I am 35 years, married and residing in Davanagere with wife and 5year old son. I had availed a family floater health insurance plan 3 years ago. Recently I got diabetes but I take medicines to keep my diabetes and blood pressure normal. Should I inform this as a disease? What will happen if I don't disclose this condition?
Health insurance plans cover pre-existing ailments but after a period of 36-48 months. Some plans cover pre-existing ailments even before 36 months. This coverage of pre-existing diseases is conditional upon the buyer honestly making all medical disclosures at the time of buying the policy. This means that in case a person actually suffers from a disease at the time of buying the policy but i [...] View More
I am 30 years, single and reside in Bengaluru. I invested INR 1 Lakh in different stocks to make a quick profit. I made a profit of INR 45,000 through intraday trading. My friend has told me that I have to pay tax on this profit. Is this true? Can I escape paying this tax?
Any person, engaged in intraday trading is automatically treated as someone who is engaged in a business and his income shall be assessed as Income earned from Business and tax rate shall be same as any other business activity. Intra-day trading transactions are treated as speculative transactions and the net income earned, after deducting eligible expenses incurred to earn the profit, is taxed as [...] View More
I am 24 years, single and residing in Mysuru.I have just started working and plan to avail a term life insurance plan, but am not sure I require it as I am single. My friend has told me a term life insurance plan is useless for me and I must avail an accidental insurance plan which is much cheaper. I am confused. Please advice?
Life Insurance is meant to protect your family against uncertainties. At a young age, the likelihood of death due to a natural causes seems extremely low. However, it is not improbable. These days even young people do encounter critical illnesses such as heart diseases or stroke.If your parents are dependent on your income thenterm insurance can protect the future of your parents in uncertain circ [...] View More
I am 45 years married with a daughter and reside in Raichur. I have invested INR 2 Lakhs in an equity mutual fund scheme. I also have invested INR 1.5 Lakhs in stocks. I have assigned my brother as the nominee for my mutual funds and stocks. I have made my WILL and named my daughter as the inheritor of my mutual funds and shares. Is it necessary for me to change the nominee as I have named my daughter as the inheritor of my shares/equity mutual funds?
According to law, a nominee is a trustee not the owner of the assets. In other words, he is only a caretaker of your assets. The nominee will only hold your money/asset as a trustee and will be legally bound to transfer it to the legal heirs. In the case of an unfortunate occurrence, the nominees will be able to get the units transferred to their name relatively easily, compared to a case wher [...] View More
I am 42 years married and reside in Bidar. I have taken a loan of Rs 20 lakh against my property worth about Rs 70 lakh and am paying an EMI of Rs 24,000. I have a delayed track record of payment. I am looking at taking a top-up loan of Rs 10 lakhs as I need funds to scale up my business. Is there a possibility of getting this loan?
Banks/NBFC's consider your income, repayment behavior across the loans and valuation of the asset pledged you have already availedfor deciding your creditworthiness.All past loan repaymentsare recorded in your credit report. If you pay your EMIs on time your credit history will be good and you get a good credit score. Likewise, your credit history is adversely impacted by any delays or defaults on [...] View More
I am 51 years married and reside with 2 sons in Dharwad. I had availed a loan against my property for a financial emergency. I also used part of the loan to pay the engineering fees of my son. I have heard that there are tax benefits on an education loan. Can I get the tax benefit even though I have not availed an education loan?
You get a tax benefit under Section 80E if you avail a loan for the higher education of self, spouse or children. Deduction can be claimed by an individual only if the loan has been taken in his/her name. The deduction allowed is the total interest part of the EMI paid during the financial year. There is no limit on the maximum amount that is allowed as deduction. No Tax benefit is allowed for the [...] View More
I am 38 years married and reside in Mysuru. A friend of mine recently lost his eyesight due to medical negligence of the doctor.I have availed a health insurance plan and have 2 doubts: Is there any health insurance plan which specifically covers disability due to medical negligence of the doctor? Are the premiums for this kind of a policy expensive?
Most health insurance policies cover treatment costs for disabilities that may be because of third party negligence. You don't need to look at any specific health cover which covers disability due to medical negligence of the doctor. If a person loses his eyesight due to medical negligence of the doctor, the health insurance plan takes care of the hospitalization expenses. You must also consider a [...] View More
I am 47 years old married with a son and residing in Hassan .My son is 15 years old and has just completed his SSLC. A friend has recommended that I avail a traditional child life insurance plan for him to take care of his expenses. Will this plan pay money needed for my son's college education? Please advise.
A child life insurance plan is an investment plan that pays a benefit that is linked to milestones in your child’s life. Its purpose is to build/accumulate a corpus for a child's future needs. Marriage and a college education are the main reasons to invest in a child life insurance plan. These plans generally have an inbuilt waiver of premium rider that keeps the insurance active for the child e [...] View More
I am 41 years married with a son and reside in Bengaluru. I started a hardware distribution business in 2013 with a capital of INR 20 Lakhs and even offer my products on a popular ecommerce marketplace. I put my own money in this business.My business has a turnover of INR 1 cr. Now I require a business loan of INR 2 Crores to fund my working capital needs. Should I avail this loan from a bank or are there better alternatives? Please advise
To raise working capital in India, you can approach a bank. Banks generally ask for Audited financials of last 3 years, Bank statements of previous 6 months, VAT / sales tax returns, Identity proof and address proof documents. If you are not comfortable availing a business loan from the bank, you can avail this loan from an NBFC. 1. NBFC's have quick registration and you don't need to stand i [...] View More
I am 45 years married with a son and residing in Bidar. I had availed a home loan of INR 35 Lakhs 4 years ago from a reputed bank to buy a house in my hometown where I reside. I enjoyed tax benefits on this home loan. I now plan to sell this apartment and invest the money in a business as I have no further need of it and pay back the home loan. A friend has told me I will lose the tax benefit I previously enjoyed. Is this true?
