Sakshi Jaiswar - Page 3 - WCafe Financial Services Pvt Ltd

Helping your help - Financial Awareness

Don’t we all wish to help the weaker sections of our society? Many times we end up donating some money, clothes or other things but not really making a larger impact in their lives. The best way to bring a change is to educate and make someone aware of ways they can do better. One such way is to help the people around you know more about the options available to them to make their lives financially better.

The government has launched numerous schemes to support us financially but only 1.36 billion population avails and benefits from them. And do you know if your domestic workers and other employees are benefitting from them completely? Let us guide you with this article on the schemes that are available and how you can make people around you make the most of it.

Step 1 - Ensure that their documentation is in place, they have an aadhaar card (which is properly linked to their mobile number and address and have a voter's ID. In some cases, they may not have a PAN card so voter ID becomes handy. Also, check if they have a proper bank account, if not help them open a bank account with a nationalised bank or any good bank.

1. Sukanya Samriddhi Yojana

Sukanya Samriddhi Yojana is to invest for those who have a girl child and can contribute in it annually upto 1.5 lakhs and can withdraw the money only for her marriage or higher education. It is earning a fixed interest rate of 7.6% currently and is decided by the GOI year on year. It is a great way to save money for the girl child without anyone being able to withdraw it or close it for their personal gains.

2. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

PMJJBY is a life insurance policy that provides a cover of up to INR 2 lakh rupees against a small premium worth INR 330 per year. You can take this policy for your help and protect their family financially.

3. Pradhan Mantri Suraksha Bima Yojan (PMSBY)

Where you have factory workers, drivers, or even just other domestic workers, you can cover them from any accident and disabilities from those accidents by ensuring they have opted for Pradhan Mantri Suraksha Bima Yojana offers a renewable one-year accidental death and disability cover of Rs 2 lakh a JUST Rs 12 premium every year. This scheme is a great way to ensure that there is some financial support in case of any health issue or death from an accident.

4. Pradhan Mantri Shram Yogi Maan-Dhan(PMSYM)

PMSYM is a pension scheme to provide for their retirement. Most people in the unorganised sector have no ways to plan for their retirement and hence, this scheme should be opted for. They can get a pension of up to INR 3000 and through Atal pension yojana can earn a pension of up to INR 5,000. You can help them cover the investments to be made for these pensions and can work up a way to finance it on their own later. Do help them out with filling the form and understanding in better detail what these schemes are.

Wealth Cafe Advice:

You can contribute on behalf of the weaker section around you as the contribution amount is very small - if not - you can still educate them about it and encourage them to enrol in these schemes as this might be of great benefit to them. Also, if you contribute on behalf of them - inform them about how and when they can benefit from the same.

Should I take a travel loan for my travel plans?

A loan may seem like your ticket to a dream vacation when you lack the cash to cover the hefty price tag upfront. A vacation loan is simply another name for a personal loan you use for travel.

But looks can be deceiving.

That vacation loan you use to finance your seven-day trip could leave you shackled to debt for years and affect your ability to obtain credit when you need it.

Before you take out a travel loan, read the fine print. What appears to be a good deal may not be once you look closer at fees and interest rates.

Reasons to Say No to a vacation loan

Discretionary spending isn't a good reason to borrow money

We'll start with the biggest vacation loan problem: Buying gifts, traveling, and any other vacation expenses you incur are discretionary expenses. When you take out a vacation loan, you're paying interest for things you want, but don't need.

Even if you have excellent credit and qualify for the best personal loan rates, you'll still go into unnecessary debt. You're putting your future self in a more difficult financial situation so you can have what you want right away instead of saving for it.

You could go over budget and borrow more

Let's say you get a vacation loan for an amount you think will cover all your expenses. What if those expenses end up being much more than you bargained for?

Depending on the situation, you may be able to rein in your spending. If you took out a loan to buy gifts, you could look for more economical options. But what if you borrowed money for a vacation trip and you realize halfway through the trip that it's going to cost more than you thought?

You could find yourself borrowing more for those unexpected vacation costs, putting you even deeper in debt.

It makes your holidays more stressful

The whole point of a vacation loan is to enjoy your holidays, but that's hard to do when you're worrying about how you'll pay back what you borrowed and what your bank account will look like after the fact.

