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Showing posts with label Senior Citizen Saving Account Scheme. Show all posts
Showing posts with label Senior Citizen Saving Account Scheme. Show all posts

Only Sukanaya Scheme and 5 Year Senior Citizen Saving Scheme Interest rate increased by 0.1% w.e.f. 1st April, 2015.

Recently Government announces Interest Rate for various Small Saving Schemes, the Revised Rate of Interest applicable on Specified Small Savings Scheme with effect from 1st April, 2015.

It was decided by the Government of India that interest rates on Small savings Schemes will be linked to yields on government securities of comparable maturity. In pursuance of that decision, the Government has decided to revise the rates applicable on various small savings schemes as given in the table below. 


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CBDT directs to maintain appointment schedule with taxpayers in case of Citizen's

CBDT has issued Office Memorandum u/s. 119 of Income Tax Act, 1961 regardinging Instructions to maintain the schedule of appoints with taxpayers in spirit of Citizen's Charter dated 22nd August, 2014 which is as under:

F.No.Dir(Hqrs.)/Ch.(DT)/29/2013
Government of India
Ministry of Finance
Department of Revenue
(Central Board of Direct Taxes)
Room No.155, North Block, New Delhi,
Dated the 22nd August, 2014.

OFFICE MEMORANDUM

Subject: Instructions to maintain the schedule of appointments with tax payers etc.-reg.

It has been brought to the notice of the Board that some of the officers are issuing notices to the taxpayers/witnesses/representatives etc. indicating a standard time of appointment. Thus, many persons called for hearing etc. on a day by an officer are given the same time for appearance. Naturally the persons are made to wait for their turn. Such actions, apart from causing avoidable inconvenience to the taxpayers/witnesses/representatives etc. cause great embarrassment to the Government.

All the officers, are therefore, advised to strictly maintain the appointment schedule in spirit with the Citizen's Charter, 2014 of the Department which specifically provides that we (in the Department) endeavour "to adhere to the schedule of appointments with taxpayers". All the Supervisory officers, i.e. the CCsIT, CsIT and the Addl. CsIT are requested to ensure that officers reporting to them strictly comply with this instruction and avoid fixing multiple appointments at the same time. Instances of disregard to these instructions may be viewed seriously.

This issues with the approval of Chairman, CBDT.

sd/-
(Anil Uniyal)
Dir.(Hqrs.),CBDT

To
All Pr. CCsIT/Pr. DGsIT/ CCsIT/DGsIT for ensuring compliance in their respective jurisdiction.

Copy to: PSs to Chairman/Members /CBDT.

Spouse or nominee can operate the Account of Deceased Sr. Citizen Assessee.

SENIOR CITIZEN SAVINGS SCHEME (AMENDMENT) RULES, 2014 - AMENDMENT IN RULE 8

NOTIFICATION NO. GSR 392(E) [F.NO.4/2/2012/NS-II], DATED 9-6-2014

In exercise of the powers conferred by section 15 of the Government Savings Bank Act, 1873 (5 of 1873), the Central Government hereby makes the following rules further to amend the Senior Citizens Savings Scheme Rules, 2004, namely:—

1. (1) These rules may be celled the Senior Citizen Savings Scheme (Amendment) Rules, 2014.
    (2) They shall come into force on the date of their publication in the Official Gazette.

2. In Senior Citizen Savings Scheme Rules, 2004, after sub-rule (3) of rule 8, following shall be inserted, namely:—

"Provided that in the case of a joint account, or where the spouse is the sole nominee, the spouse may continue the account on the same terms and conditions as specified under these rules:

Provided further that in case the spouse does not continue the joint account, the account shall be closed on an application in Form-F and the deposit refunded alongwith interest as above".

Who enjoys exemption on pension amount.

There are however, different rules for different categories of people receiving different amounts of pension. Some of these are exempted from Income Tax, but most of them do not enjoy any exemptions. The provisions of the TDS as stated in Section 192 are application to the pension as it is viewed as an income.

Pension is nothing but a regular stipend given to an ex-employee in recognition of the service he has put in. The pension amount is fixed in advance by the employee and the employer. The pension amount received by a retired employee in India is treated as an income and so the norms of taxation are applied. There are however, different rules for different categories of people receiving different amounts of pension. Some of these are exempted from Income Tax, but most of them do not enjoy any exemptions. The provisions of the TDS as stated in Section 192 are application to the pension as it is viewed as an income.