Your Home Loan EMI consists of Principal and Interest component. The principal component is allowed as a deduction under Section 80C, up to INR 1.5 Lakhs a year. However, if you sell your residential house/apartment within five years, you may have to forgo your tax benefits. The entire amount of deduction claimed under Section 80C in prior years on the amount of the principal repayment will be add [...] View More
I am 61 years married with 2daughters and residing in Raichur. I have 2 health insurance plans which are not cashless. I want to convert these plans into cashless health insurance plans. Is there any way I can do so. Please advise?
You can port your health insurance plan at the time of renewal. You may port your policies into any health insurance policies that offers cashless facility at a wide network of hospitals. You need to keep in mind that cashless hospitalization is just a facility, not a benefit. 1. You should also pay attention to the list of hospitals on the prospective insurer's network and also find out whet [...] View More
I am 45 years old married with a son and residing in Bellary. I have availed a life insurance plan with a critical illness rider. I availed this life insurance rider so that if I suffer from a critical illness, I will get money for the treatment of the disease. My friend tells me a critical illness rider has a waiting period and if I do not survive this I will not get the amount. Is this true?
A critical illness rider provides a lump sum in case you get afflicted by one of the specified diseases like cancer, heart attack, kidney failure or a stroke. Your claim becomes payable when the illness has been diagnosed. Claims are only paid if the insured survive a waiting period. The waiting period is between 30 days and 180 days. There are a few critical illness riders available which do [...] View More
I am 35 years married and reside in Raichur. Recently I have been facing financial problems and have been withdrawing all the money from my savings bank account. I have SIPs in 2 different equity mutual fund schemes that go out from this savings bank account every month. I may not be able to service those SIPs for a few months. My friend has told me there could be penalties for temporarily stopping SIPs? Please advise.
SIP investments are commitments that an investor makes to his/her own self and future financial well-being. They are not obligations made to the mutual fund companies. If you decide to temporarily suspend your SIP investments, there will be no penalties imposed on you. However, your bank may charge a penalty if a debit request from the asset management company (AMC) cannot be honored due to lack o [...] View More
I am 31 years married with a son and residing in Bengaluru. My husband worked for a Company in the last financial year as an employee which he has since quit. The Company deducted tax and it is reflecting in Form 26AS. The Company has not given my husband Form 16. If my husband files ITR based on the tax deducted by the company and the income received, will it be acceptable? Where should I complain for not getting Form16?
An employer is obliged to make the payment of tax deducted from the salary of an employee and he is obliged to file a TDS statement in Form 24Q giving the complete details of the employee including PAN of the employee. Once the TDS statement is processed and accepted by the TDS department, the amount of TDS is reflected in the Form 26AS of the employee. 1. In your husband's case, the employer [...] View More
I am 25 years old and am planning to buy health insurance. However, I consume alcohol occasionally. I am willing to disclose it in the proposal form. In the policy clause of most insurance plans I found an exclusion section which says, “The company shall not be liable to make any payments under this policy in respect of any expenses what so ever incurred by the insured person in connection with or in respect of use of intoxicating drugs/alcohol.” I want to know if: 1. Does it mean that I will not be covered for all illness/ailments which can be traced to alcohol consumption? 2. Are there any health insurance policies available specifically for those who consume alcohol?
You should disclose your alcohol consumption if the proposal form asks for it. Most insurers will accept applications from people who drink in moderation without any premium increases. The exclusion you refer to typically excludes cases that are caused due to abuse of alcohol or drugs. You need to be careful of the interpretation of this clause: 1. There have been a few cases where insurers h [...] View More
I am 36 years married and residing with a 4 year old daughter in Tumkur. I had applied for a home loan from a reputed private bank near my home to book an under construction apartment. I provided all the required documents to this bank personally and through my builder. Later, when I joined a new company , the bank demanded that I re-submit all the documents. I provided all the documents. But even now my loan has not been sanctioned. What can I do?
You need to write to the bank's nodal officer about this issue. Normally, a housing loan application is processed within five to 15 days and if the bank wants additional information or clarifications, the same has to be sought within a reasonable period. 1. The bank is supposed to inform the client if the proposal is accepted or rejected. In case of the latter, the bank has to communicate the [...] View More
I am 60 years married with 2 children and reside in Raichur. I had invested INR 5 Lakhs in a reputed equity diversified mutual fund about 5 years ago. This amount is today worth INR 7 Lakhs. I needed this money badly and applied for redemption. The mutual fund house refused my redemption request saying there was a signature mismatch. With advancing age handwriting changes. Please could you suggest me a way to redeem my money. Kindly advise?
