profit are termed as business entities. They can either incorporate or unincorporated. The tax liability is calculated as per the type of the company.

What Is the Difference Between Incorporated & Unincorporated Businesses?

An incorporated business, or a corporation, is a separate entity from the business owner and has natural rights. Conversely, a business owner and an unincorporated business are the same, and the owner personally bears all results of the business.

What are the types of Business entities in India?

There are following types of business entities in India:Private Limited CompanyPublic Limited CompanyUnlimited CompanyLimited Liability Partnership (LLP)PartnershipSole ProprietorshipLiaison Office / Representative OfficeProject OfficeBranch OfficeJoint Venture CompanySubsidiary Company

What are the advantages of incorporating in India?

Following are the advantages of incorporating a company in IndiaMany tax exemptions available to the company set up in Special Economic Zone;Many tax incentives available to IT companies;India has got double taxation treaties with many countries;Minimum authorized capital of only INR 100,000 (US $ 2250 approximately) is required to form a private company in India;Skilled and intelligent employees available at nominal rate;With its large base of English speaking skilled human resource, it is most sought after destination for business process outsourcing, Knowledge processing etc.

PUBLIC LIMITED COMPANY

What are the Primary Requirements for setting up a Public Limited Company in India?

For setting up a public limited company anywhere in India, there are required a minimum of Seven Shareholders and Three Directors; the directors can also be shareholders.

Can an NRI/Foreign National be a director in Public Limited Company? What are the conditions for the same?

Yes, an NRI or Foreign National can also be a shareholder or director in a public limited company of India. For becoming a director, besides the basic requirement of being a sensible adult, such a person must possess the DIN issued by MCA.

What is a Public Limited Company?

The Public Limited Company is a wider form of the limited company, which has no restriction on the maximum number of shareholders, listing its shares in the stock market, transfer of shares, and raising funds from public and accepting public deposits; all of these activities cannot be done by a private limited company. Again, unlike a private limited company, a public limited company is governed and managed by a Board of Directors constituted as per the unanimous consent of the shareholders.

What are the Liabilities of Public Limited Company?

As a public limited company deals with public money, it has to make rather heavy compliances strictly, which are bulkier than those performed by a private limited company. Apart from the regular compliances related with income tax, there are much periodic and annual compliance to be made by a public limited company with ROC/MCA, SEBI, RBI, etc. These regulatory liabilities are in addition to securing and promoting steadily the profits and welfare of all shareholders of the public limited company.

PRIVATE LIMITED COMPANY

How many shareholders constitute a Private Ltd company?

The minimum number of shareholders required for incorporating a Private Ltd company is two. The maximum number of shareholders allowed is 200, and the shareholders can be natural persons or companies (Indian and Foreign).

What are the basic documents required for registering a Pvt Ltd?

Documents required are identity proof and address proof of all proposed directors along with PAN card. If the premises on rented property an NOC from landlord with his id and address proof is also required. MOA and AOA are also required.

What is the quantum of capital required to start a Pvt ltd?

The minimum capital requirement for setting up a Private limited company is INR 100,000. This is the minimum starting capital with no upper limit specified in the companies Act.

Does a Private limited company require an office to operate?

In India the minimum requirement for a private limited is a registered office. The office may be a commercial place, industrial location, or residential accommodation where the letters and other communication from MCA can be delivered.

How much time is required to incorporate a PVT Ltd in India?

The average time taken for incorporating a Pvt Ltd company in India is 2 to 4 weeks. The time of registration depends on two factors viz. Submission of the relevant documents and the speed of approvals. Choosing a unique name and having all documents in place helps in quicker incorporation.

How to expedite the incorporation?

The process of government approval takes minimum 2 weeks but you can ensure it takes no more time by having all the documents signed and verified before putting in the application. Choosing a unique name for the company also helps because then your application will not be rejected for similar names.

CO-OPERATIVE HOUSING SOCIETIES

Who is the Competent Authority for approving the membership of a Cooperative housing society?

In terms of Section 64 (1) of the WBCS Act, 2006 read with Rule 108 of the WBCS Rules, 2011, the Board of Directors is the competent authority in this regard.

What an intending applicant can do on being refused by the society in considering his membership?

He may appeal to the Registrar in terms of Section 64 (3) of the WBCS Act, 2006 and the Registrar will conduct hearing in terms of Section 64 (4) ibid read with Rule 110 of WBCS Rules, 2011.

Can a Cooperative Housing Society raise fee or donation from the transferor member?

A cooperative housing society cannot charge transfer fee from its transferor-member.

Can a cooperative housing society change the scheme of the project?

Change should be approved with three-fourth majority in a GBM with prior consent of the Registrar.

VALUATION

REAL ESTATE VALUATION

What is meant by property valuation?

Property valuation means conducting the survey of the property and includes information like rates, size of the land and building, physical details on the construction and condition of the dwelling. It can be requested by the property owner by a valuation expert or done by a financial institution while granting a loan in lieu of the property.

When is property valuation required?

