Which ITR form to fill

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Which ITR form to fill  and tips on how to fill it

The Central Board of Direct Taxes (CBDT) notified tax return forms for the Financial Year (FY) 2016-17 on March 31, 2017.

The government also mandated quoting of Aadhaar number/ Aadhaar enrolment number while filing the tax return if the same is filed on or after July 1, 2017.

As per a recent notification dated May 11, 2017, relief from obtaining Aadhaar has been provided to below taxpayers:

* Taxpayer residing in the states of Assam, Jammu and Kashmir and Meghalaya;

* A Non-resident taxpayer as per Income-tax Act, 1961;

* A taxpayer of the age of eighty years or more at any time during the previous year;

* A taxpayer who is not a citizen of India.

 

1. Below is a brief synopsis of the tax return forms applicable to an individual taxpayer for filing income tax return for the FY 2016-17:

It is very important to file the correct tax return form, as filing of incorrect tax return form may make the tax return defective.

Below is a table to help you pick the right form

Applicability of the different ITR forms
* For ITR-1 Form, only the income which is eligible to be reported in ITR-1 can be clubbed with the income of the taxpayer. 
For example, if spouse of the individual taxpayer has income only from other sources which needs to be clubbed, Form ITR-1 can be used to report such income. However, if the spouse has earned income from capital gains, then the individual taxpayer will have to file ITR-2. 

 

2. Major changes from last year:

A separate column has been inserted in all forms to disclose aggregate cash deposited in excess of INR 2 lakh during the demonetisation period i.e. 9 November 2016 to 30 December 2016.

A. ITR-1 form

* The form has been simplified and reduced to one pager;

* 'Asset and Liability' schedule has been done away with in ITR-1 form since it is required to be filled only when the total income of the taxpayer is more than INR 50 lakh.

B. ITR-2 form
* 'Asset and Liability' schedule (applicable to individuals having total income more than INR 50 lakh) now requires reporting of additional information with respect to bank balance (including deposits) as on 31 March 2017, description and address of immovable assets, cost of shares and securities as on 31 March 2017, insurance policies, loans and advances given, interest held in assets of a firm or association of persons (AOP) as a partner or member etc.;

* 'Schedule IF (i.e. information regarding partnership firms in which the taxpayer is a partner) has been inserted to report details of the partnership firm in case the taxpayer is a partner in one;

*'Schedule BP (i.e. details of income from firms in which the taxpayer is a partner)' has been inserted to report details of income in the nature of salary, bonus, commission or remuneration received from partnership firms;

* Under the 'Schedule OS (i.e. Other Sources)', additional information is sought with respect to cash credits, unexplained investments, unexplained money, unexplained expenditure, amount borrowed or repaid on hundi, dividend income from Indian companies in excess of INR 10 lakh, royalty income from patents etc.

C. ITR-3 form

* Under the 'Schedule OS', additional information is sought with respect to cash credits, unexplained investments, unexplained money, unexplained expenditure, amount borrowed or repaid on hundi, dividend income from Indian companies in excess of INR 10 lakh, royalty income from patents etc.

 

3. General guidance on filling and submitting the tax return forms:

* The name filled in the ITR form should be as per the Permanent Account Number (PAN) card;

*The taxpayer should ensure that e-mail address, phone number and postal address are correctly stated in the tax return since the same are used by Income-tax Department for future correspondence with the taxpayer. Quoting of PIN code is mandatory;




* Quote Aadhaar/ Aadhaar enrolment number (if applicable) if filing the tax return after 30 June 2017;

* ITR-1 form can be filed in paper form only by:
a) An individual of the age of 80 years or more at any time during the financial year for which the return is being filed ; or

b) An individual or HUF whose income does not exceed INR 5 lakh and no refund is claimed in the return of income.

* In case the return is filed in paper form, no document (including TDS certificate) should be attached to the return;

* While filling ITR-1 in paper form, ITR-V should be duly filled;

*All other return forms have to be filed electronically;

* Check Form 26AS for income and taxes reported by the deductor so that there is no mismatch with the income and credit of taxes claimed in the tax return vis-à-vis Form 26AS;

* Ensure that outstanding taxes are paid before filing the tax return and use correct challan to avoid mismatch;

*Report all bank accounts held in India at any time during FY 2016-17 provided they have been operated in last three years. This includes reporting of joint accounts in which the taxpayer is the primary holder;

* Bank balance (including deposits) and cash in hand as on 31 March needs to be reported in 'Asset and Liability' schedule. While a common man may not know exact amount of cash held physically on 31 March 2017, it should be ensured that the amount declared in the tax return can be reasonably justified in case of scrutiny by the Income-tax Department;

* Foreign Asset schedule requires reporting of assets held outside India at any time during the relevant year only by a taxpayer qualifying as Resident and Ordinarily Resident of India. Since the Black Money Act 2015 imposes a stringent penalty of INR 10 lakh for non-disclosure of foreign assets and income, it is recommended to take help from a subject matter expert to avoid non-compliance in terms of type of asset to be reported and the value at which the asset should be reported;

 

* As per the CBDT notification on foreign tax credit rules, a resident taxpayer claiming credit of taxes paid outside India on doubly taxed income should file Form 67 along with specified certificate or statement on or before the due date of filing the tax return. The manner to file Form 67 and certificate or statement is yet to be prescribed by the CBDT;