If you think you'll be able to push these thoughts out of your head while you celebrate, the odds aren't in your favor. Among people in debt, over half think about their debts at least several times per week and over a quarter think about them every day.

Loan payments make it difficult to save money

When you don't have much money saved, building your savings should be your No. 1 goal. You'll be better prepared for emergencies and future expenses that way.

The more bills you need to pay each month, the harder it is to save. If you get a vacation loan, those loan payments will hold you back from saving money.

It could become a bad habit

I've mentioned why borrowing money for discretionary expenses isn't a good idea. Another reason why you should avoid this is that it often turns into a habit. Once you've borrowed money for something you don't need, it gets easier to do it again.

Here's an example of exactly how this could happen with a vacation loan. You decide to get a 12-month vacation loan this year. Because of your loan payments, you can't save much. By month 11, you need money for the holidays all over again.

At best, you're back to square one -- it's the vacation season and you're short on cash. That's assuming you took out a 12-month vacation loan. If you got a loan with a longer-term and only made minimum payments, you're in an even worse position.

Vacation Loan Alternatives

The risks that come with vacation loans aren’t worth the financial consequences. There are other strategies you can use to put money aside, take that dream vacation, and avoid taking out a personal vacation loan, including:

Cutting back on expenses. If you know you want to take a vacation next year, start planning ahead and looking at your expenses. Ask yourself: Is there anything that I am spending money on that I don’t need? If and when you find areas where you can cut back on your spending, set that extra money aside in a savings account to help fund your vacation.
Automating your savings. Saving for any type of expense or investment is much easier when you use an automated system - SIP'S. Plan your budget and start your SIP today!
Creating a travel budget. Setting extra money aside is one way to set yourself up for success. Creating a travel budget is another. If you don’t know how much your vacation will cost, how will you know how much you need to save? Examine the costs of transportation, accommodation, tourist attractions, and restaurants to give yourself a good idea of how much money you should tuck away.
Utilizing credit card rewards. Credit cards are a handy way to earn rewards on the money you already plan on spending. By opening an airline credit card you can earn a bonus worth a free flight or two. Keeping your eyes peeled for cheap flights. There’s a method to the madness when it comes to snagging a solid deal on flights. While it can feel like luck of the draw, if you know where to look, you can score big. Using a resource to find cheap flights, is an easy way to track down a ticket that can lessen the dent in your wallet.

Wealth Cafe advice:

The best way to enjoy a vacation is to always plan well in advance. When your finances are built up, it would be the right time to embark on the trip. The idea of buying now and paying later could be an appealing alternative but there is no point to make your holidays costlier than necessary as it leads to financial stress later on. In the end, it is much of a personal choice in determining how much the vacation is worth to you. A few days of joy that lead to a loan hanging around your neck for the next few years may not be the best idea.

Loans should always be for necessities, assets, and emergencies. If it's for luxury, one may be living beyond their means.

To learn more about saving and investing enroll in our course: NM 101- Maximise your Savings

Budget 2021 / Debt / Money tips - 08/19/2022

How can a Queer Couple Manage their finances together?

Financial discussions between a couple are very important, discussing how much you earn, what you should do with your earnings and how to invest eventually becomes very important as you both would be looking to do things together.

Now, this is no different for queer partners as well. Even though legally, one is not allowed to get married, you may be equally committed to each other and combine everything in your life including your finances.

This blog is to guide you on ways in which you can look at your finances together and put things in place properly from your bank accounts to investments to asset buying.

1. Combining your cash flows - Joint Bank Account
Opening a joint bank account may help you share your income and expenses with each other and look at your lifestyle as one unit. According to the law by the Reserve Bank of India (RBI), there is no restriction on who can open bank accounts. You can go to any bank and open a bank account with each other as joint holders.

However, many banks do not permit non-relatives to open joint account holders as they believe that it would lead to more complications when one of them dies and the heir of the person comes to claim the money. The best way to get this done is to have a direct conversation with the banker and request them to help you open a joint bank account.

In fact, Axis Bank has become one of the first banks to announce new policies and practices for its customers and employees from the LGBTQ community. We have heard people facing some problems around it but you can definitely connect and know more.

