Budget 2018 & Your Investments

1.2.2018

"In 1790, the nation which had fought a revolution against taxation without representation discovered that some of its citizens weren’t much happier about taxation with representation."–Lyndon B. Johnson

We at InvestmentMitra do not see budget proposals in the light of good or bad, rather we try to explore the proposed provisions and align our investor’s portfolio of investments accordingly. Salient features of these budgets that impact personal investments are as under:

Ø Long term capital gains tax on equity shares and equity oriented mutual funds exempt only upto one lakh and any excess gains over one lakh will be taxed @10%.

Ø Dividend distributed by equity oriented mutual fund schemes including balanced funds will be subject to tax@10%.

Ø Upto 40% withdrawal from NPS will be exempt from tax for all subscribers.

Ø For senior citizens premium paid for health insurance will be tax deductible upto Rs. 50,000/-.

Ø For senior citizens investment limit under Pradhan Mantri Vaya Vandana Yojna paying interest @8%p.a. increased upto 15 lakhs.

Ø For senior citizens exemption of interest income on deposits with banks and post offices to be increased from `10,000/- to `50,000/- and TDS shall not be required to be deducted on such income, under section 194A. This benefit shall be available also for interest from all fixed deposits schemes and recurring deposit schemes.

Ø Interest earned on 7.75% GOI bonds in excess Rs.10,000/- will be subject to TDS.

Ø Period of holding for capital gains bonds u/s 54 increased from 3 to 5 years.

Ø Tax treatment for equity oriented fund of funds investing in ETF that invest in shares of domestic companies will be at par with regular equity funds.

Ø For real estate sale transactions, no adjustment shall be made in a case where the circle rate value does not exceed 5% of the consideration.

It becomes imperative to realign your investments in the light of the new proposals to enjoy better tax adjusted returns. Contact your advisor or you may write to us by texting or whatsapp on this number or email to info@investmentmitra.com and/or arisbaconsultants@gmail.com

Happy investing!

Comments

This Republic Day Write Your Own Financial Constitution

“Constitution is not mere a lawyer’s document, it is a vehicle of life and its spirit is always the spirit of Age” – BR Ambedkar A constitution primarily is a document that details the rights, obligations, privileges, duties and responsibilities of the people living within the corridors of, and leading that country. It details the rule of governance. Without a constitution it will be difficult to live like a civilised society. We would be living like in stone-age where “Might was Right” and jungle raj prevailed all over. Like a country, each individual should also have his or his family’s own financial constitution detailing various financial objectives and the process to achieve those financial objectives, rules that will govern the way its finances will be managed etc. This applies to all individuals without exception and is more popularly known as “Financial Plan”. Like a constitution your financial plan should have a Preamble and different schedules. Preamble -

Time or Timing – What is more important with Sensex @ 64K

The Stock Market is the device to transfer wealth from the IMPATIENT to the PATIENT. After swinging in a range for almost one and half years, markets breached their previous peaks and are scaling new one now. Markets have risen by almost over 14% in last three months. Major reason for this sudden rise is the return of FIIs to the Indian stock markets following the fact that India is the fastest growing economy and growing over 6% despite covid, global economic slowdown and geo-political tensions. We invest for long term and everyone knows in the long run markets will go up irrespective of intermittent shocks like scams, dot-com bubble, Lehman crisis, covid or banking troubles in USA etc. Following picture depict the journey of Sensex over 40 years since its inception. Source; www.thenwsmen.co.in The unfortunate part is we are more concerned about the short term movements of the markets. Every time there is sudden rise or fall in them market we are gripped more by fear and l

On Cross Roads

“We cannot truly plan, because we do not understand the future- but this is not necessarily a bad news. We could plan while bearing in mind such limitations. It just take guts.”- Taleb: Propounder of The Black Swan theory. Pessimism that set in March, still persists in our minds. In fact it has deepened with growing number of Covid cases being reported. The largest question ruling our minds today is - Shall we ever be able to overcome it………….. and if yes by when and how? Have we ever wondered how have the Indian culture survived for so many thousands of years, how come so many Indians who were transported as labourers to many African and European countries centuries ago are now ruling the roost or how come most of the top 20 firms in the world have Indian heading them and so on……….. The only reason to above and many such questions is our “ Ability to Adapt ”. We are fast learner and very quickly adapt to new situation. Indians enjoys six different weather in a yea

Markets Tumbling, Recovering – What to do??

Markets Tumbling, Recovering – What to do?? "The best time to plant a tree was 20 years ago. The second best time is now." - Chinese proverb. In times like present most people flock towards safety. Most do it because they don’t know how long this doomsday atmosphere will last, some even feeling like there will be No Tomorrow. But hunger for good returns on our investment never ceases. Kin Hubbard satires, "The safest way to double your money is to fold it over and put it in your pocket." On investment and earning good money from them, Warren Buffet – the legendary investor says, "If I buy a farm, I don't know whether there's going to be drought next year, but I know that there are not going to be 20 straight years of drought, and I know there's not going to be 20 straight years of great rainfall." It is a proven fact that no matter what, in long term best returns come from stock markets only. And as Seth Klarman says, “The stock mar

Have You Missed Boarding the Bus

"The market does not trade upon what everybody knows, but upon what those with the best information can foresee" – William Hamilton Russia-Ukraine conflict had clouded the stock markets worldwide giving speculations to the talks like possibilities of third world war, Russia heading for deep financial crisis, energy crisis looming large over Europe etc. With Russia-Ukraine conflict seems getting settled and much to the pleasure of Russia – the Super Power, this has now become a non-player for the markets until some significant deviation happens from the present stance taken by all major countries of the world. Present is the world of instant. We want everything instant and so are our reactions. In the age of internetted social life, dissemination of information is highly fluid. And over 99% of these netizens have mastered the art of forwarding such information without verifying if it’s a news, noise or manipulated agenda of some interested parties. Most economies in

Search This Blog