When a redemption is rejected due to signature mismatch, you would need to go to your bank (preferably the bank that holds the account attached to the mutual fund folio), and get the signature attested by the bank manager. The bank manager would attest to your identity and require you to sign the request in his/her presence. Then, he/she would certify the signature stating that it is indeed your s [...] View More
I am 31 years old married with a son and residing in Bidar. I have availed a term life insurance with a critical illness rider for 30 years, which means I will get cover till the age of 61. Should I be looking to purchase another critical illness in some years to get the benefit beyond 61 years or should I be dependent on my savings to cover for major illnesses post 61?
A critical illness cover is very important especially for those in higher age groups. In your case, critical illness cover beyond the age of 61 would be vital to ensure you are adequately covered. A critical illness policy can be bought as a stand-alone policy or as an add-on, popularly known as rider, on a life insurance policy. In fact, some of the health insurance plans come bundled with critic [...] View More
I am 35 years married and residing in Bengaluru. I had availed a floating rate home loan (taken in 2013), which is partially disbursed at the rate of 10%. The approved amount is INR 25 lakh and I have been disbursed INR 18 lakhs. I am paying a pre-EMI of INR 15,000 each month. Can I switch to different bank for a partially disbursed loan? Please advise?
You can switch your loan to another bank even if it is partially disbursed. You can convert your partially disbursed loan to a fully disbursed loan and convert your pre-EMI to an EMI. You are paying a high interest rate as apparently the interest rate on home loan is linked to the base rate and not the marginal cost of funds rate (MCLR). This has to be converted to an MCLR rate. MCLR is closely li [...] View More
I am 26 years unmarried and residing in Belagavi. I earn a salary of INR 4 Lakhs a year. I will file ITR by July 31st 2017 but I plan not to mention the profits/capital gainsof around INR 50,000 I have made in the stock market. What kind of penalties are levied by the tax officer if I am caught. Kindly advise?
The last date for filing your income tax returns for the financial year 2016-17 is just a few days away, 31st July 2017. While filing your return, you are supposed to disclose all your incomes under all the income tax heads, irrespective of the amount of income or whether the income is considered tax-exempt or taxable. You may have to pay penalties if you under-report your income while filing your [...] View More
I am 32 years married with a daughter and residing in Mysuru. I am impressed by the ads on mutual funds by AMFI and want to invest in equity mutual funds. A friend has advised me to take a look at dynamic equity funds. What are these funds? Are they good to invest?
Equity investors pour more money into the markets when they are going up and stay away during downturns, which can hurt returns. To protect investors from such behavioral bias, there is a category of mutual funds called dynamic equity funds. Dynamic equity funds manage their equity portfolios, by investing more when markets are down and less when they are up. 1.Dynamic equity funds tweak thei [...] View More
I am 44 years married with a son and residing in Dharwad. I had availed a family floater health insurance plan about 5 years ago and regularly pay the premiums. Recently I took up a preventive health check up package with a prominent hospital. Can I get a tax benefit for the money I have paid for the health check-up under Section 80D? Please advise?
Killer diseases like heart ailments, cancer, stroke and diabetes can by far be prevented, if diagnosed early in their stages. This can be achieved by regular preventive health check-ups. Within the maximum limit of INR 25,000, you get a benefit of up to INR 5,000. This means, if you pay premium of INR 20,000 towards your health insurance premium and undergo a preventive health check-up costing Rs. [...] View More
I am 36 years old married with a daughter and reside in Hubballi.I had[NB1] availed an endowment life insurance policy a year ago and paid a premium of INR 15,000. I took this life insurance policy on advice of a friend to get the tax benefits. Now I don't want this life insurance policy and plan to surrender it. What will happen to the tax benefits I got last year?
By surrendering a life insurance policy, you lose out on all the benefits of the policy and receive a much lower amount than the premium you have already paid. If you want to discontinue the endowment plan, there are two options: 1. Convert this policy into a paid-up policy without exiting it. The Sum Assured of the policy is reduced in proportionate with the number of premiums paid and tota [...] View More
I am 41 years married and reside in Chikkamagaluru. I have been working with an MNC Company for the last 7 years. I have availed a joint home loan with my spouse a year ago and pay EMI's regularly. I have heard that I can withdraw money from my EPF to pay back the home loan? If yes, then how much? Kindly advise?
The EPFO allows you to withdraw money from your EPF account to fund the purchase or construction of house or flat or to buy land. EPFO members will be able to withdraw up to 90% of their accumulation (employer's as well as employee's contributions, including interest) in the PF account or the cost of the property, whichever is less to provide for the purchase or construction of house/flat or for b [...] View More
I am 40 years married with a daughter and residing in Bidar. I had changed my job in the last financial year and I now have 2 Form 16's. I plan to e-file my ITR all by myself. I am confused as I don't know how to file ITR with 2 Form 16's. Kindly advise?
If you plan to e-file your returns on the income tax website all by yourself, you will have to first get both the Form 16's with you. Your employers have given you Form 16 which will have details such as gross total income from salary, tax deducted at source and deductions under 80C. 1. First, you have to pick the right ITR form and then provide general information such as address, full name [...] View More
I am 38 years married with a son and residing in Bengaluru. I have a term life cover of about INR 50 Lakhs and a health cover of Rs 2.5 Lakhs under a group health plan provided by my employer. I have an annual income of INR 15 Lakhs. Last year I was hospitalized for a week with acute vein thrombosis. I am on medication, but fine. I have tried to get additional life and health insurance cover from a number of insurers, but failed. Is there any way I can get cover? Please advise?
