Come January, and the salaried class has to worry about submitting proofs of investments to their employer. This trickles down to finding the right investment which will help them to save the maximum possible tax.
While it is imperative to invest for saving tax, it is equally important to invest keeping in mind other factors like lock in period, liquidity, risk & return etc. However, given the myriad of options, it can be quite difficult for an investor to be aware of the features that each option offers.
In this article we have listed the tax saving instruments, their features and other important information which will help you in taking an informed decision.
So was the situation of many people in India. Here we try to give answers to the questions that Mr. Friday and many such people face of demonetization.
1. Demonetization has been a surprise move. Who should be worried?
Everybody who has cash in hand of denominations Rs. 500 and Rs. 1,000 will be affected and should be concerned. However, you should be worried if such cash is disproportionate to your income. Further, you should be worried if such cash was not declared in your IT returns as income.
2. I have more than Rs. 2.5 lakhs with me. Will tax and penalty be levied on the deposit?
Rs. 2.5 lakh limit implies that the government will not question any deposits, post demonetization, within this limit. It doesn’t mean that any deposits above this limit will attract tax and penalty automatically (as popularised in social media). Such deposits will be questioned, and a substantiating justification supported by IT returns will save you.
It might sound strange, but seems pretty logical. People may quite skilfully hide the income from the government, but this has to be spent somewhere. Foreign trips are among the most popular to splurge that hidden money. While the government can’t see what has been spent directly, the IT officials seem intelligent and tech savvy enough to find what a person has spent through social media profiles. The government already has an official directive to report foreign travels. Last year, government proposed some amendments forcing foreign travel and expenses to be reported during return filing. However, the same has been rolled back due to the opposition from public. The initiative of social media scan was no where officially declared, but reliable news houses claim this through an interview with an IT assessing officer. The pictures or information on Facebook doesn’t give any legal proof though and the assessment cannot be based on the information found there. This, the officer apparently claims to give information to question. If this goes true, nothing stops them from understanding the financials from the posts about new car purchases, or those shopping bags you flaunt. So, watch out for those special likes and comments, looks like even Facebook walls have ears!!
Why is it free?
We operate on Freemium model. All our essential and basic services are completely offered for free while our premium services are charged. We do not charge for services which are totally automated, we charge only for services where our experts spend their time like expert filing/ IT notice advice.
Now, freemium is not a new concept. You see it everywhere – Facebook doesn’t charge to use the regular account, but charges for the business users to advertise. Other IT return providers give return filing for income below 5 lakhs as free and charge for return filing above that. Or similar conditions.
It all boils down to what the business thinks can afford as basic. We think the whole of return filing is for free and we intend to role out a whole bunch of premium services in the future and wish to gain your confidence through this product. Worry not, our data protection policies, adherence to the acts, e-return intermediary affiliations all speak for the safety and security of the data!