Short-term And Long-term Gains Harvesting

Everybody agrees that long-term gains are almost always preferable to short-term gains. I tend to agree in general. But there are exceptions too for example if you are a retired person like me :). Long term capital gains taxes are lower than the short-term counterparts. For example, short-term capital gains tax on equity is 15% vs 10% on long-term gains. Likewise, debt short-term capital gains are taxed at your applicable tax rate as opposed to 20% on indexed long-term capital gains. And here is your exception if you read carefully. What if your applicable tax rate is less than 20%? … Continue reading “Short-term And Long-term Gains Harvesting”

Franklin To Disburse Our Investment?

You probably remember the Franklin fiasco that happened some 9 months ago. All those who invested in the six wound up funds have their investments stuck for the past 9 months. While the funds were wound up they were still receiving interest income from the papers that it holds. Some papers matured while some others pre-paid the bonds. So overall Franklin has Rs. 14,391 Cr in income so far according to it’s latest report on Jan 29, 2021. Of this amount 4,621 Cr was used up to pay back its borrowings. The left over Rs. 9,770 Cr is available for … Continue reading “Franklin To Disburse Our Investment?”

Budget 2021 And How It Affects Me

Like last year, here is a quick overview of how the 2021 budget affects me. This is not an analysis or highlights of the budget. I am sure you can find many articles on those topics. This post is more specifically on how the budget affects my financial planning. To tell you the truth, there is nothing in the budget for me and that is a good thing! No news is good news isn’t it? Going into the budget speech many were worried if there will be additional cess and taxes to help government recoup revenue losses due to COVID-19. … Continue reading “Budget 2021 And How It Affects Me”

Tax Filler Script

The Indian tax filing has become even more tedious now. Going forward, starting from assessment year 2020-21 (financial year 2019-2020) one needs to report each and every equity redemption that results in long term capital gain in Schedule 112A. It used to be optional last year. Instead of reporting every transaction you could just report the aggregate value. But it is not optional anymore. This increases the burden on the tax payer especially if you have made a lot of small transactions. This change applies only to equity transactions that have incurred long term capital gains. So the debt transactions … Continue reading “Tax Filler Script”

How And Who Should Pay Advance Tax

I just payed my second installment of advanced tax, so I thought I will write down the procedure. It will be like a reference for me in the future and might help some one as well. It is actually a pretty simple process that does not really warrant a post, but here we go anyway. Who should pay advance tax? If the computed payable tax for a year exceeds Rs. 10,000, then you are liable to pay advance tax. For most salaried individuals the payable tax probably will not exceed this amount because your employer pays tax (TDS) on your … Continue reading “How And Who Should Pay Advance Tax”