Insurers hesitate to insure you if you have undergone surgery or have major treatment history. You have undergone treatment recently and this stands against you. If you want enhanced cover you must consider 2 options: 1. You must apply for a regular individual health insurance plan with a low sum assured, say around INR 5 Lakhs as large insurers would be less lenient when underwriting a lesse [...] View More
I am 41 years married and residing in Raichur. I have been following and studying equity mutual fund schemes on various websites for the last 6 months to study their performance.I plan to invest in an equity mutual fund scheme soon but I have a doubt. Most schemes have compared themselves with a benchmark index. Why do different funds have different benchmark indices to compare with? Is it the right way to judge a scheme? I am confused. Please advise?
The purpose of having a benchmark for a fund is to be able to compare returns between a passive investment instrument (index) and an actively managed fund and thus determine the value that the fund manager is delivering to your investment. Depending on the category a scheme belongs, a benchmark index is chosen that is appropriate. 1. For example, a large-cap fund that invests in the largest com [...] View More
I am 41 years married with 2 children and reside in Shivamogga. Recently I fell into difficulty and approached a private bank for a personal loan of INR 2 Lakhs. They offered me a loan at an interest of 13%. I was surprised to find that my home bank was charging me more than some of the other private players whom I approached. This is the first time I am taking a personal loan of any kind. Is interest rate the only factor while deciding on the lender or is there something else I need to see? Please advise?
Choosing the right lender to avail a loan depends on multiple factors, but interest rate is definitely an important one. You also need to check the tenure of the loan, eligibility in terms of loan offered, processing charges, penalties, speed of disbursal while deciding on a lender. 1. It is possible in certain scenarios that the rates offered by some banks may be better than your home bank. Y [...] View More
I am 25 years, unmarried and reside with parents in Mysuru. I work for a reputed IT Company where TDS is deducted. I have been ignorant and not filed ITR. Will I have to pay a penalty for this? What happens if you miss the deadline of filing Income Tax Returns?
You have to file ITR even if TDS has been deducted from your salary. The finance ministry has said it won't extend the July 31 deadline for filing income tax returns this year, however, it got extended to 5th August. The government has not put any monetary penalties for crossing the deadline of July 31st. The penalty proposed for people missing the deadline doesn’t apply till next year and [...] View More
I am 32 years married and residing with daughter in Bengaluru. I have been investing in ELSS via SIP for the past 2 years. Recently, I have been hearing a lot about liquid funds. I want to invest in these liquid funds, but I am confused. Are these liquid funds safe?
ELSS is a type of diversified equity mutual fund which is qualified for tax exemption under section 80C and offers the twin advantage of capital appreciation and tax benefits. It comes with a lock-in period of 3 years. SIP allows you to invest a certain pre-determined amount at a regular interval (weekly, monthly, quarterly, etc.). 1. Liquid funds are the least risky of all mutual funds and inv [...] View More
I am 48 years married and reside in Bidar. I had availed a family floater health insurance with a reputed general insurer for the past 4 years. Recently, I had undergone a heart bypass surgery and incurred a medical bill of INR 3 Lakhs. These bills were settled through my corporate medical insurance plan. Do I need to intimate the insurer of my personal health insurance plan about this bypass surgery?
It is not compulsory for you to intimate your insurer with whom you have this health insurance plan about the bypass surgery. You need to do so only if you are applying for a change in the terms and benefits of the policy or an increase in the cover limit. However, if you want to apply for an increase in the sum assured, you will have to disclose this bypass surgery and any change in the health st [...] View More
I am 33 years married with a son and reside in Shivvamogga. I had availed a home loan from a reputed bank and was paying EMI's regularly for the last 8 years. I quit my job for a new job, but due to some reason I could not get that job. Now my Financial condition is very bad. How can I resolve this problem until I get a new job?
We are sorry to hear about your troubles and we hope that you are able to recover from this tough situation very quickly. As regards your home loan EMI payments to the bank, you do have a few options. 1. You can meet the loan officer, explain your financial situation and request for a grace period during which you will not be required to make EMI payments. The bank may charge some penalty for th [...] View More
I am 41 years, married and and reside in Bengaluru with wife and daughter. I, my brother, my mother and sister have decided to sell our house which was bought in August 2010. This house is on my late father’s name. We had bought the house at Rs 20Lakh and plan to sell it for Rs 65Lakhs. Can you tell me how much tax each of us has to pay? Can this tax be saved? If I take this house as a gift and sell it to a third party, will it reduce my tax liability? Kindly advise.
The sale of the house property inherited by you and your family will attract capital gains tax. As the property is inherited, the period you have held this property would include the period of holding by your father. If the property was held for more than 24 months, the gains resulting from the sale would be taxable as (LTCG). 1. You will be taxed in respect of your respective share of LTCG at [...] View More
I am 34 years married with a son and reside in Mysuru. I have been investing in FD's since the last 10 years. Recently, My friend told me that debt mutual funds give higher returns than FD's. Is this true? Kindly advise.
