Inquisitive Mind

Filing your income tax return (ITR)? Have you checked your Annual Information Statement (AIS) and Taxpayer Information Summary (TIS) for the year? What is Annual Information Statement (AIS)? AIS is a comprehensive statement of taxes deducted / paid, incomes received, expenses incurred, investments purchased / sold and other financial transactions made during the financial year. AIS was rolled out by Central Board of Direct Taxes in November 2021. What is Taxpayer Information Summary (TIS)? TIS is a summarized version of AIS and provides category-wise information to ease filing of ITRs. The information included in TIS is pre-filled in the ITRs on the income tax e-filing portal. What information is captured in AIS? AIS provides information on taxes deducted / paid during the financial year including tax deducted at source (TDS), tax collected at source (TCS), advance tax paid and self-assessment tax paid. It also covers 53 categories of financial transactions including incomes received, ...

People keep their savings (and earnings) in various bank accounts. But what happens if a bank fails (i.e. closes down)? Can the depositors get their money back? Are deposits with banks insured? What is deposit insurance? The deposits kept with the banks are insured by the banks with Deposit Insurance and Credit Guarantee Corporation (DICGC). In the event of failure of a bank, DICGC pays the depositors up to the insured amount of the deposits. Which banks are covered for deposit insurance? Public Sector Banks Private Sector Banks Foreign Banks – branches of foreign banks functioning in India Small Finance Banks Payment Banks Regional Rural Banks Local Area Banks State Co-operative banks District Central Co-op banks Urban Co-op  Primary cooperative societies are not insured by DICGC. A list of banks insured with DICGC is available at https://www.dicgc.org.in/FD_ListOfInsuredBanks.html Which deposits are covered for deposit insurance? DICGC insures all deposits such as savings, fixed,...

Be it opening a new bank account, applying for a new credit card, registering for new e-wallet, or any other account or facility involving financial matters, the application process is incomplete until KYC is done.  What is KYC? KYC or Know Your Customer is a process of customer identification and verification while opening an account or undertaking a financial transaction. Why is KYC process needed? To prevent money laundering To combat financing of terrorism What is verified under KYC? The banks / financial institutions collect the relevant documents from the customers to verify the following – Proof of identity Proof of address Which documents can be collected for KYC? As per RBI’s Master Direction - Know Your Customer (KYC) Direction, 2016 (Updated as on May 10, 2021), “Officially Valid Document” (OVD) means – Passport Driving licence Proof of possession of Aadhaar number Voter's Identity Card issued by the Election Commission of India Job card issued by NREGA duly signed by an...

For those investing in government securities, managing their investments has got easier with the introduction of Reserve Bank of India’s (RBI’s) Retail Direct Scheme.  What is Retail Direct Scheme? Retail Direct scheme is a one-stop solution for investment in Government Securities by individual investors. Which securities are covered under Retail Direct Scheme? (Updated on November 06, 2023) A retail investor can invest in following securities through primary issuance as well as in secondary market – Government of India (GoI) Treasury Bills Government of India (GoI) dated securities Sovereign Gold Bonds (SGB) State Government Securities (SGSs) [earlier called State Development Loans (SDLs)] Floating Rate Savings Bonds, 2020 (Taxable) – FRSB 2020 (T) How to invest under Retail Direct Scheme? The retail investor must open a Retail Direct Gilt (RDG) Account with RBI at  https://rbiretaildirect.org.in/#/ Who can open RDG Account? For opening and maintaining a RDG Account, a retail...

A taxpayer pays taxes on the income by way of tax deducted at source (TDS) on salary, quarterly advance tax, self-assessment tax paid at the time of filing income tax return (ITR), etc. But is there an option to find the details of the taxes paid all at one place?  What is Tax Credit Statement (Form 26AS)? Tax Credit Statement (Form 26AS) is a consolidated statement of the tax paid / deducted / collected by a taxpayer for an assessment year. It includes tax deducted at source (TDS), tax collected at source (TCS), advance tax paid, self-assessment tax paid, etc.  How to download Tax Credit Statement (Form 26AS)? Login to income tax e-filing portal ( https://eportal.incometax.gov.in/iec/foservices/#/login ). Go to ‘e-File’, click ‘Income Tax Returns’, then click ‘View Form 26AS’ Click on ‘Confirm’ Tick the checkbox agreeing to the usage and acceptance of Form 16/16A and then click on ‘Proceed’ Click on ‘View Tax Credit (Form 26AS)’ Assessment Year – Select the assessment year fo...

