Fire your tax related quieries and i would get it solved!!!

striker_rage,
About your RPL:
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No matter however sure you are about a future prospect of a company, be warned that the term "future" has certain amount of uncertainty with it. Never invest in one single stock. There are several things that can go wrong. ( Ambani can die of heart attack, Govt may bring in a regulation that affects petrolium companies, a new discovery can make petrol useless, a terrorist attack, accident in one of their sites ........ just to name a few.) So never invest in a single stock. You need atleast 5 stocks. There are several such high risk high return investments even today. IDBI, Lanco Infra, RPL, punj lloyd , teledata info...

Still one should not invest all savings in one asset class (equities..) let alone a particular stock.


About your black money problem:
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long term assets are best way to launder your black money into white money while paying minimum Tax. Otherwise you risk loosing all black money by way of IT raid, your benomies (how do we spell that?) can cheat you, money sitting idle does not earn for you..

First of all we need to bring your black money into account (make it white). One way is as diosys suggested find one or more persons who have huge white money (a retired Govt employee who disbursed his money to his children for example..). Either you make him gift (on paper only) your own money to maxium capacity possible. Then you will have to pay around 30% as tax. Now the gifted money has become white!.

Another scenario is that you can make him lend you money and work around. I dont want to go into details of that. Here if you do it carefully, you can evade tax, which is more illegal than the former method.

For tax evasion, you might consider purchasing land, especially where market value is very much higher than Govt's estimated value. For example, if a land is 200 rs per sq. ft in market and Govt estimate is only 20 rs, you can buy 10,000 sq fit for 20,00,000. but white money is only 2,00,000. So tax on this case will only be less than 60,000 rs, but you can buy a 20 lac asset. When you sell it back after 3 years, it becomes a long term capital gain, taxed at 10% only. So in effect you will pay 60,000 now and about 1.8 lac after three years.

But if you invest 20 lac in stock you will have to pay about 6lac in taxes. But stock is something more liquid in the sense that you can convert it into money within 3-5 days.

Since your dad and mom are the taxpayers, diosys will require you to mention their income in
previous years, so that he can give you better suggestion.

You get a PAN card. create a demat account for yourself.

You can invest a maxium of 1 lac, but I would advise only 75K. Your mother can invest a maximum of 145K, if she has not shown any profit in previous years. If she has shown profit in previous years she can invest more accordingly.

About how much you can invest in your dad's account will be clear if we know his income details. He can invest close to 75K if he has profit in previous years, he can invest more.

Sorry for the previous quick, incorrect reply. Edited now.

Dear Diosys,

An excellent and educative thread, you've started, for the benefit of this entire forum. Congrates for the same.
I took voluntirary retirement at the age of 57 and am living on my pension only. Can I be classified as Senior Citizen, as I'm a pensioner now, or only after attaining the age of 60 ?
As long as I was in service, my tax was deducted at the source and my returns were filed regularly. Now, after my VRS, as the pension amount is less than Rs.1,00,000/- a year, have I to file returns ?

Thanks in advance.

Dear Striker...

As i had requested to you earlier that without a proper disclosure of the Income earned by you and your members i can comment upon the solution....Nevertheless less presuming some things i would try to answer you...

First thing first....If you use your Dad's account for trading then it is all his unless he gifts you later....

Secondly it would be correct if you show some tuition income...Even to the tune of 1.10 Lacs so that it is clear from your side the amount you invest in securities....

For commenting upon your mom's best possible way is to increase her income 1.35 Lacs and similarly for your father....

Apart from these measures you should be safe enough to deposit 4000 in twelve separate transactions through different people....

Dear Sir....

Thank You for your compliments...

Sir, in order to be classified as a senior citizen in Income Tax Act one has to cross the age of 65.....Pension or no pension is not the criteria to be called a senior citizen....Once you cross or attain the age of 65 the senior citizen clause would apply...Hence even if you become senior citizen (65) even on 31st March, 20XX then also the clause would apply to the Whole of the previous financial year....

For non senior citizen age the limit for payment of tax is 1,00,000 therefore since you being below the same you are not required to file you Income Tax Return...even if you have a PAN it is not required...

Thanks. Is it possible to offset short-term capital gains arising out of sale of shares against long-term capital losses in the same year? Or else, how to minimise the taxes arising out of sale of shares in the short term? Even auditors don't give a proper reply to this.

Excellent thread,Diosys!

Thanks Buddy !!!

Everyone comment tells me that this thread is actually helping someone there !!!

Dear Ferret...

It is not possible to off set STCG against loss in Long term gains...The government has been very wise here....They do not allow 10% taxable income to be set off a non taxable loss but they allow Long term gain against short term loss.....

For my concrete reply to your suggestion i would require your income breakup...Whether you are salaried??? Business??? How much sort term gain??? How much long term loss ??? like what and how much is your income from different sources...

By looking into your various aspects of Income I may be able to suggest you to book your transactions as Business Income rather than Capital gain in order to set off your short term gain against LTCG, plus you get to value your securities at lower of cost or market !!!

But all this would depend upon the specifications that i need as mentioned above...

I am new to this forum please any body help. What is the Tax slab (Capital gains and Income Tax with example)