2. Managing Cash Flows together

There is no difference between a heterosexual and a homosexual couple in managing cashflows. You must do it based on whether both of you are earning or one you are earning. The idea is that where both partners are earning, contribute an equal proportion of your income towards expenses and where one of you is earning, you must take care of all the living expenses.

You can learn more about how to manage your cash flows from here

Where you cannot open a joint account together, you can share logins of 1 account with others, and have an add-on credit card to keep your transactions smooth.

3. Investing Together - Set your goals

Do not worry, I am not going to recommend pooling your funds in one common bank account and investing through it. Invest from your individual accounts towards the combined and individual goals. Take the time out this weekend and discuss and note down your goals. This would also give you a chance to speak to each other about your goals, and why and how you can work on them.

No transfer of funds into each other's accounts.

As per the income-tax laws, where one person transfers money to another account (without any service), it is considered as a gift. Gifts to all non-relatives above 50,000 are taxable in the hands of the recipient. We would highly recommend not transferring funds into your partner's account to invest/or otherwise.

Where your goals could be the same (like buying a house or car together), you must invest for it from your respective accounts in respective funds.

4. You can buy assets together

Yes! You can buy a house, a car, and land together. There is no law stopping 2 people from buying things together. So you can go as partners, friends or family and register a house in your name. However, it is preferable that both of you fund such a property so that banks or builders do not raise any concerns on the same.

Practical concern: Because our society is not yet acceptable, brokers and developers may create an issue when we openly tell them that we are a queer couple. However, if you just go and buy a house as partners and no discussion about your personal relationship is done, it will make your life easier as you would be avoiding unnecessary discussions.

5. Leaving your asset to your partner - Inheritance

You must know that both of you want to spend the next good life together and hence are looking to even combine your finances together. The problem is not about getting the asset together but tomorrow, if you decide to go your separate ways then splitting the assets can be difficult.

Also, if your family is not very accepting of the relationship, they have the first legal rights on your share of the assets than your partner. To explain in detail, even where you and your partner buy a house with a 50% co-ownership, the share of your partner will first vet on their family members than you (because the law does not recognise queer couples/partners as legal heirs).

To avoid any such claim by family members of your share of the assets, the best way is to write a will, leaving your share to your partner (if this is something you want to do). Consulting a lawyer and a financial planner to buy an asset seamlessly would be advisable.

6. Foolproof method

You can start a business entity together like an LLP or a private limited company where both of you are partners and you can buy assets and investments in the name of the business. This will not only ensure that you can easily buy the assets but also ensure that the asset is passed on to the surviving member. However, there is an associated running cost of managing a separate business entity and hence, may not be feasible for everyone.

Every individual and every family must take care of their personal finances as money plays a very important role in setting dreams and achieving them. The basics of financial planning and how to set goals would remain the same for you as for any other couple and hence if you are open to learning more about it - you can check our course - Honey & Money

Do share this article with any friend/family who will benefit from this.

Investments - 08/12/2022

What is a Revised Return?

I hope you have already filed your Income Tax Return. Generally, you need to file your Income Tax Return by July 31 of any year unless extended by the government. However, at times in order to meet the deadline, we may forget to disclose some income or may make unintentional mistakes like a mistake in claiming any deduction.

In such a situation, you can always file a revised return.

What is a Revised Return?

A revised return is a return that is filed u/s 139(5) as a revision for the original return. It is a revision for any omission or mistake made in the filing of that original return. In order to meet the deadline, a person may forget to disclose some income or may make any other mistake like a mistake in claiming any deduction.

For example: If a Return of Income is filed by the assessee for the Financial Year 2020-21 i.e. Assessment Year 2021-22 and he later discovers some mistake, he can file a Revised Return of Income Tax anytime up to 31st March 2019 or before the completion of the assessment whichever is earlier.

Return eligible for revision

The original return filed u/s 139(1).
The belated return filed u/s 139(4) can also be revised now.

Points to keep in mind while filing a revised return:

ITR form can be changed while revising of return.
No penalty can be levied by the department for bonafide mistakes (unintentional)
If the assessing officer discovers that the error/ omission was intentional/fraudulent return revision of the return is not allowed and a penalty may be levied.
Interest under sections 234B and 234C will be recalculated under every revised return.
If the taxpayer has revised the return after the survey/search and it was has found that the mistake in the original return was not bonafide then the levy of penalty is justified.

