s the money received from LIC money back policies taxable?
Amit Maheshwari Partner, Ashok Maheshwary and Associates replies: Ordinarily, the money received under such policies is not taxable, except in the following cases: If the policy was issued between 1 April 2003 and 31 March 2012 and the premium payable for any of the years during the term of the policy exceeded 20% of the insurance cover (sum assured). Or, if the policy was issued after 31 March 2012 and the premium payable for any of the years during the term of the policy exceeded 10% of the insurance cover.
I sold a plot of land for Ts 30 lakh in March 2019. If I use this money to buy a house, I won’t be able to get the registry done before the due date for filing tax return. What documents will I have to show to claim exemption from capital gains?
Rakesh Bhargava Director, Taxmann replies: The exemption under Section 54F is available if the entire sale amount is invested to purchase or construct a new house within permissible time limits. If you make the investment before the due date for filing tax return, you can claim this exemption, provided the purchase of the property is completed within two years from the date of sale of the plot.
Several court rulings have allowed the exemption on the basis of the date of possession of the property or payment of purchase price and not on the basis of date of the registration of the sale deed. While filing the income-tax return no documents are required to claim the benefit of the capital gain exemption. However, if your return is selected for scrutiny in order to verify your capital gain exemption, you can support your claim by showing the proof of payment.
I bought equity mutual funds in 2018 and now want to sell them. My investment has appreciated by 13.7%. How much tax will I have to pay? If I stay invested for longer, will I have to pay less tax?
Shubham Agrawal, Senior Taxation Adviser, TaxFile.in replies: Capital gains from equity mutual funds are taxed at 15%, if the holding period is less than 12 months, and at 10% if the holding period is more than 12 months. So, from a tax viewpoint, it will be in your interest to complete 12 months before you exit your investment. However, your absolute tax outgo will depend on the gain that you make—higher the gain, higher the tax.
Amit Maheshwari Partner, Ashok Maheshwary and Associates replies: Ordinarily, the money received under such policies is not taxable, except in the following cases: If the policy was issued between 1 April 2003 and 31 March 2012 and the premium payable for any of the years during the term of the policy exceeded 20% of the insurance cover (sum assured). Or, if the policy was issued after 31 March 2012 and the premium payable for any of the years during the term of the policy exceeded 10% of the insurance cover.
I sold a plot of land for Ts 30 lakh in March 2019. If I use this money to buy a house, I won’t be able to get the registry done before the due date for filing tax return. What documents will I have to show to claim exemption from capital gains?
Rakesh Bhargava Director, Taxmann replies: The exemption under Section 54F is available if the entire sale amount is invested to purchase or construct a new house within permissible time limits. If you make the investment before the due date for filing tax return, you can claim this exemption, provided the purchase of the property is completed within two years from the date of sale of the plot.
Several court rulings have allowed the exemption on the basis of the date of possession of the property or payment of purchase price and not on the basis of date of the registration of the sale deed. While filing the income-tax return no documents are required to claim the benefit of the capital gain exemption. However, if your return is selected for scrutiny in order to verify your capital gain exemption, you can support your claim by showing the proof of payment.
I bought equity mutual funds in 2018 and now want to sell them. My investment has appreciated by 13.7%. How much tax will I have to pay? If I stay invested for longer, will I have to pay less tax?
Shubham Agrawal, Senior Taxation Adviser, TaxFile.in replies: Capital gains from equity mutual funds are taxed at 15%, if the holding period is less than 12 months, and at 10% if the holding period is more than 12 months. So, from a tax viewpoint, it will be in your interest to complete 12 months before you exit your investment. However, your absolute tax outgo will depend on the gain that you make—higher the gain, higher the tax.