Yes, debt funds have the potential to generate higher returns than FDs on a post-tax basis. Income funds are a type of debt mutual funds that Invest in a combination of government securities, certificates of deposits, corporate bonds and money market instruments. They are managed by expert fund managers who seek to generate returns both in declining and rising interest rate scenarios by managing [...] View More
I am 68[NB1] years married with no children and reside in kalaburagi. My wife who is 66 years and I are covered under a group mediclaim scheme. My wife had a minor surgery, but the TPA has not yet processed my claim. Can I lodge a complaint against the TPA. Please advise?
First you have to check if the minor surgery is covered under the group mediclaim scheme. If it is covered, you should approach the grievance department of the insurer for the non-settlement or delay in the claim settlement. IRDAI guidelines state there should be a separate grievance cell for senior citizens. Insurance Regulatory and Development Authority of India (IRDAI) is sensitive to the speci [...] View More
I am 45 years married with a daughter and reside in Chikkamagaluru. My brother and his wife passed away in an accident last week in which their car was totally destroyed. They have no children. My brother made me the nominee of his term life insurance plan. When I lodged the claim with the insurer, they asked me for a legal certificate. What should I do?
As per new insurance rules, the concept of beneficial nominee has been introduced. A beneficial nominee is the spouse, child or parent of the insured. On death of the insured, the beneficial nominee becomes the ultimate beneficiary of the proceeds, irrespective of other legal heirs to the deceased’s estate. Nominees other than beneficial nominees are only the custodian of the legal heir. Insurer [...] View More
I am 39 years married with a son and reside in Belagavi. I had availed a home loan of INR 35 Lakhs from a reputed bank about 10 years ago and have regularly paid EMI's. The last couple of EMI's are left and my dues are cleared. Do I have to inform the bank on the loan been completed. Please advise?
Congratulations on clearing the home loan and being the proud owner of your own home. Irrespective of whether you are closing your loan at the end of the tenure or prematurely, keep these points in mind to ensure a successful loan closure. 1. Once all the payments towards your loan are done successfully, request the bank to issue a no objection certificate (NOC). Do not fail to check if the NOC [...] View More
I am 36 years married with a daughter and residing in Bengaluru. My uncle 57 years old had bought units from 4 mutual fund schemes. He recently passed away, making me the nominee of all these funds. My uncle had not done the KYC and I am worried. What should I do now to redeem the units? Will mutual fund houses consider my KYC?
You first need to get the mutual fund units transmitted in your name, and only then you would be able to redeem them. Transmission is the process by which units of a deceased account holder are transferred to the nominee. To get your uncle's mutual fund units transferred you must: 1. Write a letter to the AMC requesting transmission of units in the format prescribed by the fund house. 2. Su [...] View More
I am 39 years, single and residing in Mysuru. I am insured under the corporate cover of my company. I do not have any pre-existing diseases. I plan to retire at 50. Can I retain my corporate cover of INR 3 Lakhs even after retirement? Should I opt for a super top up health insurance plan as I already enjoy corporate cover?
You can continue with your corporate cover, but remember to convert the corporate coverage to an independent individual health cover with the same insurer when you exit/retire from the company. Involve your HR department in converting your policy to enjoy all benefits, which were available in the corporate cover. With steadily rising hospital and medical costs, you must take two additional cove [...] View More
I am 39 years married with a son and reside in Davanagere. My brother who is 37 years had bought a term life insurance plan on 3rd July 2017. He completed all formalities and the term life insurance policy had been accepted by the insurer. Before the policy document reached us my brother passed away on July 15th. My brother had made his wife as the beneficial nominee. Can we make a claim on this term life insurance plan as the policy documents have not reached us? Kindly advise.
Sorry on your loss. Yes, the term life insurance plan of your brother is considered to be in force. The receipt of the hard copy of the policy is not mandatory/a prerequisite, for the risk cover to be effective. Term life insurance policies have no waiting period. So, coverage is immediately applicable. The only exception is that suicide is not covered in the first year of the policy. 1. The in [...] View More
I am 37 years old and resident of Karwar. I had availed a car loan from a reputed public sector bank around 4 years ago. I have regularly paid my EMI's and now I have only 2 EMI's left. Do I have to inform the bank while closing out this loan? Kindly advise.
When you buy a car via a loan, the car is hypothecated to the lender/bank. The car is pledged with the bank, while the car remains with you. The hypothecation letter is part of the car registration papers. Once you have paid all your EMIs, you must make sure to change the owner's name in the papers. Though the Car remains with you, it is hypothecated to the bank. If you default i.e. does not pay [...] View More
I am 26 years unmarried and reside in Mysuru. I work for a Company and filed my ITR for the first time before August 5th 2017. My friend has told me there is a way to verify if my returns have been filed. Is this true. I don't know much about ITR as I am filing returns for the first time.
If you happen to be among the new ITR filers, remember that after you file the return, you have to verify it. You can do it offline as well as online. If you opt for offline verification you have to download the ITR-V (acknowledgement form), sign it physically and mail it by ordinary post or speed post to the Income Tax Centralized Processing Centre (CPC) within 120 days from date of uploading th [...] View More
I am 43 years married with a son and reside in Bengaluru. I work for a reputed Company and have a corporate health plan. I also have a family floater health plan and an individual health plan. If I want to make a claim in what order should I make a claim to lower or retain my premium outgo?