Categories of pensioners: 

While the majority of the population falls under the general category and their pension is taxed, there are some categories that enjoy tax exemption on the pension amount they receive.

These people include:

1. An employee of the UN – A person who has worked for the UN is eligible for tax exemption. In the case of death of the employee, the family members will be entitled to receive the tax-free pension amount.

2. Armed forces – Under section 10(19), the pension received by an armed forces employee or the family will be tax-free.

3. High Court and Supreme Court judges – Retired High Court and Supreme Court judges receive a tax exempted commuted pension amount as long as the value is less than half of their total pension under Section 10(10A)(ii).

4. General public – Government and non-government employees, who do not fall in the above mentioned categories, do not enjoy any tax deductions in the pension they receive. Their pension is seen as an extension of their income and the taxes apply. This continues till the person lives and receives pension. In the case of his/her death, the nominee continues to receive the pension amount after the taxes are deducted.

Tax benefit in premiums paid for pension plans

If you buy an insurance policy to provide for your retirement days (also known as pension plans), you will get a tax discount on the premiums you pay. You can avail tax benefits of up to Rs 10,000 under Section 80CCC.

Tax benefit on maturity amount received Under Section 10 (10A), 1/3rd of the maturity benefit received from a pension plan is tax-free. The pension amount that is received thereafter, however, is taxable.

So as we can see, the pension received in the hands of the annuitant is not tax-free, unless the person falls in a special category. Whether you get your retirement benefit from your employer in the form of pension or from your insurance policy, the monthly amount you receive will be taxed. So keep this in mind while calculating your expenses. However, as there is a substantial tax benefit on the premium you pay for your retirement plan, it makes it a very good savings option. Not only do you end up saving tax, you also build up a corpus for your retirement years.

Sournce : www.moneycontrol.com

PPF & Sr. Citizens Saving Scheme Interest Rates w.e.f. 01.04.2014 and Other more.

Recently RBI has published a notification No. RBI/2013-14/526 dated March 21, 2014 for Interest rates on most popular and atractive Income Tax Saving Schemes i.e. Public Provident Fund Scheme, 1968 (PPF Scheme, 1968) and Senior Citizens Savings Scheme, 2004 (SCSS, 2004).  In small Tax Saving Schemes, small Investors earn interest on PPF savings and take Tax Benefit from Income Tax as same SCSS shemes also very useful for Sr. Citizens Taxpayee, even if their Taxable Income is less than Tax exemption limit of 10% slab.

Public Provident Fund Scheme, 1968 (PPF Scheme, 1968) and

Senior Citizens Savings Scheme, 2004 (SCSS, 2004) - Revision of interest rates


Please refer to our circular RBI/2011-12/359 dated January 20, 2012 regarding interest rates on small savings schemes, wherein it was indicated that as per Government’s decision on revision of interest on small savings schemes, the interest rates on various small savings schemes for every financial year will be notified by the Government before April 1st of that year.

The Government of India has now vide their Office Memorandum (OM) No. 6-1/2011-NS.II dated 4th March 2014, advised the rate of interest on various small savings schemes for the financial year 2014-15. Accordingly, the rates of interest on PPF, 1968 and SCSS, 2004 for the financial year 2014-15, effective from April 01, 2014, on the basis of the interest compounding/payment built-in in the schemes, will be as under:

Scheme
Rate of Interest w.e.f.
01.04.2013
Rate of Interest w.e.f. 01.04.2014
5 Year SCSS, 2004
9.2% p.a.
9.2% p.a.
PPF, 1968
8.7% p.a.
8.7% p.a.

The Rates of Interest on various small savings schemes for the Financial Year 2014-15 effective from 01.04.2014, on the basis of the interest compounding/payment built-in in the schemes, shall be as under :


Deductions u/s. 80CCG (New Equity Saving Scheme) for Asstt. Year 2014-15.

Newly inserted Section 80CCG provides deduction wef assessment year 2013-14 in respect of investment made under notified equity saving scheme. Rajiv Gandhi Equity Savings Scheme 2012 has been notified vide SO No 2777 dated 23.11.2012 as a scheme under this section. The deduction under this section is available if following conditions are satisfied:
  • The assessee is a resident individual
  • His gross total income does not exceed Rs. 12 lakhs;
  • He has acquired listed shares in accordance with a notified scheme or listed units of an equity oriented fund as defined in section 10(38);
  • The assessee is a new retail investor;
  • The investment is locked-in for a period of 3 years from the date of acquisition in accordance with the above scheme;
  • The assessee satisfies any other condition as may be prescribed.
Amount of deduction –The amount of deduction is at 50% of amount invested in equity shares/units. However, the amount of deduction under this provision cannot exceed Rs. 25,000.

