[bejoy]

Is there any change to the way the Form 26AS is viewed from Incometax efiling website? Earlier I could just visit the TRACES website with direct link from the IT eFiling website, but now it is asking for a separate TRACES login.

[sunilch]

Originally Posted by binand

4. The big one you miss is home loan. The entire interest you pay on home loan is deductible from the rent you earn. A smaller one is that the property tax you pay is also deductible.

Wasn't this offsetting of the interest capped at 2L?

https://www.charteredclub.com/tax-benefit-on-home-loan/

[raksrules]

Originally Posted by binand

4. The big one you miss is home loan. The entire interest you pay on home loan is deductible from the rent you earn. A smaller one is that the property tax you pay is also deductible.

Thanks for the clarification. I don't have Loan anymore as it is paid off completely so cannot avail that. But I had read somewhere that if say I have not available benefit of loan payment in my previous ITR, I can probably claim now?
Is that true?

On a related note, the flat is co-owned by my wife (my name is first if that matters). So any chance I can tell tenant to start transferring rent to her and it comes under her income rather than mine. I am guessing answer is No but still asking.

[binand]

Originally Posted by sunilch

Wasn't this offsetting of the interest capped at 2L?

For properties that are rented out, there is no limit. See the section "Deduction for Non-Self Occupied Property" in the article you referenced.

In case of non-self occupied property, the interest paid is reduced from the Rent paid to arrive at the Income from House Property. In some cases, it may happen that the Interest paid is more than the Rent earned which will result in Loss from House Property. This Loss is allowed to be set-off with Income from any other head.

Originally Posted by raksrules

Thanks for the clarification. I don't have Loan anymore as it is paid off completely so cannot avail that. But I had read somewhere that if say I have not available benefit of loan payment in my previous ITR, I can probably claim now? Is that true?

Don't think so. Such a view might violate the principle that income you earn and cost of earning that income both need to be accounted for in the same financial year. There might be specific scenarios where this might hold true, if you have doubts best to consult a tax practitioner.

Originally Posted by raksrules

On a related note, the flat is co-owned by my wife (my name is first if that matters). So any chance I can tell tenant to start transferring rent to her and it comes under her income rather than mine. I am guessing answer is No but still asking.

What I do is to treat the two of us (self and wife) as 50% owners, and both of us declare 50% of the rent as income. I'm not sure if you can show the entire rent as only your wife's income when you are actually listed as an owner of the property.

[thanixravindran]

Originally Posted by raksrules

Thanks for the clarification. I don't have Loan anymore as it is paid off completely so cannot avail that. But I had read somewhere that if say I have not available benefit of loan payment in my previous ITR, I can probably claim now?
Is that true?

On a related note, the flat is co-owned by my wife (my name is first if that matters). So any chance I can tell tenant to start transferring rent to her and it comes under her income rather than mine. I am guessing answer is No but still asking.

1. This is true to the extent, if it is not claimed in the previous year, you can set it off in the subsequent year but against only against the income from that house property. Refer this - https://www.charteredclub.com/loss-from-house-property/

2. If your house registration document does not specify the share between you and your wife, by default, IT calculation is taken as 50% share each. However you can make a declaration that you are giving up your share and your wife is eligible for 100% loss/gain from the property depending on who is in the higher tax bracket. Please note the loan should also be joint loan in this case.

PS: I am not a CA, so please consult a CA for professional advice.

[raksrules]

Originally Posted by binand

What I do is to treat the two of us (self and wife) as 50% owners, and both of us declare 50% of the rent as income. I'm not sure if you can show the entire rent as only your wife's income when you are actually listed as an owner of the property.

I would ask my CA about this 50% income from flat for myself and wife and see if this is possible to do. Thanks for that idea. Even that can help me reduce my tax liability as wife is homemaker and her income is from interest and capital gains and all.

Originally Posted by thanixravindran

1. This is true to the extent, if it is not claimed in the previous year, you can set it off in the subsequent year but against only against the income from that house property. Refer this - https://www.charteredclub.com/loss-from-house-property/

2. If your house registration document does not specify the share between you and your wife, by default, IT calculation is taken as 50% share each. However you can make a declaration that you are giving up your share and your wife is eligible for 100% loss/gain from the property depending on who is in the higher tax bracket. Please note the loan should also be joint loan in this case.

For Point# 1, I will check with CA.
For Point# 2, I will check the house agreement if a percentage is mentioned or not and if my memory serves right, there is no such mention so I will go ahead with 50/50. I am on higher tax bracket and hence want to offload the rent income to wife's income. She is homemaker so comes in least bracket as he only incomes are FD Interest, saving bank account interest and capital gains.

[ValarMorghulis]

Hi All,

I'm about to get a big chunk of money from Europe as a tax refund. Since it's been a couple of years since my return, my NRE account is dormant.

How do I get this money without paying another tax again in India (since this is excess money post tax collection from my salary)? Any suggestions or pointers are welcome.