You have multiple health insurance plans and you have the right to choose the policy to make your claim. The main criteria here is, the health insurance plan should provide the cover for the ailment, for which the claim is being made. 1. If the claim amount exceeds the sum insured opted for in the policy, then you can make a claim on the other health insurance plans. 2. It is important to n [...] View More
I am 35 years old resident of Madikeri. I have three mutual fund SIPs and my money gets auto-debited on the first of each month from my bank account. I recently changed my job and now my salary gets credited on the 10th of every month. Is there any way I can change the date of debit?Kindly advise?
The change of date for your SIPs can be done by submitting an SIP transaction slip. Every mutual fund company has such a common transaction slip, using which any such changes can be taken care of. A better way to manage your SIPs would be to use one of many digital platforms that are available for this purpose[NB1] . 1. You[NB2] can easily issue a one-time mandate that will allow you to set-up [...] View More
I am 30 years married and reside in Chikkamagaluru. I had invested about INR 5 Lakhs in three reputed equity mutual funds via SIP. I have made 20% average profit within a year on these funds and my friends have advised me to sell them. Is this a good move. Please advise?
You should be guided by your financial goals when you invest in an equity mutual fund.You should sell a fund and get your money out when you need it. Check your financial goals and decide why you have invested in equity mutual funds. You should stay invested for around 4 to 5 years, continue your SIPs, till the money has grown to what you need.Now, your financial goal may be money for a down pay [...] View More
I am 45 years married with a son and reside in Shivvamogga. My business is doing ok, but times are bad and I am facing difficulty repaying the loans. My creditors are good people but I am worried that if something happens to me, my wife will face tough times. I plan to avail a term life insurance plan to protect my family. I am worried that if something untoward happens to me, these creditors will take the money my wife should get. What to do?
You must take this term life insurance policy and get it endorsed under (MWPA) Married Women's Property Act. This simply means that any insurance policy taken by you on your own life and which is endorsed under the MWPA in favor of your wife or children, will always be their property. None of your creditors will have any right over the policy or the death benefits. Take a look at these points: 1 [...] View More
I am 28 years and reside in Mangaluru. I have been working for the last 4 years. I earned a salary around INR 3 to 4 Lakhs each year and filed ITR. In my third year of working (Financial Year 2015-16), I earned INR 7 Lakhs and my employer deducted TDS, so I didn't file ITR. I have now got an income tax notice for not filing ITR. I am worried and don't know what to do?
First of all, Don't panic. Many people do not file ITR because they are under the belief that since TDS has been deducted, they don't need to file ITR. It is mandatory to file ITR, if total income exceeds INR 2.5 Lakhs before considering Chapter V1-A deductions.You have most probably got this notice because you have filed ITR in the past, but have not filed your ITR for a particular year. So check [...] View More
I am 23 years and residing in Mysuru. I was a brilliant student and secured a seat in electrical engg in a reputed college in Bengaluru 4 years ago. The course fees was INR 4 Lakhs and I took an education loan of INR 5 Lakhs from a reputed bank as my parents could not afford the fees. I passed in first class but even after 4 months I have not found a job. I don't have the money to repay this loan. I don't know when I will get a job and my friends have advised me to default on this loan. What have I to lose anyways?
Yes, your education loan is unsecured and you may be tempted to default as your friends suggest. These points will tell you what happens if you default on the loan. 1. Bank could send recovery executives to your residence who could talk to your neighbors. Your reputation would be lost. 2. Not only your cibil score but also your father's cibil score is affected as he stood guarantor to the loa [...] View More
I am 41 years married and reside in Dharwad. I took a home loan in 2011 to buy a house. I have repaid this home loan. Now, I want to take another home loan to buy a house. Will I still get tax exemptions as this is my second house?
You can avail tax benefits in respect of the interest paid on the home loan availed for the second residential property and the quantum of interest that qualifies for the tax deduction would vary depending on whether the second residential property is let out or self-occupied. You can claim a tax deduction towards repayment of principal in respect of the housing loan borrowed from specified len [...] View More
I am 27 years married and reside in Sirsi. I work in a reputed firm and want to avail an education loan to fund my sister's higher education (MBA). Will I get tax benefits on this education loan?
You can claim a deduction under Section 80E of the income-tax Act in respect of interest paid on an education loan, subject to other specified conditions, but only where the loan is taken by you to fund your higher education or the higher education of your wife/children or a student for whom you are a legal guardian. There are certain conditions which must be followed to get the tax deductions: [...] View More
I am 62 years married and reside in Karwar. I have a family floater health insurance plan which I had purchased from a reputed insurer more than 20 years ago which covers me and spouse. A friend has advised me that as I am a senior citizen, I must now avail a senior citizen health insurance plan. Should I pick up a senior citizen health insurance plan for me and spouse. Please advise?
If you have already bought a health insurance plan anytime before the age 60 or 65, it is better to continue with it. Individual or family floater health plan allows you to buy them till age 65, and have lifetime renewability. As per the IRDAI guidelines, you may continue renewing the family floater health insurance plan for a lifetime. Senior citizen health insurance plan, in that case, is not r [...] View More
I am 45 years married and residing in Arisikere. I have invested INR 3 Lakh in equity mutual funds, INR 4 Lakhs in debt mutual funds and INR 1 Lakh in liquid funds. I have a query. I want to redeem all these mutual funds. A friend has told me that since I am redeeming more than INR 2 Lakhs the normal T+3 Duration for equity mutual funds and the T+1 Duration for debt mutual funds does not hold. Is this true?