Withdrawal of deduction – If the assessee, after claiming the aforesaid deduction, fails to satisfy the above conditions, the deduction originally allowed shall be deemed to be the income of the assessee of the year in which default is committed.

This deduction is now allowed for three consecutive assessment years beginning with the AY in which the listed equity shares or units were first acquired. If any deduction is claimed by a taxpayer under this section in any year, he shall not be entitled to any deduction under this section for any other year.

e-Adhaar is sufficient Proof for New Opening Bank Account.

Reserve bank of India has issued a note regarding ID and Address proof opening new bank account with any CBS Bank.  It is saying that e-aadhar is the valid proof for opening a bank account and it fulfills both proof i.e. ID and address proof. Full note is as under.
  1. Please refer to paragraph 2.6 (B) of our Master Circular UBD.BPD. (PCB).MC.No.16 /12.05.001/2013-14 dated July 1, 2013 on Know Your Customer (KYC) Norms / Anti-Money Laundering (AML) Measures / Combating of Financing of Terrorism (CFT)/ Obligations of banks under PMLA, 2002 which states that letter issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number may be accepted as an ‘Officially Valid Document’. Further, in terms of paragraph 2.5 (ix) of the Master Circular, banks have been advised that while opening accounts based on Aadhaar, if the address provided by the account holder is the same as that on Aadhaar letter, it may be accepted as a proof of both identity and address.
  2. In order to reduce the risk of identity fraud, document forgery and have paperless KYC verification, UIDAI has launched its e-KYC service. Accordingly, it has been decided to accept e-KYC service as a valid process for KYC verification under Prevention of Money Laundering (Maintenance of Records) Rules, 2005. Further, the information containing demographic details and photographs made available from UIDAI as a result of e-KYC process (“which is in an electronic form and accessible so as to be KYC verification. The broad operational instructions to banks on Aadhaar e-KYC service are enclosed as Annex.
  3. UCBs are advised to have proper infrastructure (as specified in Annex) in place to enable biometric authentication for e-KYC.
  4. Physical Aadhaar card/letter issued by UIDAI containing details of name, address and Aadhaar number received through post would continue to be accepted as an ‘Officially Valid Document’.
  5. UCBs may revise their KYC policy in the light of the above instructions and ensure strict adherence to the same.

Centralised Processing of Statements of Tax Deducted at Source Scheme, 2013 by Income Tax Department

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY,
PART II, SECTION 3, SUB-SECTION (ii) of dated the 15th JANUARY, 2013]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
[CENTRAL BOARD OF DIRECT TAXES]
NOTIFICATION
New Delhi, the 15thJanuary, 2013
S.O. 169 (E).— In exercise of the powers conferred by sub-section (2) of section 200A of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following scheme for centralised processing of statements of tax deducted at source, namely:—
1. Short title and commencement.— (1) This scheme may be called the Centralised Processing of Statements of Tax Deducted at Source Scheme, 2013.
(2) It shall come into force on the date of its publication in the Official Gazette.
2. Definitions.— (1) In this scheme, unless the context otherwise requires,—
(a) “Act” means the Income -tax Act, 1961 (43 of 1961);
(b) “Assessing Officer” means the Assessing Officer who is ordered or directed under section 120 of the Act to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under Chapter XVII of the Act;
(c) “authorised agency” means the person authorised by the Director General to receive the statement of tax deducted at source or correction statement of tax deducted at source;
(d) “Board” means the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963);
(e) “Cell” means the Centralised Processing Cell having jurisdiction over such statements of tax deducted at source as may be specified by the Board;
(f) “Commissioner” means the Commissioner of Income-tax in charge of the Centralised Processing Cell;
(g) “correction statement of tax deducted at source” means the statement furnished for rectifying any mistake or to add, delete or update the information furnished in the statement of tax deducted at source furnished under sub-section (3) of section 200 of the Act;
(h) “deductor” means a person deducting tax in accordance with the provisions of Chapter XVII of the Act;
(i) “Director General” means the Director General of Income-tax (Systems) appointed as such under sub-section(1) of section117 of the Act;
(j) “portal” means the web portal of the authorised agency or the web
portal of the Cell, as the case may be;
(k) “statement of tax deducted at source” means statement of tax deducted at source furnished under sub-section (3) of section 200 of the Act.
(2) The words and expressions used herein but not defined and defined in the Act shall have the meaning respectively assigned to them in the Act.
3. Centralised Processing Cell.— The Board may set up as many Centralised Processing Cells as it may deem necessary and specify their respective jurisdictions.
4. Furnishing of correction statement of tax deducted at source.— (1) A deductor shall furnish the correction statement of tax deducted at source in the form specified by the Director General—
(a) at the authorised agency through electronic mode; or
(b) online through the portal.
(2) The correction statement referred to in sub-paragraph (1) shall be furnished under digital signature or verified through a process in accordance with the procedure, formats, and standards specified by the Director General.
5. Processing of statements.— (1) The Cell shall process the statement of tax deducted at source furnished by a deductor in the manner specified under sub-section (1) of section 200A of the Act after taking into account the information contained in the correction statement of tax deducted at source, if any, furnished by the deductor before the date of processing.
(2) The Commissioner may—
(a) adopt appropriate procedure for processing of the statement of tax deducted at source; or
(b) decide the order of priority for processing of the statement of tax deducted at source based on administrative requirements.

