RBI Yet To Notify Repatriation Amount Limit

Updated: Dec 22 2002, 05:30am hrs
I heard that policies issued by LIC is backed by Government sovereign guarantee, as per LIC Act. Is it true Please explain. Rajesh Patel, raju_varsha@rediffmail.com

I am amazed at the misconstrued idea of safety that not only you, but the public at large carry with them. All that I have to ask you is that if LIC is not safe, with or without the guarantee, what is safe I throw the same request you have thrown at me in the concluding sentence of your note --- Please explain. Do you really feel that the Government sovereign guarantee gets higher safety rating than the unrated sincere and trustworthy management

Have you heard that some companies who floated their bonds or debentures with highest ratings at their launch because of the guarantee given by state government are today rated as junk Today it is the state government guarantee and tomorrow it may be the central government guarantee which will be looked at with several question marks, but I feel that LIC will get the highest rating for all the times to come. The only query you have to ask yourself on this issue is --- Do I really need to insure my life and if so, by how much

I purchased a house for Rs 3.34 lakh by taking a bank loan of Rs 3 lakh. I paid Rs 56,000 towards stamp duty and Rs 7,000 towards registration fees for transferring the property in my name.

I want to know whether the stamp duty and registration fees paid by me will be eligible for deduction from my income, and if so, under which section Subash K Patnaik, p_lipsa@rediffmail.com

Any payment made by an individual or HUF towards cost of purchase or construction of a residential house, (not necessarily self-occupied) qualifies for the deduction with a ceiling of Rs 20,000 subject to the overall monetary limit of Rs 70,000 (this is not infrastructure) in respect of stamp duty, registration fee and other expenses incurred on transfer. This expense need not flow from borrowed funds. These expenses shall not include:

i) Admission fee, cost of share or initial deposit;

ii) Cost of any addition, alteration, renovation or repairs carried out after the issue of the completion certificate or the house is occupied by the assessee or it has been let out; and

iii) Expenditure where a deduction is separately allowable u/s 24.

Such a house is required to be held for a minimum period of 5 years from the end of the FY in which its possession was taken. If the house is sold earlier, aggregate rebate claimed shall be added to the tax liability on normal income of the assessee for the year during which the house is sold.

I bought a second house very recently. I took a bank loan for both of my houses. The first house was bought by me last year. I heard that the tax exemption will be given only for one house. Is this true If the interest paid by me in a given year is less than 1.5 lakh, will I get exemption from both the loans Durga Prasad

Since you own two houses, one will be treated as self occupied and the other will be treated as let out even if none of these are let out.

The annual value of the one treated as self-occupied will be considered as nil. The interest payable against the loan taken for this house can be set off against the annual value subject to certain limits. The interest payable for the loan taken for the house let out or deemed let out can be adjusted against the annual value in full.

If the income from house property is negative it may be adjusted against any head of your other income.

If both your houses are let out the annual value of each will be calculated as per the Act and entire interest payable on the relevant loans can be set off against the income from house property.

There is no restriction on the number of houses one can own and claim the set-off of interest payable on the loans taken for housing property.

The limit of Rs 30,000 or Rs 1.5 lakh is available for each loan taken for purchase of different houses.

We are migrating to US after obtaining Green Card. How much US Currency can I take along with me from India Some say that you can take $25,000 whereas some other say that the limit is $5,000. Manish, worldrealtors@hotmail.com

Yes, you are right. There is a confusion in this regard.

The RBI has issued a press release on 12.9.02 stating that in order to facilitate setting up base abroad, it has enhanced the repatriation limit from $5,000 to $25,000 to residents who have obtained emigration visas. The notification in this regard is still awaited.

(The author may be contacted at anshanbhag@yahoo.com)