Whether a joint holder of MIS can continue with it even after the death of the first holder till the balance period of six years.
Whether a nominee can continue with the scheme after the death of a single MIS holder.
Whether there can be one or more nominees in case of joint holders.
Whether MIS of post office is preferable over LIC Varishta premium scheme.
Suggest any reading material available to study MIS of post office before investment.
ML Gupta, firstname.lastname@example.org
1. Yes, if one of the depositors of an MIS account dies, the account will be treated as a single account in the name of the surviving depositor from the date of death of the said depositor. When a report to this effect is received in the post office, the Postmaster will ask the surviving depositor to withdraw the excess amount in excess of the limit prescribed for a single depositor (Rs 3 lakh) and this excess amount will not carry interest from the date of death of the joint depositor. The interest already paid on this excess amount will be recovered or adjusted.
A small care has to be taken. The surviving single account holder should effect a nomination as soon as possible.
2. No. The nominee/legal heir will not be allowed to continue the account by transferring the same in his name after the death of the depositor.
3. Multiple nominees are possible. I prefer single nominee since I find, more often than not, multiple nominees are riddled with problems at the time of distribution.
4. MIS is superior to LIC because of the lower term of 6 years, better liquidity (encashability after 1 year) and the bonus of 10 per cent at maturity raising the average annualised interest rate to 9.66 per cent.
I suggest read my book, In the Wonderland of Investment, 22nd edition.
Kindly clarify whether both taxable income and tax-free income are to be included under total income for availing deduction U/S 80 GG. Secondly, would deduction u/s 80 be included under total income or not.
Also clarify whether house rent receipt is required to be attached while filing the income tax return for FY 03-04. Also please enlighten me about the standard deduction rates and surcharge, if any applicable to FY 03-04.
Dr Prem Singh Dahiya, email@example.com
1. All tax-free income, including standard deduction on salary or pension, professional tax, etc, do not form a part of total income.
2. For the purpose of Sec. 80GG, total income means income arrived at after giving effect to all the deductions, including deduction u/s 80L but before this particular deduction.
3. Yes, rent receipt in the original is required to be attached.
4. An employee with a salary of Rs 5 lakh or less (before standard deduction and deduction for professional tax) is entitled to a standard deduction of 40 per cent of the salary or Rs 30,000, whichever is less. Salary over Rs 5 lakh attracts a deduction of Rs 20,000.
5. Surcharge @10 per cent on tax computed after deductions of rebates is levied on individuals, HUFs, AOPs and BOPs only if the net total income is over Rs 8.50 lakh. In such cases, the tax payable along with the surcharge, is limited to the excess over Rs 8.50 lakh. Surcharge is payable by both Residents and NRIs.
I am a US citizen. I plan to sell my house in the US and purchase an apartment in India where I plan to eventually move to. I have my Accounts in NRNR/NRE in a bank in India. Will I have to pay taxes in India for social security money received and for any amounts I will deposit after the sale of my condominium in the US Also is it advisable to keep my Accounts as NRNR
Eventually I will cash in my 403B & IRA A/c when I turn 65 & deposit then also into my a/c in India. Also will I be allowed to live in India as a US citizen. Can I see dual citizenship
Mary Kurlakose, Oakland, CA 94611
Income tax is payable only on income. If the money transferred is capital in nature, the question of paying tax thereon does not arise. Transfer by itself does not create any tax-liability.
If your status for the Financial Year (FY) April-March is NRI or RNOR, the amount is tax-free without any limits.
However, if you are a Resident, your global income is taxable in India. If you are taxed in both the countries, India as well as your host country, the Double Taxation Avoidance Agreement between them will protect you. Such agreements between India and other countries, wherever they exist, are available on - www.incometaxindia.gov.in.
AP (DIR) Circular 28 dt 4.3.02 has discontinued NRNR Accounts from 1.4.02. ADs shall not accept any fresh deposits or renew these accounts after their maturity. The maturity proceeds of NRNR shall be credited to any NRE or even NRO account of the depositor. By default, it will be credited to his NRE account. The interest from NRE account becomes taxable from the date of your return to India. You may enjoy the RNOR status for a maximum of 2 years during which your income in foreign currency (interest from assets abroad and income abroad and interest from FCNR/RFC accounts in India) will be tax-free in India.
There is no embargo on a US citizen living permanently in India, provided your Visa allows you to do so. As regards dual citizenship, it is not yet available.
I have received the entire accumulated balance from a recognised PF fund (maintained by Company A) during 2002-03 for which I am filing tax returns. This consists of opening balance (transferred from earlier company B) and contributions made during my tenure in Company A.
The reason for withdrawal is that my current employer does not fall under the PF Act as there are only three employees. How do I treat the PF amount received for tax purposes The PF account was maintained for four years.
Ganesh M, firstname.lastname@example.org
The accumulated balance due and becoming payable to an employee participating in a recognised provident fund shall be excluded from the computation of his total income if, inter alia, if he has rendered continuous service for five years or more. It appears that your service was only for four years and, therefore, the entire amount, including the employers contribution, your contribution and the interest received, has become taxable.
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