6. Rectification of mistake.— (1) An Income-tax authority of the Cell may, with a view to rectifying any mistake apparent from the record under section 154 of the Act, on its own motion or on receiving an application from the deductor, amend any order or intimation passed or sent by it under the Act.
(2) An application for rectification shall be furnished in the form and manner specified by the Director General.
(3) Where a rectification has the effect of reducing the refund or increasing the liability of the deductor, an intimation to this effect shall be sent to the deductor electronically by the Cell and the reply of the deductor shall be furnished in the form and manner specified by the Director General.
(4) Where an amendment has the effect of reducing a refund already made or increasing the liability of the deductor, the order under section 154 of the Act passed by an Income-tax authority of the Cell shall be deemed to be a notice of demand under section 156 of the Act.
7. Adjustment against outstanding tax demand.— Where a refund arises from the processing of a statement under this scheme, the provisions of section 245 of the Act shall, so far as may be, apply.
8. Appeal.— (1) Where a statement of tax deducted at source is processed at the Cell, the appeal proceedings relating to the processing of the statement shall lie with the Commissioner of Income-tax (Appeals) having jurisdiction over the Assessing Officer who has jurisdiction over the deductor and any reference to Commissioner of Income-tax (Appeals) in any communication from the Cell shall mean such jurisdictional Commissioner of Income-tax (Appeals).
(2) The Assessing Officer who has jurisdiction over the deductor shall submit the remand report and any other report to be furnished before the Commissioner of Income-tax (Appeals) and an order, if any, giving effect to appellate order shall be passed by such Assessing Officer.
9. No personal appearance at the Cell.— (1) No person shall be required to appear personally or through authorised representative before the authorities at the Cell in connection with any proceedings.
(2) The Cell may call for such clarification, evidence or document as may be required for the purposes of the processing of statement of tax deducted at source or for the purposes of the rectification of any order or intimation passed or sent by the Cell under the provisions of the Act.
(3) The deductor shall furnish the reply to any communication under sub-paragraph (2) in such format as may be specified by the Director General.
10. Service of notice or communication.—(1) The service of a notice or order or intimation or any other communication by the Cell may be made by delivering or transmitting a copy thereof to the deductor,—
(a) by electronic mail; or
(b) by placing such copy in the registered electronic account of the deductor on the portal of the Cell; or
(c) by any mode mentioned in sub-section (1) of section 282 of the Act.
(2) The date of posting of any communication under sub-paragraph (1) in the electronic mail or electronic account of the deductor in the portal of the Cell shall be deemed to be the date of service of such communication.
(3) The intimation, orders and notices shall be computer generated and need not carry physical signature of the person issuing it.
11. Power to specify procedure and processes.— The Director General may specify procedures and processes, from time to time, for effective functioning of the Cell in an automated and mechanised environment, including specifying the procedure, formats, standards and processes in respect of the following matters, namely:—
(a) form of correction statement of tax deducted at source;
(b) the manner of verification of correction statement of tax deducted at source;
(c) receipt of correction statement of tax deducted at source;
(d) form of rectification application;
(e) the manner of verification of rectification application;
(f) receipt and processing of rectification applications in the Cell;
(g) the mode and format of the acknowledgment to be issued by the Cell for the receipt of any document;
(h) the mode of authentication of any document or information submitted to the Cell, including authentication by digital signature or electronic signature;
(i) validation of any software used for electronic filing of correction statement of tax deducted at source or rectification application;
(j) provision of web portal facility including login facility, tracking status of correction statement of tax deducted at source or statement of tax deducted at source, display of relevant details of tax deduction or refunds to the taxpayer or deductor, as the case may be, and facility of download of relevant information;