Time Limit

Revised Return of Income Tax can be filed by an assessee at any time

Before the end of the relevant assessment year; or
Before completion of the assessment

whichever is earlier.

For example: If an assessee files the return for F.Y. 2020-21 (A.Y. 2021-22) on 8th July 2021. And later on, if he discovers some mistake, then he can file a revised return of Income Tax anytime up to 31 March 2022 or before the completion of the assessment, whichever is earlier.

Here is how to file a Revised Income Tax Return:

Visit the Income Tax website, now login into the Income Tax e-filing portal by entering PAN/ Aadhar/ other user ID.
After logging in, you need to select your assessment year and select ITR Form Number.
After that after under ‘Filing Type’ select ‘Revised’
Now under the ‘General Information tab, choose the ‘return filing section’ as ‘revised return’ under Section 139(5) and the ‘return filing’ type as ‘revised’.
Now enter the acknowledgement Number and Date of filing of the original return. (It is compulsory to enter the 15-digit acknowledgement number when filing a revised ITR).
Carefully fill in or correct relevant details of the online ITR form and then submit the ITR.
Finally, e-verify the returns for faster processing and a quicker refund.

Wealth Cafe Advice:

Usually, mistakes/errors take place when you sit to file your ITR during the deadline period. Make sure you are ready with all the documents and be prepared to file it well in advance - this will also help you to get your refund on time. However, if you still discover a mistake after filing the original return, rectify it yourself by filing a revised return or consult your accountant rather than waiting for the Govt to send a notice.

Income Tax / Uncategorized - 08/05/2022

What are the investing habits of millennials?

One of the largest generations in history is about to move into its prime spending years. Millennials are poised to reshape the economy; their unique experiences will change the ways we buy and sell, forcing companies to examine how they do business for decades to come.

Who are they?

Millennials or Generation Y are people born between 1981 and 1996. Currently, they constitute a third of India’s population, and 46% of the current workforce. For many, this generation is an enigma when it comes to many things. Whether it’s managing relationships, careers or wealth, they’ve presented the world with new ideas and strategies.

How are our millennials investing?

Some financial habits of millennials tend to come across as alarming to the previous generations. Especially Generation X who have worked hard to get themselves out of financial ruts.

These habits include spending more, experimenting with investment products, and enjoying the benefits of Credit Cards. However, the broader view is that millennials, while splurging on interests or passions, are equally aware of the need to build a corpus for a secure future. Moreover, they may be prone to experimenting with new financial products but will choose traditional options too.

Let us have a look at the money-making habits of millennials:

Starting early and diversely!

Trends suggest that millennials believe in starting early, given that on average, most investors are 28 years of age. More than 30 percent of the investors fall between the age of 26-30 years old, with the second most populous category (at 29 percent) belonging to those between 18-25 years. Even when it comes to starting with popular retirement savings options like NPS (National Pension Scheme), the starting age is 32.

When it comes to investing preferences, the young guns prefer mutual funds (64 percent), followed by equity (28 percent), and lastly, gold (8 percent). In fact, gold, traditionally seen as an inflationary hedge, saw a Y-o-Y increase of 59 percent in investors' portfolios.

Mutual Funds top the chart

56% of millennials invest in Mutual Funds. Turns out, our millennials ace financial discipline and regularity in terms of Systematic Investment Plans (SIPs). Turns out, our millennials ace financial discipline and regularity in terms of Systematic Investment Plans (SIPs). On average, the user undertook around 10 lumpsum and 19 SIP transactions, with the average amount invested growing by around 29 percent. Moreover, 76% of users transacted in SIPs, a healthy figure.

Source: Moneycontrol

Day trading, investing in stock markets, IPOs

Lockdowns and work from home have given many millennials enough time to keep a track of stock market developments. Access to easy-to-use mobile apps has made day trading a lucrative side income option for millennials.

Indian millennials are also bullish about IPOs of new-age companies. They are not scared of the stock market risks

Investing, trading in cryptocurrencies

Even as cryptocurrencies are not regulated in India, millennials are the largest force behind the popularity of these new-age digital assets. Easy access to crypto exchanges through mobile apps and the active interest of millennials’ role models like Elon Musk have further pushed millennials towards cryptocurrencies.

