Invest in their name if they are in a lower tax bracket: Every adult enjoys a basic tax exemption limit. For senior citizens (above 65 years), the basic exemption limit is Rs 2.4 lakh a year. If any or both of your parents do not have a high income but you have an investible surplus, you can avoid tax by transferring money to them which can then be invested in their name. There … [Read more...] about Tax Saving with the help of parents
Retirement planning through dividends
View quick summary Dividend is tax free in individual’s hands but it is not regular. If you have surplus funds, you should invest them in mutual funds and get tax-free income from dividends. For emergency funds requirement you can sell a part of your portfolio, money gets credited in your account within 2 days. The risk of investment in equity versus keeping in fixed deposit … [Read more...] about Retirement planning through dividends
Ownership and possession must to claim deduction
View quick summary Ownership and possession is a must to claim deduction on home loan interest: You have to report income/loss from property ONLY if you are the owner of that property. An owner is a person who owns the legal title of the property and has the right to receive income from it. Solely Owned Property: If you are the sole owner of a property, then you should report … [Read more...] about Ownership and possession must to claim deduction
Safeguards from clubbing of minor income
View quick summary You have to declare and pay tax on your child's income within your income tax return. In case your minor child is earning from his/her own capacity, then the minor child can file his/her own return and there will not be any clubbing of income. To avoid clubbing of your child’s income, you may invest in tax free instruments such as PPF, MF or ULIP. Plot and … [Read more...] about Safeguards from clubbing of minor income
Take a home loan and get insured
View quick summary We have tried to enlist some guidelines that you need to consider while borrowing for a house. Generally, you should not borrow above 50% of your take home salary. The other monthly payments such as insurance premium must be deducted while calculating repayment capacity. You also need to consider the tax benefits of home loan and the rate of interest on home … [Read more...] about Take a home loan and get insured