(k) call centre to answer queries and provide taxpayer services, including outbound calls to a deductor requesting for clarification to facilitate the processing of the statement of tax deducted at source filed;
(l) provision of grievance redressal mechanism in the Cell;
(m)managing tax administration functions such as receipt, scanning, data entry, processing, storage and retrieval of statement of tax deducted at source and documents in a centralised manner or receipt of paper documents through authorised intermediaries.

[Notification No. 03 /2013 [F.No. 142/39/2012-SO (TPL)]
(RAJESH KUMR BHOOT)
Director (TPL-III)

Passbooks to Savings Bank Account-holders (Individuals) must issue by Banks - RBI

RBI noticed that many banks discontinuing in issue of Bank Passbooks to Saving Bank Account-holders (Individuals). As per RBI every customers i.e. Individuals who have Saving Bank Account must have Passbook, if Saving Bank Account-holders have not Passbook it creates so many problem while each and every transactions made by the Account-holder with Banks. See the below Notification of RBI.

RBI /2006-07/139
DBOD.No.Leg.BC.32 /09.07.005/2006-07
October 4, 2006

To

All Scheduled Commercial Banks
(Excluding RRBs)

Dear Sir,

Customer Service – Non-issuance of Passbooks to Savings Bank Accountholders (Individuals)

We have been receiving representations from customers including senior citizens' associations that many banks have discontinued issuing pass books to Savings Bank Account holders (Individuals). It has also been pointed out that this decision of discontinuing the pass book system has been taken by the banks unilaterally causing much inconvenience to the account holders. It has also come to our notice that these banks are issuing Statement of Account to Savings Bank account holders at quarterly intervals instead of at monthly intervals as stipulated in our circular DBOD.No.Leg.BC.74/ 09.07.005/2004-05 dated April 10, 2004.

2. In this connection, it may be mentioned that a passbook is a ready reckoner of transactions and is handy and compact and as such, is far more convenient to the small customer than a statement of account. Use of statements has some inherent difficulties viz. (a) these need to be filed regularly (b) the opening balance needs to be tallied with closing balance of last statement (c) loss of statements in postal transit is not uncommon and obtaining duplicates thereof involves expense and inconvenience (d) ATM slips during the interregnum between two statements does not provide a satisfactory solution as full record of transactions is not available and (e) there are a large number of small customers who do not have access to computers / internet etc. As such, non-issuance of pass-books to such small customers would indirectly lead to their financial exclusion.

3. Banks are therefore advised to invariably offer pass book facility to all its savings bank account holders (individuals) and in case the bank offers the facility of sending statement of account and the customer chooses to get statement of account, the banks must issue monthly statement of accounts in terms of our circular DBOD.No.Leg.BC.74/ 09.07.005/2004-05 dated April 10, 2004. The cost of providing such Pass Book or Statements should not be charged to the customer.

4. Please acknowledge receipt.

Yours faithfully
(Prashant Saran)
Chief General Manager-in-Charge

Clarification regarding Senior Citizen Saving Account Scheme and effect of section 80C of Income Tax.


There are some clarification about the scheme of Senior Citizen Saving Account which effect on the Tax u/s. 80C of Income Tax Act as under:

Investment in an account under the senior citizens Saving Scheme Rules-2004 is eligible for deductions u/s. 80C.

The Interest Income on deposit made in the Senior Citizen saving Scheme is not eligible for deduction u/s. 80C.

Interest on specified Bank FD (Fixed Deposit) with a 5 years terms is taxable.  Similarly, Interest on amount deposited under the Senior Citizens Savings Scheme,2004 is also taxable.

Interest payable on the amount invested in the senior citizen deposit account scheme is subject to deduction of tax at source (TDS).  Interest payment has not been exempted from deduction of tax at source.