Retirement is one financial goal that cannot be met through loans. It is important to begin early and develop an investment strategy for the longer duration. Revising the strategy as per different aspects during your lifetime is equally important.
With the increase in life expectancy, earlier retirement, and inflation, retirement planning has become more important that before. Joint family system is no longer prevalent in the country, which further makes planning for your senior years crucial.
A few common questions that come to mind while discussing retirement planning include:
- How much should I save?
- Where the money should be invested?
- When to start retirement planning?
The corpus needed for retirement is not same for every person and primarily depends on the personal situation. Starting your retirement planning immediately when you begin your working life is recommended.
Where to invest your money is discussed in detail in the following paragraphs. There are several options that could be used for creating your retirement corpus.
- Insurance companies’ retirement plans
Companies that offer life insurance offer bundled products, which include the advantages of investment and insurance coverage. During the accumulation phase, individuals pay the premiums and accumulate money during the policy duration. This amount is invested in different Insurance and Regulatory Development Authority (IRDA) securities.
During the vesting stage, the investors enjoy payouts from their accumulated corpus. The policyholder can choose this age, which generally varies between 40 and 70 years. Individuals can withdraw up to 33% of the corpus and avail the balance as a pension.
- Unit-linked investment plans (ULIP)
Income Tax Department has introduced a new section for AY 2-16-17 called Asset and Liability ,Schedule AL ,in ITRs which is applicable in cases where the total income exceeds Rs 50 lakhs. This article talks about Schedule AL or Asset and Liability In ITR.
Schedule AL, Asset and Liability Section in ITR
What is Schedule AL, Asset and Liability in ITR?
From AY 2016-17 or FY 2015-16, Any individual or Hindu undivided family (HUF) with total income of more than Rs.50 lakh in a year has to adhere to the new disclosure clause. According to the new norms, under Schedule AL, an assessee has to disclose the value of assets and liabilities that she owned as on 31 March 2016, while filing ITR for assessment year 2016-17. The information that needs to be disclosed is similar to what one had to disclose earlier while filing wealth tax returns.
Individuals and entities coming under this income bracket will also have to mention the total cost of such assets. So, while immovable assets like land and building have to be furnished under the new ITR regime, movable assets like cash in hand, jewellery, bullion, vehicles, yachts, boats and aircraft will also have to be disclosed .One also has to describe their “Liability in relation” to these high value items. The schedule AL, for ITR1, ITR2,ITR2A is shown in image below
Every employee needs to submit a declaration,Form 11, when he takes up new employment in an organisation which is registered under the EPF Scheme of 1952. This form, EPF Form 11, contains basic information regarding the employee and it is mandatory for an employee to fill it upon joining an organisation . EPF Form 11 is a self declaration by new joinee about his status whether he is a member or non member of EPF / EPS in earlier employments and opt out of EPF. This article explains what is EPF Form 11, goes through contents of EPF Form 11 and instructions on how to fill it.
EPF Form 11
What is EPF Form 11?
Form 11 is a self declaration by new joinee about his status whether he is a member or non member of EPF / EPS in earlier employments. This form is to be filled in by every employee at the time of joining the PF covered establishment. From this form the establishment and the authority ascertain the eligibility criteria of the employee as member of EPF / EPS. The purpose of form 11 is to make sure either of two things,
- (1) if the new employee was earlier a member of PF then he should be member of EPF.
- (2) if the new employee was not a member of PF in the past, or he was not in employment earlier and his salary is more than Rs 150,000 p.m. in the new employment, he can opt NOT to contribute for EPF / EPS. Such an employee is called as an excluded employee. A person receiving PF pension or persons who have withdrawn the PF are also excluded employees.
Form 11 is an important declaration form which enables the provident fund department to maintain records of employees, helping them during inspections and cross checking of facts. It also provides invaluable information about an employee to an employer.
Is Joining EPS compulsory? Can one just join EPF?
The members who join the EPF after 1971 have to became a member of EPS when they join EPF. The Family Pension Scheme came in to force in 1971, at that time option was given to then existing members whether to go for this new scheme or not. Many then members opted not to go for it. The Family Pension Scheme was converted to EPS in 1995
Can one opt out of EPF?
Online shopping has become a convenient and viable option for most Indians, as you can shop in comfort, without having to lug heavy bags around or go from shop to shop, comparing prices. You can find the best deals and even make payments online, using credit cards, debit cards or net banking.
