Legal & income Tax


The difference between the STATE BANK OF INDIA rate and the contracted rate is to be treated as a perquisite. The SBI rate for housing loan ranges from7.5% to 8.25% depending on the period of the loan for asst year 2005=2006.
  1. First and foremost transfer of the land to a trust will entail stamp duty at 13%. Later the trust selling the land will have to pay long term capital gains tax of 20% subject to indexation of the cost of the asset.
  2. 2. This option looks better since you sell the asset in question retain the post tax proceeds in you name and use the funds to start the corpus for the trust. The constitution of the trust can be adequately structured to mitigate tax consequences.

  1. Since you are an NRI there is no need to file any return of income even under the one by six scheme. You need not include this in the US tax return.
  2. If the property is let out and derives income a return of income has to be filed reflecting the income and claiming the deductions relating to property tax and interest on loans.
  3. Proceeds on the maturity of LIC policy are exempt from tax. Interest on NRO account is taxable and a return has to be filed to get the TDS refunded if the income is below the taxable limit.
  4. Specific US tax issues are not addressed in these columns.
Salary earned in Singapore for 2004-05 is taxable in Singapore and the remittance of 75000/- is not taxable in India. Likewise salary earned for 2005-06 is taxable in Singapore and not in India.
In earning 3 streams of income i.e. rental, business and capital income, what is the position to taxation in India for a NRI as there is a Double Taxation Pact with Australia. Secondly, is there any way the income can be remitted overseas? Is there any time period after which these incomes are permitted to be remitted or at any time after investment?
In respect of the streams of income a non-resident can opt for a flat 20% tax subject to certain conditions. The said income can be remitted overseas subject to RBI regulations.
For the year 2004=2005 you will be treated as a resident in India and the salary earned in Australia is taxable in India. The tax return can be submitted from Australia itself and has to be filed before the 31st July. The tax paid is Australia can be set off in India in accordance with the DTA Agreement. There is no limit for the transfer of funds from the NRE Account to any other account. Gifts out of this account could be treated as income in the hands of the recipient. There are exemptions for specified relatives. Interest earned on NRE account continues to be exempt from income tax. There is not general utility tax here.
The rate of tax on interest on NRO account is 10% plus surcharge.
PAN no is mandatory if you have income in excess of the limit liable to tax. In your cases your investments are in India and in Indian currency. You will have to apply for PAN no in any NRI circle in the metro cities.
If the shares are listed and sold after holding them for more than 12 months the long-term capital gains are exempt. Otherwise they are liable to tax. Repatriation of the sale of shares is not permitted.
Yes. You can either pay under normal slab rate or 20% flat rate with surcharge and cess.