A property valuation may be required when:Taking a loan and using the property as security.Refinancing the said property known as loan against property (LAP).While selling a house or making an offer to sell

What is a property valuation report?

A property valuation report is a written document professionally written to show the value of a property. It considers all the factors that affect the value of a property. Different valuation experts have different methods but all leads to the value of the property.

What is rating Valuation and how is it different from Property valuation?

Rating Valuations (RVs) are compiled by statute, under the Rating Valuations Act 1998, mainly as a uniform basis for levying local authority and regional council rates. It does not have a bias as compared to property valuation done by private valuators.

GOLD & JEWELLERY VALUATION

What is the need for valuation of Gold and jewellery?

The three main reasons for valuation of gold and jewellery are:To know your net worth in the current year.For wealth tax calculation purpose in a financial year.For insurance replacement.Also done for probate, division and replacement in case of loss.

What due diligence should be followed while buying gold and jewellery?

When you buy jewellery you should keep in view the following points:Buy from a store that is well known.Always get the jewellery weighed and take the receipt.Get the certificate for how much precious metal or gems are in the jewellery.Ask for a manual of the safety precautions that need to be taken while storing.

Who can do the valuation of your gold and jewellery?

Valuations should be done by certified institutions who are experts in doing gold and jewellery valuation. The reason for this is the required expertise while doing the valuation of the jewellery and also the experience. The certified institutions have experienced people with requisite knowledge of the trade as well as they are acceptable as a standard.

Do values vary with time and place?

The value of jewellery does vary from place to place and time to time depending on the value of the precious metals and gems and their value in a particular country or region. The valuation when you are ready to sell the jewellery may be different from the valuation of the jewellery done when you are taking an insurance.

PLANT & MACHINERY VALUATION

What is meant by plant and machinery equipments?

The assembled asset that may include specialized buildings, machinery and equipment is called a plant while an asset that is used to assist the function of an enterprise is termed as machinery.

Who can do a plant and machinery valuation?

A plant and machinery appraiser need not have a certificate or license. The only thing required to do the task is to have specific experience of the task at hand.

Why is valuation of machinery and plant done?

The valuation of plant and machinery is done majorly for two purposes:For selling or exchange of plant and machinery.To know the value of asset after depreciation for accounting purpose.

Can the valuation of plant and machinery be used for capitalization?

Though the valuation of plant and machinery is primarily done for sale it can also be done for knowing the present value. However, the valuation cannot be used to capitalize or for the issue of bonus shares to the shareholders.

AGRICULTURAL LANDS VALUATION

What is meant by agricultural land?

Agricultural land is land typically meant for agriculture and systematic rearing of livestock. Rural agricultural land has been excluded from capital Asset categorisation as per Section 2(14). Non-rural agricultural land on the other hand is classified as Capital Asset and the definition of non- agricultural land is specified on page 13 of the Finance bill 2013.

Is profit from sale of rural agricultural land taxable?

Agricultural land in rural areas is not classified as capital assets and hence the capital gains arising out of its sale is not taxable. If all specified parameters prescribed in the income tax law pertaining to the same are satisfied then the sale does not attract any tax. But you will have to show the amount in Exempted Income head while filing the return for the financial year.

What is the capital gain tax applicable to non-rural agricultural land?

Non-rural agricultural land is specified as capital asset and hence it will be subject to taxation in a similar manner as other property in case of capital gain from sale. Thus the capital gain is calculated by deducted the price and improvement cost from the sale proceeds.

What is the significance of Section 54B in exemption in tax?

Section 54B is specifically for exemption from tax in case of capital gain from non rural agricultural land. The exemption specifies that the sale proceeds should be used for buying another agricultural land in a time band of two years.

NRI SERVICES

PROPERTY SALE AGREEMENTS

What is meant by a sale deed?

A sale deed is a document which transfers the ownership of immovable property like land, house, flat, office to another person. A sale deed registration is compulsory for sale or resale of immovable property. Only in some states resale is exempted from deed registration in existing co-operative societies. All the sales attract stamp duty which varies from state to state. The duty depends on variables like location, age of building and type of unit.

What is a title deed?

A document that proves that an immovable property belongs to a person is called title deed. Property can be acquired by various means and after paying the stamp duty and registration the executed document which is a proof of the transaction is the title deed. A sale deed, release deed, relinquishment deed, gift deed, family settlement deed, partition deed or a will are all the evidence of acquisition of immovable property and are all called title deeds.

How is inherited property by NRI treated?

A property acquired by inheritance is possible only when you are a resident of India. In such cases where the property is acquired by NR when he/she was resident does not need approval of the RBI for sale or refurbishment. However, if you are currently non resident then selling the property requires approval of RBI.

What is meant by capital gains on sale of property?

Any gains arising out of sale of property qualifies as capital gains on property. If the property is sold after 3 years the capital gains are treated as long term and if the property is re-sold within 3 years then the capital gain related to property is treated as short term as per Income Tax rules.

What are the documents that you require to verify while registering?

You need to check that you have the following documents:Plans approved by the civic authority.Title certificate of the current date from an Advocate.IOD/ commencement certificate copy.Receipt of payment of stamp duty.DD for paying the fees of registration.Property card that shows the CTS number.PAN card of seller and buyer.Khata extract.