To get started, all you need is internet access and a banking card. Shopping online will open a whole new world to you.
Advantages of Using Cards for Online Shopping
Online shopping is convenient and also cost efficient. Moreover, users are able to compare larger number of options from the comfort of their homes or offices, saving time and energy. Users can enjoy even greater benefits if they opt to pay for their online purchases using cards. Some of these benefits are discussed below:
- Earn reward points – Most card issuers offer users a rewards program on purchases made using their cards. The rewards can later be exchanged for other offers, such as flight tickets, movie tickets, free shopping vouchers etc.
- Cash back – Several institutions provide users cash back offers on money spent on their cards. This can help you further save on your total spending.
- Special offers and discounts – Card issuers often have tie-ups with online vendors to provide special offers for their cardholders. They can also enjoy additional discounts over and above the regular price reductions available for online shoppers.
- Equated monthly installment (EMI) options –Users can now purchasetheir dream products (high-end electronics, latest smart phones, etc.) without having to worry about the immediate financial charges some issuers give cardholders the option to pay for these purchases on EMI, which makes the products more affordable.
While there are several options to pay for your online purchase, most people choose to pay using their cards. In addition to the obvious convenience of making card payments, there are several benefits of using this option.
- Payment guarantee – With an ATM card, the payment is instantly credited to the vendors. The same is true for payments made through credit cards. With the latter, you have the additional benefit of not making the immediate payment out of your pocket. The card issuer gives you credit for the purchase that only has to be repaid with the next billing cycle. This gives you greater flexibility.
- Safe and convenient – Card payments are completely safe and conducted over secure gateways. They need user authorization, which provides protection and prevents misuse. You do not have to pay cash with this option.
- Offers – Most reputed banks, like Kotak Bank, Deutsche Bank, and HSBC, offer excellent and exclusive offers and discounts for online shoppers who pay through their cards. Several merchants and institutions even providecashback offers on purchases made using cards.
The growth in online ecommerce is not surprising considering the consumer benefits in terms of saved money and time. In addition to the immediate benefits, there are also gains to be made from the use of banking cards for such purchases. The combination of benefits is unbeatable and most consumers today do not need to think twice before shopping online.
Tejas Kunder is an independent blogger and writing has been his passion for a long time. A journalism grad, he loves exploring the world of sports, health, lifestyle and travel. When he’s not writing, he’s out on his bike discovering new places, apart from that he loves listening to music and catching up on the latest flick
Before filing the ITR one has to make sure that one owes no tax . If after calculating the income, taking care of deductions and deducting the tax already paid (TDS) one realises that one has piad less tax than due then one has to pay the balance tax. This tax is called Self Assessment Tax. One has to calculate the self assessment tax, pay the Self Assessment tax,update the ITR and then submit it. This article explains Self Assessment Tax in detail.
Self Assessment Tax
What is Self Assessment Tax
While filing income tax returns, one does a computation of income and taxes to be filed in the returns. Sometimes, the tax paid either as advance tax or by way of TDS is less than the actual tax payable . The shortfall of tax,which we owe, is called the Self assessment tax. This needs to be paid before Income Tax Returns are filed.
How can one pay less tax than due? Give examples of where one has paid less tax than due?
Interest from FD, Interest from Saving Bank account, short term capital gains are often the cases where a salaried person ends up not paying the tax due. Note if tax due in the financial year is more than 10,000 Rs you need to pay Advance tax else pay penalty under section 234B, 234C while filing ITR.
Less tax paid on Fixed Deposit
Say you invested in Fixed Deposit . Interest from FD is taxable as per your income slab. If interest on FD in a financial year is less than 10,000 Rs no TDS is deducted. if interest on FD is more than 10,000 interest is deducted at 10%. You have to pay tax on interest , even if you get interest at end of fixed deposit tenure.
Say you have earned interest of 11,535 of FD in the financial year (without TDS deduction) , TDS , at 10% of Rs 11535 i.e 1153.5, has been deducted then 11,535 is your income from other sources and 1153.5 should be claimed in TDS. So if you are in 20% slab(for FY 2015-16 income is more than 5 lakh) or 30% tax slab (for FY 2015-16 income is more than 10 lakh) then you owe tax and you need to pay 1153.5 or 2307 as tax.
Interest on Saving Bank Account more than 10,000