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Know Your IT Assessing Officer

| 5/16/2013 9:00 PM Thursday

KEY POINTS

  • Assessees need to fill Form 15H/15G for non-deduction of tax at source. Some additional details are required in order that the Assessing Officer (AO) is informed of the non-deduction. These details are available on the Income Tax department web page.
  • Buying and selling of property is realty business and non-residents are prohibited from practicing it in India. But buying a property, developing and then selling it would not be construed as realty business.
  • Under Section 10(38) of the Income Tax Act, 1961, any income arising from the transfer of a long-term capital asset which is an equity share in a company or a unit of an equity-oriented fund is exempt from taxation, provided that STT has been paid in respect of the sale transaction. Under Section 111A, any income arising from the transfer of a short-term capital asset which is an equity share in a company or a unit of an equity-oriented fund is chargeable at 15 per cent, provided that STT has been paid.

Q) I am a senior citizen and have some amount of money in fixed deposits. My bank recently gave me a new Form 15H (for non-deduction of tax at source) from my interest income for AY2012-13. As a part of this, I have to provide the bank details such as area code, AO type, range code and AO number, among others. How do I get these details which are available with the Income Tax department?

- Raghuram K

The Department of Income Tax has introduced a new Form 15H/15G for non-deduction of tax at source by the payer. The additional details are required in order that your Assessing Officer (AO) is informed of your non-deduction. You can find these details on the Income Tax department web page: http://incometaxindia.gov.in/home.asp

On the e-filing home page, you can get the details of the jurisdiction of your AO by clicking on ‘Know Jurisdiction AO’. You will be required to enter your Permanent Account Number (PAN) and the image code as directed and then click the Submit button. This will provide you with the details you need.

Q) I am an NRI businessman residing in Dubai. Can I start a new business of buying and selling property in India?

- Dharmesh Shethia

Buying and selling of property is realty business and non-residents are prohibited from practicing it in India. But if you buy a property, develop it and then sell, the same would not be construed as realty business. You will, however, have to comply with the provisions of the Foreign Exchange Management Act (FEMA), 1996 and the Reserve Bank of India directives when you start a business in India.

Q) I am dealing in mutual fund holdings. Are they exempt from taxation? If not, what are the tax implications?

- Uttara Mayekar

Under Section 10(38) of the Income Tax Act, 1961, any income arising from the transfer of a long-term capital asset which is an equity share in a company or a unit of an equity-oriented fund is exempt from taxation, provided that Securities Transaction Tax (STT) has been paid in respect of the sale transaction.

An equity-oriented fund is one:

(i) Where the investible funds are invested by way of equity shares in domestic companies to the extent of more than 65 per cent of the total proceeds of such fund;

(ii) Which has been set up under a scheme of mutual fund specified under clause 10(23D) of the said Act

Further, under Section 111A of the said Act, any income arising from the transfer of a short-term capital asset which is an equity share in a company or a unit of an equity-oriented fund is chargeable at 15 per cent, provided that STT has been paid in respect of the sale transaction.

However, the income in long-term capital gains from mutual fund holdings other than equity-oriented funds will be charged at 20 per cent after indexation. Any income in short-term capital gains from mutual fund holdings other than equity-oriented funds will be charged at normal rates.

 

Find More Articles on: DSIJ Magazine, Tax Queries, Personal Finance, Tax

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