Millennials in general are drawn towards a culture of earning passive income on their time and investments. Crypto investments are very popular for this age group, in fact, more than 50% of investors are millennials. They are open to learn this new technology (Blockchain) and explore new opportunities that come with it— Decentralized finance or Defi, staking, liquidity pools, NFTs are such new and trending opportunities

As age progresses, their investment pattern also evolves. So for instance, while people in their teenage and early 20s indulge more in crypto trading, the senior folks consider more evolved forms of investing such as a Fixed Income Plan or a SIP aligned to multiple goals.

Creating value from the gig economy

Multiple online platforms are enabling Millennials to make extra money, apart from the regular job, by making the best use of their skills through freelance gigs.

While millennials need to work on their spending, saving, and long-term investing habits, being more money mindful. One lesson that can be learned from them is leveraging earning opportunities. The gig economy today has enabled the generation to effectively make use of their skills and capabilities and create value.

Automating wealth creation

Millennials are creating a new habit of money-making by automating the process of investing or wealth creation itself!

Currently, they are doing it by setting up auto-debit for their mutual fund investments closer to the date when their salary gets credited. Moving forward, they will be able to set up triggers for automated investing throughout the month based on the transactions in their linked savings account.

Investing in Digital Gold

Digital gold is increasingly becoming the asset of choice among millennials to create and protect wealth. Millennials look for ease of investments and higher returns but also for assets that help them fulfill their aspirational needs and are a good emergency corpus.

Conclusion

Millennials are different when it comes to financial planning. They are willing to take a risk to earn higher returns. This generation is called tech-savvy and gadget-savvy, and it’s time to be investment savvy also!

To learn more about mutual funds enroll in our course- NM 103: Basics of Asset Classes

Investments / Uncategorized - 07/29/2022

How to Add Biller for SIP Transactions in Banks for Net Banking?

As we all know, SIP or Systematic Investment Plan is an investment mode in Mutual Funds where investments happen in small amounts at regular intervals in the Mutual Fund schemes. You can invest in SIP via Bank Mandate or through Net Banking.

In this article, we will focus on the Net Banking Mode.

In Net Banking Mode, adding a biller is an important step as it automates your investment, meaning your instalment will automatically get debited from your account at a specified date every month. If you do not set up the biller, then all your future instalments will not execute.

Please note that the process of adding a biller is different for different banks. In this article, we have used Kotak Mahindra Bank as an example.

Step 1: Log in to your Net Banking account

Step 2: Click on Payments/Taxes

Step 3: Select the right mutual fund - Kotak mutual fund in our case of SIP setting up

Step 4: Add the details on this page of URN number and select the entire bill amount as the option. You will get this number when you create/setup SIPs online after that transaction is submitted.

Please Note: Do not forget to mention your URN Number. It is generated for every SIP you initiate online to add/confirm your online transfer of funds. It expires in 7 days from the first date of KYC Registration.

Step 5: Add biller and confirm

If you wish to learn more about how to invest in Mutual Fund Online you can check our Youtube Playlist: Software and Tools for it and to learn more about Mutual Funds check out our course - NM 104: Basics of Mutual Funds.

Uncategorized - 07/23/2022

What is TDS? Why is TDS Deducted and How to Claim a Refund?

We all have heard about TDS and might have also seen it get deducted from our salary, but do you understand what it is and why is it deducted? Is it only deducted from our salary or do we pay TDS on something else too?

In this article, we shall help you to understand this concept in a better way.

What is TDS?

TDS stands for tax deducted at source, it was introduced by the Income Tax Department to collect tax from the very source of income instead of depending on the person earning to pay taxes.

TDS is generally lower than the actual income tax rate one pays. And it forces the recipient (of income) to declare their income as the government already has the information. Also, in case the TDS collected is more than what you owe the government, you can always claim a TDS refund.

Rates prescribed for different types of payments

There are over 20-25 sections that prescribe different types of payments on which tax is deductible at the source. You can learn more about it here.

How to claim your TDS Refund?

Where you have earned 50,000 INR in a year and only 45,000 INR is paid to you and 5000 INR is paid to GOI as TDS, then if you are eligible, you can claim a refund of the TDS amount.

