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Old 6th March 2012, 20:48   #256
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Ramzys
Hi
IDBI is offering FD tenure of 10 years with no foreclosure penalty if kept for more than a year.Recheck with them.
If he is a senior citizen then the interest is more.
In the current high interest rate scenario to lock in for 10 years is a good thing.
Regards
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Old 22nd July 2012, 19:34   #257
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I wanted to understand the tax laws when it comes to gifts. My dad is a senior citizen and receives pension. My dad had constructed a house several years ago and recently gifted it to me. He used to show the rent received as income and pay taxes on this amount so far. The chartered account who does my parent's returns says that the rent received (now by me) can be gifted to my dad without any tax implications to either of us. I checked several articles online and can't seem to get a scenario like mine. As far as I've read, gifting the rent to my dad would not need to be considered as income for him. I'm in the highest tax bracket. How does this affect me? Do I have to declare the rent and pay taxes?

Here are some articles I found
Would appreciate your advise.
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Old 22nd July 2012, 20:22   #258
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Originally Posted by ramzsys View Post
My dad is about to retire(government employee) and is receiving some 25 lakh rupee. In the current investment scenario, where can it be parked in?

PS: He would be comfortable about not investing in the share market(direct/indirect) because of past experiences.

Bhpians, kindly guide.
Hi my dad has done FD at IOB, and gets monthly interest, every month just like post office.
Will advise to check their branch/website.
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Old 23rd July 2012, 21:17   #259
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Hi my dad has done FD at IOB, and gets monthly interest, every month just like post office.
Will advise to check their branch/website.
Yeah!

There's investment required for agriculture but past investments in that side has returned 300% loss.

So don't want to scald the hands anymore. Dad maintained his account in IOB and he too invested in FD in the same bank.
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Old 6th August 2012, 20:53   #260
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I am about to open PPF account for wife and daughter with ICICI bank.

Any pointers rgd this? Any advantages over opening with a nationalised bank?

Rgds.
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Old 6th August 2012, 21:50   #261
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Originally Posted by triedeverything View Post
.......... that the rent received (now by me) can be gifted to my dad without any tax implications to either of us. I checked several articles online and can't seem to get a scenario like mine. As far as I've read, gifting the rent to my dad would not need to be considered as income for him. I'm in the highest tax bracket. How does this affect me? Do I have to declare the rent and pay taxes?...
Gifts within the family/ Relatives ("Relative" as defined under the Income Tax Act, 1961) is fully exempt from tax in the hands of the receiver. In your case, the rent amount given as gift to your dad should be fully exempt for your dad.

You may have to show rental income in your account and pay taxes on it after availing permissible deductions as provided in the statute. Once it is done, the gifting part to your dad can be done without any monetary restriction/ tax implication.

But just make sure that the House property gifting transaction from your dad to you does not attract any deeming provision which would treat your dad as the owner of the house property despite gifting it to you, on the premise that the transaction was carried out to avoid/ reduce your dad's tax liability.

If the above part is clarified then the gifting rent part is pretty straightforward!

Last edited by Warwithwheels : 6th August 2012 at 21:52.
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Old 7th August 2012, 08:14   #262
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Originally Posted by sindabad.sailor View Post
I am about to open PPF account for wife and daughter with ICICI bank.

Any pointers rgd this? Any advantages over opening with a nationalised bank?

Rgds.
I was under impression that PPF can only be opened at SBI. Have they changed this now? IMO you should stick with SBI for PPF.
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Old 7th August 2012, 08:40   #263
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I was under impression that PPF can only be opened at SBI. Have they changed this now? IMO you should stick with SBI for PPF.
PPF accounts can now be opened with several banks. This 'second-mover' advantage has given these banks some valuable lessons and they are providing better facilities to their customers/depositors with regards to such investment options. Like for eg. you can operate your PPF account with ICICI bank just like you operate your savings or current account. It's online and mobile friendly, that lets you track your investments better. And you're not losing out on interest either as interest rates for PPF are determined by the finance minister.

AS of now, you can only make online deposits to your SBI PPF account. You cannot do any other online or ATM transaction with the same. That means, you still have to personally visit your bank branch to get your passbook updated. Things will change, but there's still a long way to go.
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Old 7th August 2012, 08:47   #264
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PPF accounts can now be opened with several banks. This 'second-mover' advantage has given these banks some valuable lessons and they are providing better facilities to their customers/depositors with regards to such investment options. Like for eg. you can operate your PPF account with ICICI bank just like you operate your savings or current account. It's online and mobile friendly, that lets you track your investments better. And you're not losing out on interest either as interest rates for PPF are determined by the finance minister.