A few days before the announcement of Reserve Bank of India’s (RBI’s) monetary policy, the media is flooded with news about guesses and expectations of the market players about the rise or fall of repo rate. Why are markets so concerned about the changes in repo rates? How the changes in repo rate affects the inflation and growth in the economy? To begin with, let us understand some terminologies. What is Monetary policy? Monetary policy is a policy of central bank of the country (for India, its RBI) whereby it aims to control the money supply in the country to manage inflation and promote growth. RBI increases / decreases the policy repo rate so as to keep the operating target i.e. weighted average call rate (WACR) around the repo rate, within the interest rate corridor. This in turn influences the aggregate demand and thereby impacting inflation and growth. What is interest rate corridor? Interest rate corridor is a range of interest rates consisting of Marginal Standing Facility (MS...

The first bi-monthly monetary policy of RBI for the year 2022-23 was announced on April 08, 2022. Monetary policy stance Remains accommodative while focusing on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth.  Rates Policy repo rate kept unchanged at 4%. The amendment to Section 17 of RBI Act in 2018 empowered RBI to introduce Standing Deposit Facility (SDF). The SDF will replace the fixed rate reverse repo (FRRR) as the floor of the LAF corridor. SDF rate will be 25 bps below the policy rate and MSF rate will continue to be 25 bps above the policy repo rate. Thus, the width of the LAF corridor is restored to the pre-pandemic configuration of 50 bps.  Marginal standing facility (MSF) rate and Bank rate remain unchanged at 4.25%. Standing deposit facility (SDF) rate will be at 3.75%.  The fixed rate reverse repo (FRRR) rate is retained at 3.35% and its operation will be at the discretion of RBI for purp...

The taxpayers can claim certain deduction from their total income before arriving at the taxable income for calculating the tax. From the financial year 2020-21, these deductions are available to taxpayers who opt for the Old Tax Regime. The deduction which can be claimed by an individual taxpayer from Gross Total Income under the various sections of the Income Tax Act, 1961 are listed below. Section 80 C Premium paid on life insurance policy Employee’s contribution to employee provident fund (PF/EPF) Deposit in public provident fund (PPF) National savings certificate (NSC) Savings in senior citizen savings scheme Investment in equity linked savings scheme (ELSS) mutual funds Repayment of housing loan (principal component) Fixed deposit for 5 years or more Tuition fees to school/college/institution in India for full time education of up to 2 children Deduction up to Rs.1,50,000/- Section 80 CCC Investment in annuity plans for pension scheme Section 80 CCD (1) Employee’s contribution to...

Filing an income tax return and its showing ‘Tax payable’? You need to pay the self-assessment tax.  How to pay self-assessment tax? Go to NSDL portal https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp Choose CHALLAN NO./ITNS 280 Tax Applicable – (0021) Income Tax (Other than Companies) Type of Payment – (300) Self-Assessment Tax Mode Of Payment – Choose your desired mode of payment Permanent Account No – Enter your PAN Assessment Year – select the assessment year Enter your address and captcha code Click on ‘Proceed’ You can see the preview of your challan. Tick the box ‘I agree’ You will be redirected to the Bank’s site. Complete your transaction. Download and save the receipt / challan for future reference. Go back to ITR filing portal and enter the challan details of self-assessment tax. Submit and e-verify your income tax return. Related Articles Filing your ITR? Have you checked AIS and TIS? How to file Income Tax Return (ITR–1)? Got salary arrears? Have you claim...

Want to close your Demat account but unable to do so because of shareholdings in the account? Or want to transfer shares from one Demat account to another without selling? Let’s see how to execute an off-market transfer of shares from one Demat to another. What is Depository and Depository Participant? A depository keeps the records of ownership of financial securities and facilitates trading of securities. A depository participant (DP) is an agent of the depository who offer depository related services to the investors through Demat accounts. There are two depositories in India –  National Securities Depository Ltd (NSDL)  Central Securities Depository Ltd (CDSL) The DPs can be banks or brokering firms. The DPs are linked to either NSDL or CDSL. The list of DPs registered with NSDL can be checked at https://www.sebi.gov.in/sebiweb/other/OtherAction.do?doRecognisedFpi=yes&intmId=19 and the list of DPs registered with CDSL can be checked at https://www.sebi.gov.in/sebiweb/...