File your Income Tax Return within the due date i.e. 31 July of the next financial year.
Where the tax liability for the entire year is less than the TDS deducted for you, you will get a refund. Where it is more than that - you pay the balance as taxes. To compute this, it is very important you check your income, understand in which heads of income you fall under, understand your taxes and consult a chartered accountant who would help you with it.

What are the TDS rules?

There are certain rules set out by the tax authorities regarding TDS, that if followed properly will not end up paying penalties, interest, and fees.

Tax deduction rules: Tax is required to be deducted at the time of payment getting due or actual payment whichever is earlier. A delay in deduction of tax will attract interest @ 1% per month until the tax is deducted.
TDS payment rules: Every person is required to pay the tax deducted to the credit of the government by the 7th day of the following month. Non-payment or late payment of TDS will attract interest @ 1.5% per month until the tax has not been deposited.
TDS return filing rules: TDS returns are required to be filed timely on the 31st day of July, October, January, and May during a financial year. Non-filing or filing of return after the due date will attract fees under section 234E @ Rs 200/- per day until the return is filed. However, this amount shall not exceed the amount of tax.
Once you pay your TDS, you receive a TDS certificate - Form 16/16A. Read here to know more about it. This TDS certificate will help you to file your ITR and claim a refund/ know your tax liability at the end of the financial year.

Understand better about TDS with this youtube video

Wealth Cafe Advice:

If your TDS is getting deducted, make sure you know the source of your income and why the TDS has been deducted. Once you figure these things out, it is important to understand whether you are eligible for the refund and if yes, file your return by 31 July to claim that refund. If there is a payable situation, then you must file the return, pay the taxes and be free from any surprise penalties.

Tax - 07/08/2022

How can you get started with Cams online?

We always get messages on our social media handles about which platform should they use to invest in Mutual Funds. And the only platform that we always recommend is CAMS ONLINE!

In today's era, we have so many platforms to invest in a mutual fund, but with so many options comes a huge amount of confusion as well as complications!

What is CAMS?

CAMS stands for Computer Age Management Service. It is a SEBI-registered Registrar & Transfer (R&T) Agency that provides a single gateway to 17 CAMS serviced Mutual Funds.

While investing through this platform you don’t have to deal with multiple PINs, folio numbers and login IDs as this platform is easy and convenient to use. It also provides a consolidated view of Mutual Funds (which are serviced by CAMS) invested across platforms, demat accounts and others.

So why do we recommend Cams online over other private platforms?

Despite offering a variety of services, CAMS is considered a safer platform as far as data privacy and transparency are concerned. It follows very stringent data policy measures to ensure your personal data is secured at the maximum level.

Also, since myCAMS is not a B2B partner, they do not market themselves nor do they promote any mutual fund schemes. However, the mutual fund mobile apps that are now trendy are more exposed to the mutual fund schemes that app owners are advertising/promoting through recommended portfolios or as top funds. In short, Cams online ain’t biased, nor would they sell any scheme in any manner.

How can an existing investor, invest through Cams Online?

I have invested in Mutual Funds through different platforms, how can I continue to invest in it through Cams online?

Visit mycams.camsonline.com
Click on ‘New User’ to create a new user.
In the ‘New User Registration screen, click on Register under existing investor with cams.
Enter the registered email id and mobile number. Click on Submit.
(On completion of the registration process, an alert confirming the same is displayed on the screen)

You will receive a confirmation email

How can a First-time Investor Invest from CAMS?

Visit mycams.camsonline.com
Click on ‘New User’ to create a new user.
In the ‘New User Registration screen, click on Register & Transact under First-time investor to Cam's service funds.

Now that you have registered, check your KYC status - go to https://camskra.com/ and provide your PAN details.

If you have not completed your KYC, you need to complete your KYC registration before you start investing. Following are the documents required to complete your KYC process:

Aadhar Card Soft Copy
Pan Card Soft Copy
Cancelled cheque along with your name on it.

The next step is to update your Bank Emandate!

Bank E Mandate is a standing instruction to a bank to debit your account on a periodic basis for a periodic transaction like Systematic Investment Plans (SIPs) / Target Investment Plan (TIP). This process is entirely digital end-to-end with no involvement of any physical forms or signatures at any point of time, nor do you have to issue checks for SIPs each month.