AS of now, you can only make online deposits to your SBI PPF account. You cannot do any other online or ATM transaction with the same. That means, you still have to personally visit your bank branch to get your passbook updated. Things will change, but there's still a long way to go.
Thanks. Actually SBI also offer similar service. My SBI PPF account is linked with the SBI Savings account and I can manage it online. Its similar to what you have mentioned for ICICI. A quick online transfer is possible from saving a/c to PPF account.
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Old 7th August 2012, 08:54   #265
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To open a PPF for minor in SBI, my wife needs to open up an S/B a/c there. I do not wish to open one more a/c for her.
Also the SBI experience is not worth. Unfortunately the bank caters to a huge population of pensioners. Sometimes beginning of the month it is difficult to make an entry in the branches around. Hence not considering SBI.

Quote:
I was under impression that PPF can only be opened at SBI. Have they changed this now? IMO you should stick with SBI for PPF.
In fact PPF a/c could be opened up at any nationalised bank till now. Mine is with BO Mah for over 10 yrs now. The easiest way for the masses was post office. But the near stone age way of working makes it extremely unattractive.

Anyways opening one with ICICI today.
Heard that the PPF a/c can be transferred to any other bank. Hence if ICICI causes pain, then would transfer the same to some other bank in future.
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Old 8th August 2012, 16:20   #266
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Heard that the PPF a/c can be transferred to any other bank. Hence if ICICI causes pain, then would transfer the same to some other bank in future.
Can you please elaborate on that? AFAIK, you can transfer your PPF account only between branches of the same bank. Not aware about this facility whereby it can be transferred to a different bank altogether. If yes, I would pleasantly do so by shifting mine and my wife's PPF account from SBI to ICICI.
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Old 12th August 2012, 17:57   #267
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Hello Financial Gurus, i have just started my career and would like to invest around 15k a month in total for the next 12-18 months. I am thinking of investing 5k per month into SIP and 5k into a tax saver mutual fund while the third 5k will most probably go into a PPF at ICICI bank. Is this a good spread of investments?. Also, I will be paying a rent of around 4000 INR per month which amounts to 48000 for the year so will this amount be usefull for tax deductions. If yes then how much?

Also, let me know how do i start getting to know about various investment options and how to evaluate them? Should i approach a CA/expert?
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Old 12th August 2012, 19:28   #268
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I will be paying a rent of around 4000 INR per month which amounts to 48000 for the year so will this amount be useful for tax deductions. If yes then how much?
Firstly, congratulations on the new career!

The recommendation on savings is that you save approx 30% of your gross income. Calculating the actual benefit on claiming rent is not as straightforward as you'd expect. See if you can makes sense here. Try using this site to find out what part of your rent can be actually deducted from your taxable income.
HRA CALCULATOR (EXEMPTION -HOW TO CALCULATE) | SIMPLE TAX INDIA

I'm not a tax expert. But I think you should also invest in medical insurance. Depending on the tax bracket you fall in, you can not only save more than the 100k that you invest in, but can also ensure that medical emergencies don't destroy your financials. Remember to cover your parents too as section 80D offers additional savings for policies taken out for your parents. Remember, this is advisable in addition to any corporate medical insurance you may have. There are policies that cover you beyond what any employer will (age and amount). These are cleverly thought of policies that are partially invested in equity so that after a period of time, they start to pay for themselves.

Disclaimer: I' don't deal with any kind of insurance. I'm just another bloke who wished someone advised me about medical insurance and investments when I started my career.

Last edited by triedeverything : 12th August 2012 at 19:29.
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Old 15th August 2012, 14:22   #269
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@triedeverything

That takes care of the HRA amount for tax saving. Any idea about which mutual funds/ Fd's to go to considering a part of investments are for long term while a part of it is short term.
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Old 22nd August 2012, 10:40   #270
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Quote:
Quote:
Originally Posted by sindabad.sailor
Heard that the PPF a/c can be transferred to any other bank. Hence if ICICI causes pain, then would transfer the same to some other bank in future.
Can you please elaborate on that? AFAIK, you can transfer your PPF account only between branches of the same bank. Not aware about this facility whereby it can be transferred to a different bank altogether. If yes, I would pleasantly do so by shifting mine and my wife's PPF account from SBI to ICICI.
My father used to be transferred every couple of years across that state. Recently he mentioned that few times he had his PPF a/c transferred inter-bank as there were no branches of earlier banks nearby then. Would ask him again in detail today.
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