[binand]

Originally Posted by thanixravindran

However you can make a declaration that you are giving up your share and your wife is eligible for 100% loss/gain from the property depending on who is in the higher tax bracket.

This is a very interesting scenario. I would certainly want to take advantage of this. Do you have any references for this?

[thanixravindran]

Originally Posted by binand

This is a very interesting scenario. I would certainly want to take advantage of this. Do you have any references for this?

Apologies I don't have any reference but it was told by my CA quite a few years ago (may be before 2015, I guess). I think at that time, in case of Joint property and Joint loan, only one can claim the interest deduction for Non self occupied property though there is no limit. Please check with any CA for the latest rules or any CA can clarify here.

[raksrules]

I have recently started Corporate NPS and from my company's basket of allowances, I am contributing 10% of my basic for the year. I Also intend to do additonal contribution myself. It is Tier 1 NPS. Based on what I have read, I can claim following deductions, apart from 80c..

• 10% of my basic contributed by me via salary (say it is 50K) under 80CCD(2)
• Additonal 50K that I will contribute myself under 80CCD (1B)

So in this case, over my 1.5L 80c limit, I can claim additional 1L deduction? Is my understanding correct?

[saket77]

Originally Posted by raksrules

I have recently started Corporate NPS and from my company's basket of allowances, I am contributing 10% of my basic for the year. I Also intend to do additonal contribution myself. It is Tier 1 NPS. Based on what I have read, I can claim following deductions, apart from 80c..

• 10% of my basic contributed by me via salary (say it is 50K) under 80CCD(2)
• Additonal 50K that I will contribute myself under 80CCD (1B)

So in this case, over my 1.5L 80c limit, I can claim additional 1L deduction? Is my understanding correct?

For claiming 80CCD2, you will have to route your NPS contribution through your employer/ or your employer will need to contribute 10% of your basic plus DA. There is no limit on this deduction amount.

You can claim 50k over and above the 1.5L 80C limit as your own voluntary contribution apart from 80ccd2.

[raksrules]

Originally Posted by saket77

For claiming 80CCD2, you will have to route your NPS contribution through your employer/ or your employer will need to contribute 10% of your basic plus DA. There of Limit on this deduction amount.

You can claim 50k over and above the 1.5L 80C limit as your own voluntary contribution apart from 80ccd2.

Yes the 10% of basic is being routed through employer. I will get to know in May salary slip at the end of month as this will be first contribution. I expect the NPS contribution to be deducted before arriving at my in hand in May's salary slip.

[raksrules]

I need some assistance here. I have attached latest pay slip screenshot (of relevant section) of my brother's wife and we want to do tax planning, like 80c and all. The in hand salary you see is in ball park of 41-42K Approx each month.

I have her last 6 salary slips and most components are same every month, except sometimes there may be overtime for Under Rs. 500. I see that no income tax is deducted for her at all. She is in old income tax regime as far as I know.

I don't understand income tax stuff properly so can anyone please suggest why there is no income tax being cut at all by her company? If I consider her average salary based on these salary slips, to be 44K a month before deduction of PF and professional tax, then it is 44K * 12 = 5.28L. It may be slightly higher as stuff like gratuity and medical premium may not been deducted or may be shown in some other month's salary slip.

I am unable to understand if she is not coming under taxable tax bracket or what is the situation. Because as per this, If I consider her PF contribution as 1800*12 = Rs. 21600 and standard deduction of 50000, her taxable salary becomes 5.28L - 21.6K - 50K = 4.56L.

[binand]

Originally Posted by raksrules

I am unable to understand if she is not coming under taxable tax bracket or what is the situation.

Instead of breaking your head over this, let her ask her employer for her tax computation worksheet. Depending on the resources available to the company this could be an Excel file emailed out by the accountant or a specific page in an employee self-service portal.

But in general, firms prefer to work their arithmetic in such a way that employees below a certain salary level don't have any TDS to ensure their cash in hand each month is the largest amount possible.

[raksrules]

Originally Posted by binand

Instead of breaking your head over this, let her ask her employer for her tax computation worksheet. Depending on the resources available to the company this could be an Excel file emailed out by the accountant or a specific page in a employee self-service portal.

But in general, firms prefer to work their arithmetic in such a way that employees below a certain salary level don't have any TDS to ensure their cash in hand each month is the largest amount possible.

Yes I will ask her. But even when I go online to put a 5.5L CTC and the figures as you see in the screenshot (HRA, PF, Basic etc), I get no income tax there too. So it seems something is right.
If this is indeed the situation that no income tax is being deducted, I see no point putting the money in any sort of 80C instrument (the PF of 21600 is already part of 80c anyways).

Actually, she wants to invest 10K a month in some instrument and my brother is already putting that in an ELSS fund but that is because he gets income tax cut (due to higher salary). I was thinking ELSS etc for her too but then if I don't have to worry about 80C then I will advice her to invest that 10K in something else like Index fund or something else which doesn't have lock in.