E-Mandate can be registered within 2-3 days and you can commence your SIP in less than 7 days unlike a wait of over 30 days in the alternate scenario. Therefore, the bank mandate plays an important role by making your investing experience simple and convenient.

However, before applying for the E-Mandate ensure that your PAN number is mapped to your bank. Also, your PAN needs to be linked to your Aadhar; otherwise, the application could get rejected.

Steps to complete your Bank E Mandate process:

Go to: https://mycams.camsonline.com/camsapp/mycamsemandate.aspx
You will get an OTP on your email as well as your phone number after you submit your Pan number and Email Id.
Once you enter the OTP, you get the ‘Register Emandate’ screen
Enter your bank details correctly
Next, the mandated amount should be filled (the maximum amount per transaction can be Rs 1 lakh). You can also choose the transaction period for which you want the mandate to be valid.

Wealth Cafe Advice:

Though other apps may look convenient or easy to use in comparison to Cams, however, it is important to note that this is a much safer platform contrary to the other private platforms.

We hope you have understood how you can get started with Cams online. To learn more about Mutual Funds you can check out our course: NM 104: Basics of Mutual Funds

Uncategorized - 06/17/2022

All about First Installment of Advance Tax Payment

Advance tax means income tax that should be paid in advance instead of lump sum payment at year-end. It helps the Govt. to receive a constant flow of tax receipts throughout the year so that the Govt can incur its expenses timely rather than receiving all tax payments at the end of the year. This keeps the government rolling

Who is liable to pay Advance Tax?

The eligibility criteria you will have to fulfill in order to pay advance tax are:

Your tax liability should be INR 10,000 and above.
You should be a salaried or a self-employed individual.
Income received via capital gains on shares.
Interest earned on fixed deposits.
Winnings are earned from a lottery.
Rent or income earned from house property.

Exemption in Advance Tax Payments

Senior citizens aged 60 years and above are exempted from paying the advance tax.
Salaried individuals falling under the TDS net are exempted from paying the advance tax.
However, any earnings from sources such as interest, capital gains, rent, and other non-salary income will attract advance tax.
If TDS deducted is more than the tax payable for the year, then one does not have to pay the advance tax.

Payment of Advance Tax:

You can choose to pay advance tax by any of the following modes:

Offline Mode: You can pay advance tax using Challan 280 just like any other regular tax payment at bank branches authorized by the Income Tax Department.
Online Mode: You can also pay it online through the official website of the Income Tax department.

In case you fail to pay advance tax, you will be liable to pay 3% of the shortfall - if the advance tax is more than 12% of tax).

However, it is important to note that no interest(penalty) is payable if the advance is tax paid on or before 15th June. Also, if the advance tax is less than 12% of the tax due for the year.

WealthCafe Advise

Advance tax is a good means to check your income, evaluate it and understand if you need to pay any taxes. Where you do come under the provisions of advance tax, best to consult the same professional for advice on the same.

Income Tax - 06/03/2022

What is Capital Gain Account Scheme?

In our earlier blog, we have discussed some of the ways in which you can reduce your capital gains while selling a house - but what if you are unable to reinvest your capital gains before the specified duration to benefit from the exemption available? To address this, the Capital Gains Account Scheme(CGAS) concept was introduced.

For example, Mr A sold a residential property in January 2022 and he intends to claim capital gains exemption by purchasing a new residential house. To claim the capital gains exemption, he must purchase the new residential house within 2 years i.e. before January 2024. However, the due date of filing of ITR for the Financial Year 2021-22 is 31st July 2022 and the gains arising on the sale of the property are required to be reported in the ITR.

In such cases, the govt prescribes that the amount to be reinvested be deposited in a Capital Gains Account before the filing of the ITR. The seller does not immediately have to deposit the amount in the Capital Gains Account and he can do so at any time before the due date of filing of ITR i.e. before 31st July for non-audit cases and before 30th Sept for audit cases.

By claiming this Capital Gains Exemption, the taxpayer would be able to save the 20% Long Term Capital Gains Tax which he would be required to pay in case he does not intend to claim this exemption.

What is a Capital Gains Account Scheme?