When it comes to redemption, the amount of redemptions does not matter. So even if you redeem more than INR 2 Lakhs, it shouldn't be a problem. As you pointed out, for domestic equity funds (that is, funds that invest in the Indian stock market), the redemption pay-out timeline is typically three business days (T+3). So, if you make a redemption on Monday, the money would be in your account by Th [...] View More
I am 32 years married and residing in Kodagu. I recently applied for a term life insurance plan with a critical illness rider. The insurer made me fill up the proposal form and then undergo a medical check-up. The medical reports came as normal. However, the insurer suggested a 100% loading on premium and then refused me critical illness cover. The insurer said I was overweight. I weigh 130 Kgs and am 6'3”in height. Can they do this?
The insurer is allowed to accept or reject a proposal at the underwriting stage. A counter-offer can be made to you (customer) by the insurer. It is up to your discretion to accept or reject the counter-offer. You can also apply for reconsideration. Your reconsideration request could be supported by either similar cases issued at lower rates or with a rationale to be considered as a standard case. [...] View More
I am 39 years married with a son and residing in Kumta. I wanted to buy a term life insurance plan with a sum assured of INR 2 Crore and paid the premium of INR 16,000. After the medical tests the insurer increased the premium by INR 7,000. They said I consume tobacco which I have never done in my life. I’ve asked for a copy of the detailed medical report and am waiting for the same. What should I do. Please advise?
It's very good that you asked for the medical report based on which the loading has been advised. Insurers are allowed to accept or reject a proposal during the underwriting stage. In select situations, they can issue a counter-offer to the customer. It is up to your discretion to accept or reject the counter-offer. Insurer cannot force the counter-offer on you. In your case, you can reject their [...] View More
I am 45 years married with a daughter and reside in Bijapur. I have read reports that health insurance policies only cover hospitalization-related illnesses. Does this mean treatments such as dialysis and cataract surgery are not covered? Please advise.
Most health insurance policies require minimum 24 hours of hospitalization for a claim to be admissible. The exception is day-care surgeries. Surgeries that can be done without hospitalization or less than 24 hours of hospitalization, due to advancement of technology, are classified as day-care surgeries.Dialysis and cataract are common types of day-care surgeries. However, these will be covered a [...] View More
I am 28 years single and residing in Badravati. I had invested INR 2 Lakhs in liquid funds. My friend has told me to shift this money into equity diversified mutual funds where I will get better returns. But if I move from liquid funds to equity funds, it will attract short-term capital gain tax. How does it benefit me after paying this tax?
You have money in liquid funds and you can transfer it to equity diversified mutual funds using the Systematic transfer plan (STP). STP is essentially transferring investment from one asset or asset type into another asset or asset type. The transfer happens gradually over a period. If you sell your liquid funds before three years (36 months), you will have to pay short-term capital gains tax. S [...] View More
I am 27 years single and residing in Bengaluru. I plan to be a freelancer offering services in graphic designing. I am not sure of the tax rules for a freelancer and if can avail tax benefits under Section 80C like salaried employees. Please could you tell me if freelancers are eligible for tax benefits?
Being a freelancer gives you dual tax benefits.As individuals, you can claim the Section 80 tax-saving deductions that are available to your salaried counterparts, and as freelancers, you can also claim the deductions available to business owners. You are eligible for deductions on taxsaving investments like ELSS, NPS and PPF under Section 80C, deduction on house rent under 80GG and so on. You ca [...] View More
I am 32 years married and reside in Bidar. I have heard that payment banks will be the next big thing. Can I invest my money in these payment banks and will it be safe? Do these banks give credit cards? Kindly advise?
Payment banks can accept deposits restricted to Rs 1 lakh per customer, and are allowed to pay customers interest on the money that is being deposited in savings accounts. You will be able to operate your account using the mobile app offered by payment banks.It allows transfers and remittances through the mobile, offers services such as automatic payments of bills, cashless purchases, chequeless t [...] View More
I am 35 years married with a son and residing in Udupi in a rented place. I want to reside in my own home and am looking for a home loan. A friend has told me that CIBIL score inquiry from multiple banks will reduce my credit score? Is this true?
All enquiries for CIBIL Score through any Bank will finally go to, and will be answered by the Credit Information Bureau (India) Limited or CIBIL, which is a Credit Information Company (CIC). Credit Information Report (CIR) and CIBIL TransUnion Score are very important in the loan approval process, to identify consumers who are likely to be able to pay back their loans. Inquiry about CIBIL [...] View More
I am 28 years unmarried and residing in Tumakuru. I stay in a rented apartment and want to claim tax relief on HRA receipts. Many of my friends present fake rent receipts to make the claim. I am tempted to do the same but after demonetization, income tax department is very strict. Is there any other way to claim tax relief? Please advise.
You already know submitting rent receipts to your company’s human resource department can help you save taxes. But, what you may not know is that submitting a fake rent receipt can put you in trouble with income tax department. A recent judicial pronouncement has given powers to your assessing officer to check all your documents to see whether the House Rent Allowance (HRA) claimed by you is g [...] View More
I am 35 year old housewife residing in Honavar with my daughter. I have been watching Mutual Funds Sahi Hai ads on television and want to invest in mutual funds. I have a doubt. Should I invest in mutual funds via SIP or lumpsum. I prefer lumpsum. Please advise.
