Q) I am working as a teacher at a private school. My husband is working in Saudi Arabia as an engineer. Last year I had created fixed deposit of Rs 10 lakh, which was sent by my husband. Last year, the bank deducted Rs 17,000 from my interest income, although I had submitted Form 15G. I would like to file an I-T return. Please guide me with the procedure.
Manju Shree, Via email
A) The amount for fixed deposit has been contributed by your husband and hence it should form part of his total income. Since he is a non-resident Indian, the entire income received in India from various sources will be taxed in his hands. The tax deducted by the bank on these fixed deposits can be claimed only by filing a return of income of the relevant year. If the income is solely in the form of interest, the return of income needs to be filed in ITR1. If the income comprises of any other income apart from interest income (excluding income from business or profession), ITR 2 will have to be used. Further, ITR 3 will be applicable if the total income includes any income from business or profession.
Q) I am a Central government employee. I took a home loan of Rs 15 lakh from HDFC. I did not take the required permission before house construction from my authorities. So I want to get back my tax relief from I-T department. Please advise me regarding the procedure to claim the refund.
Satish, Via email
A) You shall be eligible to claim deduction for interest and repayment of loan on the said property. You can file a revised return of income for FY09 and FY10 before March 31, 2011. However, a revised return can be filed only if your original return was filed before the due date of filing of return.
Q) I own an ancestral property, which originally belonged to my grandfather. I sold it in January 2011 for a consideration of Rs 61 lakh. Please clarify:
1) What is the amount of tax that I have to pay on capital gains?
Q) If I have to invest either in bonds or in property, do I have to invest only the gain amount or the entire sale proceeds to avoid capital gains? If yes, then what is the time period within which I have to do so?
Nishidhar, Via email
A) If the property in question was acquired by your grandfather before April 1, 1981, the option of substituting the Fair Market Value (FMV) as on April 1, 1981, for the actual cost is available. The capital gains tax will be arrived after applying the cost inflation index to the cost of acquisition on April 1, 1981. Capital gains computation is not possible in the absence of complete information.
Tax on long-term capital gains (LTCG) can be saved if the LTCG is invested in the purchase of residential house within one year before or two years after the sale of property or construction of a residential house within three years after the sale of the property. The LTCG invested in specified capital gain bonds shall qualify for exemption under Section 54EC of I-T Act.
(Kamal Rathi is a chartered accountant,
representing Rathi & Malani, a Hyderabad-based accounting firm. Readers can mail their queries on income tax to kamalrathi.ca@gmail.com [1])
Links:
[1] mailto:kamalrathi.ca@gmail.com