You have bought an apartment in 2004 and sold it off in 2007. The profit from this transaction was invested to buy yet another property. Then are you eligible to pay capital gains tax?
In another situation, you pay a fixed monthly amount to your parents. Can you claim tax rebate on this outflow from your salary?
You earn more than Rs 2 lakhs per annum. Will you have to pay any tax in this case?
Tax expert Mahesh Padmanabhan of RelaxWithTax answered these and other tax related queries in a chat with Get Ahead readers on March 28.
For those of you who missed the chat, here is the transcript.
Part I -- Paid more tax? How to claim a refund
rkv asked, DEAR MR MAHESH, I HAVE 2 QUESTIONS: 1) I HAVE BOUGHT AN APARTMENT IN 2004. BUT NOW I HAD TO RELOCATE AND I SOLD THE OLD ONE AND PLAN TO BOOK A NEW ONE IN MY NEW LOCATION. IF I ROUTE ALL THE PROFIT I GOT IN SELLING MY FIRST APARTMENT TO THE NEW APARTMENT, WILL I HAVE TO PAY CAPITAL GAIN TAX? 2) CAN I GAIN TAX BENEFIT FOR THE LOAN REPAYMENT OF THE HOUSE I BOUGHT FIRST?
Mahesh Padmanabhan answers, In case you have held the first house for more than 36 months, then you can avoid paying capital gains tax by reinvesting in a new property. Such capital gains would be treated as long term gains and accordingly is eligible to certain exemptions. In case if the property is disposed within five years, then no deduction is available in the year of repayment for the principal component. Also, the deduction availed in the earlier years would be taxable as income in the year of repayment.
Darshan asked, Dear Sir, Is there any tax rebate available if I give a certain amount per month to my parents (father - retired & no pension and mother - housewife) for their personal or any other expenses? I had read something similar to this in a magazine a couple of months back.
Mahesh Padmanabhan answers, No, there is no deduction available for payments made to parents for personal expenses.
Pawannathani asked, if the employer has not calculated the exemption of HRA, whether the assessee can claim the same while filing his/her income tax returns?
Mahesh Padmanabhan answers, Yes, you may claim the exemption of HRA in your returns independently. However, you would need to have a statement certified by your employer as to the breakup of your salary (such as basic, DA, etc). This would make way for clear working of the HRA exemption and would be acceptable by the IT authorities
eddy asked, Sir, in the financial year 20006-07, the company has deducted me more than tax. That is my pay slip tells that... Total tax payable: Rs 4,244 Tax deducted so far: Rs 6,613. What do I need to do to get back the remaining amount from the government? Please advice.
Mahesh Padmanabhan answers, By filing your IT returns, you could claim back the excess tax deducted by your employer.
snvsanjay asked, My Income is Rs 2.15 lakh and I Invested Rs 1 lakh , What tax will I have to pay?
Mahesh Padmanabhan answers, In case there is no specific salary structure that could reduce the taxable salary, then the tax payable would be Rs 1,530.
Sandesh asked, Dear Mahesh, I have taken an personal loan from my brother and has been paying Rs 11,000 per month. Is there any way wherein I can claim tax deduction for the said amount?
Mahesh Padmanabhan answers, In case you have an agreement with your brother as to the loan taken and the terms of loan, then you could at least claim the benefit of interest deduction included in the installment you pay.
Sandesh asked, Dear Mahesh, I have taken an personal loan from my brother and has been paying Rs 11000/-p.m.Is there any way wherein i can claim tax deduction for the said amount?
Mahesh Padmanabhan answers, This is provided you have taken this for the purpose of acquiring a house
Arun@20 asked, My Parents asks me to take PPF worth of Rs 35,000-40,000. Is that enough to axe the Tax?
Mahesh Padmanabhan answers, Whether this is adequate depends on the income chargeable to tax. Another point is the liquid funds available with you for making further investments.
sksingh asked, There has been regular deduction of TDS from my salary but I have not filed my tax returns. Will there be any more deductions from my salary?
Mahesh Padmanabhan answers, Deduction of tax from your salary and filing of IT returns are two independent issues. The TDS provisions apply to your employer whereas you are separately required to file your returns.
Vinod asked, Is there any way to get gift tax benefit (parents or siblings ) which can be waived in TDS? What section covers the gift tax? Is there any limit for that?
Mahesh Padmanabhan answers, Amounts received without suitable consideration cab be included as taxable income under the head Income from Other Sources. However, such amounts are not taxable under certain circumstances such as amounts paid by a relative. Again the definition of relative has been framed under the IT Act.
prakash asked, for an individual with income from other sources can he pay rent to a family member and claim deduction under which sec and what is the limit?
Mahesh Padmanabhan answers, Yes there is a deduction available for individuals paying rent under section 80GG. However, the relevant conditions mentioned in the said section needs to be complied to avail of the deduction. The maximum amount of deduction available is Rs 24,000 per annum.
Mahesh Padmanabhan says, Its time to leave friends, thanks for your posting your queries. We could meet in another of such chat sessions. Thank you and have a good day.
Part I -- Paid more tax? How to claim a refund