If you switch on your TV, you will see the highly popular Ad, Mutual Funds Sahi Hai. This is a campaign launched by AMFI (Association of Mutual Funds in India), whose aim is to create awareness on mutual funds. As a rule, you should invest in debt schemes to achieve your short-term financial goals which are less than three years. You may invest in equity schemes to achieve your long-term goals [...] View More
I am 47 years married and residing in Holenarasipura. I want to avail a health insurance plan which covers Ayurvedic treatments. Will I be able to get it? My son is studying Ayurveda. Will he be able to cater to those patients who want the treatment to be paid by their insurance? Please advise Is Ayurveda Treatment Covered in Health Insurance Policies?
Yes, several health insurance plans cover Ayurveda treatments. The coverage of ayurvedic treatments is dependent on the particular insurer. A few policies would cover such treatments up to the full sum assured, while several policies would limit the expenditure and cap the overall sum assured. There may be a cap on the amount covered which usually ranges from 7.5% to 25% of Sum Assured. Some healt [...] View More
I am 36 years married with a daughter and residing in Davangere. I have a 3 year old daughter. I want to take a ULIP child plan to finance her higher education. My friend has suggested a Sukanya Samridhi Scheme as a better saving scheme instead of Unit Linked Insurance Plan (ULIP) child plan. Is this true? Please advise
Sukanya Samriddhi Yojana (SSY) is a small deposit scheme for the girl child currently fetching an interest rate of 8.3% for FY 2018-19 and provides Section 80C income tax benefit up to INR 1.5 Lakhs a year. A Sukanya Samriddhi Account can be opened any time after the birth of a girl child till she turns 10, with a minimum deposit of INR 1,000. To meet the requirement of your daughter's higher educ [...] View More
I am 39 years married and residing in Kumta. My mother died a year back. Recently I came across a term life insurance plan which my now (deceased) father had bought in my mother's name. Can I approach the insurer for more details? What information would I need to be able to find out who the nominee was and the benefits due?
If you have the policy number, use that along with know your customer (KYC) details of your mother to seek the policy details from the insurance companies. Insurers should be able to provide you this information through their customer service helpline. You may have to visit the issuing branch to get these details.
If you have make a death claim, you would need the original policy document [...] View More
I am 41 years married with a son and residing in Karwar. I work for the State Government and am covered for all medical issues. A friend has told me I should avail a health insurance plan which will cover my medical expense for my family after my retirement. Is this a good idea? Kindly tell me.
It is always a good idea to have your own health insurance cover over and above the one provided by your employer as an individual health insurance policy will remain with you, regardless of your retirement. You must take adequate health cover, well before you retire. With age, the health risk increases and also to be applicable for the pre-existing disease coverage, you would need to spend at le [...] View More
I am 35 years married with a daughter and residing in Mysuru. I have shares of some blue-chip companies in my demat which I want to transfer from my current stock broker to another. Is this transfer possible? Are there any costs involved in the transfer?
Before transferring shares between demat accounts, you have to first understand how your shares are maintained in depository systems. In India two organizations are authorized to hold your shares called depositories. 1. NSDL (National Securities Depository Limited) 2. CDSL (Central Depository Services Limited) Your broker will be attached to either one of them. You want to transfer share [...] View More
I am 37 years married with a son and residing in Mandya. I plan to avail a home loan of INR 40 Lakhs to buy my home. I want to know if there are any tricks which will help me repay my home loan faster? Can you also tell me what is home loan switching?
You must avail a home loan with a shorter tenure which helps you complete the loan repayment quickly. This means you pay lesser interest. If you opt for a shorter home loan tenure, your EMI's are higher, but the principal amount gets repaid earlier. Since the rate of interest is calculated on the principal, once the bank recovers the principal amount, the absolute interest pays out decreases margi [...] View More
I am 31 years unmarried, residing in Shirva and working for a Company there. Excess TDS has been deducted from my salary. I want to claim an income tax refund. Can you please tell me how to claim an income tax refund?
You are eligible to receive income tax refund when you have paid more tax to the government than your actual tax liability. You can claim the refund of the excess tax paid/deducted during a financial year while filing your income tax returns for that year. · As per the Income Tax Act, youare required to file returns in the relevant assessment year by July 31 to claim the refund. [...] View More
I am 39 years married and residing in Kumta. My mother died a year back. Recently I came across a term life insurance plan which my now (deceased) father had bought in my mother's name. Can I approach the insurer for more details? What information would I need to be able to find out who the nominee was and the benefits due?
If you have the policy number, use that along with know-your-customer (KYC) details of your mother to seek the policy details from the insurance company. Insurers should be able to provide you with this information through their customer service helpline. You may have to visit the issuing branch to get these details.
If you have to make a death claim, you would need the original policy [...] View More
I am 41 years married with a son and residing in Karwar. I work for the State Government and am covered for all medical issues. A friend has told me I should avail a health insurance plan which will cover my medical expense for my family after my retirement.Is this a good idea? Kindly tell me.
It is always a good idea to have your own health insurance cover over and above the one provided by your employer as an individual health insurance policy will remain with you, regardless of your retirement. You must take adequate health cover, well before you retire. With age, the health risk increases and also to be applicable for the pre-existing disease coverage, you would need to spend at lea [...] View More
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