What is the due diligence required before buying a property in India?

Some of the points that need to be verified are:The name of the property is clear.No dues certificate if a joint property.Bank release certificate if the property has been mortgaged as security.Approvals and permits from the civic authorities.TDS certificate for above 50 Lakh immovable properties excluding Agricultural land.Receipt of requisite stamp duty on registration.Goods and services tax receipt for property as per the norms.

REPATRIATION

What does Remittance of Assets mean?

When you remit funds outside India from a deposit with a bank, firm or a company it is known as Remittance of Assets. It may consist of PF balance, superannuation benefits, and maturity proceeds from an insurance policy or sale proceeds of immovable property, shares or any other assets held in India. Can the funds in NRE and NRO account be repatriated? The funds from NRE account can be freely repatriated. NRO accounts only allow repatriation of current income items like rent, dividend, pension and interest. The limit to the total remittance is limited to USD one million every financial year for all purposes and should comply with bank rules.

What documents are required for remitting money from NRO account?

The documents required while repatriating funds from NRO account are: A letter from account holder specifying the purpose of remittance.Cheque or debit authority should accompany the letter.A complete Form A2 which can be had from the bank.A certificate from a chartered accountant.FEMA declaration needs to be filed and a copy attached.

Can the property and investment income be repatriated?

All kinds of current income which includes investments in India can be repatriated. This includes all incomes from interest, dividends, and rentals. Though the asset generating income may not be repatriable the income arising out of it is indeed repatriable. There is no upper ceiling on these amounts after paying the proper taxes which are due. The limit is only for the NRO account which is USD 1 million during a financial year. For NRE account there is no upper limit once the taxes are paid to the satisfaction of the banking authority. The documents required at the time of remittance are same as in the above case.

What are the taxes that need to be paid before remittance?

The taxes that are due as per the Income Tax laws and the laws governing other incomes have to be paid in full before repatriation of funds.

What is an FCNR account?

FCNR account holds foreign currency in fixed deposits and the deposits can be made in many foreign currencies. The funds in these accounts are freely repatriable.

PROPERTY PURCHASE AGREEMENTS

What is the due diligence required before buying a property in India?

Some of the points that need to be verified are:The name of the property is clear and no dues certificate if a joint property.Bank release certificate if the property has been mortgaged as securityApprovals and permits from the civic authorities While buying property and registering it, you will need to pay the following taxes:TDS for above 50 Lakh immovable properties excluding Agricultural land.Requisite stamp duty on registration.Goods and services tax for property as per the norms.

What is meant by a sale deed?

A sale deed is a document which transfers the ownership of immovable property like land, house, flat, office to another person. A sale deed registration is compulsory for sale or resale of immovable property. Only in some states resale is exempted from deed registration in existing co-operative societies. All the sales attract stamp duty which varies from state to state. The duty depends on variables like location, age of building and type of unit.

What is a title deed?

A document that proves that an immovable property belongs to a person is called title deed. Property can be acquired by various means and after paying the stamp duty and registration the executed document which is a proof of the transaction is the title deed. A sale deed, release deed, relinquishment deed, gift deed, family settlement deed, partition deed or a will are all the evidence of acquisition of immovable property and are all called title deeds.

How is inherited property by NRI treated?

A property acquired by inheritance is possible only when you are a resident of India. In such cases where the property is acquired by NR when he/she was resident does not need approval of the RBI for sale or refurbishment. However, if you are currently non resident then selling the property requires approval of RBI.

What is meant by capital gains on sale of property?

Any gains arising out of sale of property qualifies as capital gains on property. If the property is sold after 3 years the capital gains are treated as long term and if the property is re-sold within 3 years then the capital gain related to property is treated as short term as per Income Tax rules.

LOAN

What is a PIO card and who gets it?

A PIO card is for signifying that a person is of Indian origin. This card is issued by Embassy of India, Indian High Commission or Indian consulate in a foreign country. The person holding a PIO card has certain facilities the major one being not being required to get a visa. There are certain other facilities that are extended and the card is valid for 15 years from the date of issue.

Is personal presence necessary for availing a loan in India?

Your personal presence may not be required for availing home loan. In the case of being abroad when the application for loan is submitted and also at the time of disbursement, you can avail the loan by providing the Power of Attorney as per the concerned Bankâ??s format. The holder of the Power of Attorney can carry out the formalities on your behalf.

Is tax benefit applicable on home loans for NRIs?

Under the Income Tax Act, 1961 everyone taking a home loan is eligible for tax benefits on the principal and interest components of the loan. The tax benefits can vary from year to year depending on the regulations. Hence you need to check with your counsellor on loans about the benefit on tax that you can avail.

What is the relevance of LTV for home buyers?

LTV which expands to Loan to value is the ratio calculated expressing loan to the value of the property. It is calculated by dividing loan value in INR to property value in INR. Before the loan is given the appraisal of the property is done and the amount of loan sanctioned is as per the Loan to Value ratio.