Capital Gains Account Scheme (CGAS) allows you to safeguard your long-term capital gains until you are unable to invest it in a house before the due date for filing an income tax return (July 31 after the given assessment year) and before the income tax returns are furnished.

But to benefit from this, you need to ensure that you utilise the amount deposited in the capital gains account within 2 years of the sale of the property. If this is not done, the unutilised amount will be subject to capital gains tax in the fiscal in which the deadline ends.

Also note, You are not permitted to hold a joint account under this scheme but up to 3 Nominees can be nominated). The proof of deposit into the CGAS account should be attached along with the income tax return for you to be able to claim exemption from long term capital gain tax for the financial year during which the transfer was made.

Where can you open a Capital Gains Account?

You can open a Capital Gains Account in any branch of the authorised banks recommended by the Government which includes Central Bank of India - State Bank of India and the public sector banks like Bank of Baroda, Bank of India, Bank of Maharashtra, Canara Bank, Central Bank of India, Indian Bank, as well as Union Bank of India are some of the 28 permitted banks. However, these facilities are unavailable for their branches in rural areas.

What are the different types of deposits available?

There are two different types of deposits that you can avail of under the Capital Gains Account Scheme.

Type A: Referred to as a savings deposit, this capital gains account is similar to a regular savings account. It even earns a similar interest rate. The interest is credited at regular intervals, and you will receive a passbook to record all your transactions. Like a savings account, this type of deposit is highly liquid, so you can easily withdraw at any time.

Type B: Referred to as term deposits, this type of deposit is similar to fixed deposit schemes of banks. The rate of interest, terms of investment, and restrictions are also very similar to that of a fixed deposit. This type of account has a maximum term of 3 years if you are constructing a house, and 2 years if you plan to buy a ready house, and it will not auto-renew at the end of the term - any premature withdrawal will attract a penalty. Like you would with a fixed deposit, you will receive a deposit certificate, which will be required when you need to withdraw. The term deposits can be cumulative or non-cumulative.

For both types of deposits, the RBI fixes the rate of interest periodically. Based on your plan of investment and rate of interest, you can select the deposit type that best aligns with your requirements.

Generally, it is Prevailing Interest Rates as applicable to general Saving Bank and Term Deposits shall also apply to Savings and Term Deposit opened under CGAS.

Withdrawl from Capital Gains Account Scheme

Withdrawal is a slightly complex process. You cannot withdraw money freely from your Capital Gains Account, you can utilise it only for the purpose for which the deposit was made. Such purpose needs to be submitted to the bank in Form C while withdrawing money from Account A whereas to withdraw money from Account B, you need to transfer the balance amount from Account B to Account-A and then according to the CGAS provisions you can withdraw the amount. Also, you need to make payment through crossed demand draft for withdrawal of more than INR 25,000.

The amount withdrawn should be utilized within 60 days of such withdrawal. The unutilized amount should be again re-deposited into the CGAS account. In case the withdrawal amount is not utilized and not deposited back within 60 days then you will lose the benefit of exemptions i.e. it becomes taxable.

At the time of closure of all accounts, the depositor will have to produce a specific authority letter/ certificate from the Income Tax Officer of the respective jurisdiction. The closure would be allowed on the terms mentioned in the letter of authority.

What happens if you were not able to construct or buy a new house till maturity?

If the amount not utilized remains in the Capital Gain Deposit Account Scheme even after a specified period of 2/3 years, 100% of the not utilized amount will be taxed as long term capital for the financial year in which the specific period gets over.

Things to note:

No loan facility against this deposit is available. This term deposit can neither be accepted as margin money for non-fund based nor as collateral to any type of fund-based facilities.
On your own desire, you can apply for a transfer of your account from one deposit office to another deposit office of the same bank.
Closure of both Type A and Type B accounts require prior approval from the jurisdictional income tax officers.

In case of closure of the account due to the death of the account holder, the legal heirs can claim the deposit through Form H. Please note, that the legal heir can withdraw the amount without any tax implications.

Wealth Cafe Advice

Purchasing a new residential property may take time. You have to find a preferred home/apartment that you like to buy, negotiate with the seller and complete paperwork – all of which can be time-consuming. Investing in capital gains accounts gives you temporary relief. Consider this as parking your capital gains tax safely for the time being, while you scout for a new property.

Investments / Real Estate - 05/27/2022

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