* Reporting and disclosure requirement in ITR-3 form has been enhanced to ensure compliance by the taxpayers. However, a layman may not have complete details of requisite information sought in the tax return form and hence seeking help of a tax expert may be advisable;

* Taxpayers should ensure that the tax returns they file are verified, either manually or electronically, within 120 days of filing to avoid annulment of the tax return;

* In case the taxpayer wishes to manually verify the ITR-V form by sending a signed hard copy to CPC Bangalore, he should ensure that ITR-V is printed on A4 size paper and signed with blue ink only before sending to CPC Bangalore;

* ITR-V can be e-verified by generating electronic verification code using Aadhaar, net banking, bank account number, demat account or registered e-mail address and mobile number etc. of the taxpayer;

* Instructions for filling the tax return forms issued by CBDT and annexed to the relevant ITR form should be referred to before filing the tax return.

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Top 10 Tax Saving Mutual Funds of 2018

Best 10 ELSS Mutual Funds to Invest in India of 2018

1. Tata India Tax Savings Fund 

2. Mirae Asset Tax Saver Fund

3. DSP BlackRock Tax Saver Fund

4. Sundaram Diversified Equity Fund

5. Birla Sun Life Tax Relief 96

6. ICICI Prudential Long Term Equity Fund

7. Invesco India Tax Plan

8. Reliance Tax Saver (ELSS) Fund

9. Axis Tax Saver Fund

10. BNP Paribas Long Term Equity Fund

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SBI Magnum Midcap Fund

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SBI Magnum Midcap Fund scheme aims to provide investors with opportunities for long term growth in capital along with the liquidity of an open-ended scheme by investing predominantly in a well-diversified basket of equity stocks of Midcap companies.

After a bumpy ride until 2010, this fund has managed a steady improvement in performance, earning itself a four-star rating for much of the last three years.

SBI Magnum Midcap Fund has managed a consistent outperformance of both its benchmark and peers in the last four years. This is among the most true-to-label funds in the mid-cap category, with 65 to 70 per cent of its portfolio steadfastly parked in mid-cap stocks; it has a residual small-cap allocation. It rarely takes refuge in large caps, which make up about 5 per cent of its assets. The mid-cap universe for it is defined as the 101st to the 400th stock ranked by market cap.

SBI Magnum Midcap Fund scheme looks for structural growth stocks or emerging companies in any sector which are growing faster than its peers. It filters for capital-light business models, high scalability, strong management track record, high promoters' holding and consistent dividend and tax payouts.

After a consistent show until 2016, the fund has suffered a few hiccups in the past one year as it has had trouble outpacing the benchmark and the category. The fund's trailing one-year return lags behind the benchmark and category returns by double-digit margins. This has tended to weigh on the three-year record as well, though the fund still outpaces its benchmark by 4 percentage points on a five-year basis. The fund's clear mid-cap and growth tilt could have worked against it at a time when large-cap and deep-value stocks had a strong bounce-back.

A good performer in a challenging category, but the recent slowdown bears watching.

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Invesco India Growth Fund

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Invesco India Growth Fund is now called Invesco India Growth Opportunities Fund

Given the recent volatility in the stock market, it makes sense to stay with large-sized companies showing healthy earnings growth, thanks to their long-established presence in the organised part of the economy. One of the funds that understand this strategy well is Invesco India Growth Fund, managed by Taher Badshah and Amit Ganatra.

Invesco India Growth Fund, which could be categoried as an all-weather equity fund, takes the bottoms-up approach to investing, and the fund managers believe in taking controlled risks. With respect to the benchmark index (S&P BSE100), the fund managers are up to 50% overweight on a sector or underweight. There is no deviation from this norm. Another factor that explains the fund managers' strategy is to accommodate companies based on growth and value themes. This protects severe downside during declines.

The fund managers choose stocks at reasonable valuations. In portfolio of 36 stocks, the scheme has 75% of its portfolio is dedicated to the growth theme, while the rest is committed to the value theme. Due to this strategy, the scheme has outperformed its peers and the benchmark by a good margin. In the past three-year and five-year periods, the scheme has given 27% and 13.7% returns (annualised), while its benchmark has given 19% and 8% returns, respectively.

At present, the Invesco India Growth Fund scheme is overweight on themes such as consumer discretionary, financials and industrials indicating that the fund managers are banking on consumption and economic recovery themes.

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You can claim HRA as well as tax deduction on Home Loan

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It seems counter-intuitive that you can avail house rent allowance as well as deduction for your home loan. Here are some circumstances in which you can

For some people, the tax-planning season has just started. You know that house rent allowance (HRA) and the deduction related to home loan repayment can lower your tax liability. You will be pleased to know, in certain cases, you can avail tax benefits from both of these. Here's how:

HRA and home loan

HRA exemption can be claimed under section 10(13A) of the Income-tax Act, 1961. To calculate this exempted amount, lowest of these three is considered:

1) Actual HRA received from the employer,

2) 50% of salary if employee lives in a metro city; and 40% if the employee lives in a city other than a metro, and

3) actual rent paid minus 10% of salary (basic plus dearness allowance plus turnover-based commission).

Home loan tax benefits are calculated in a different manner. In case of a home loan, the deduction on principal repayment can be claimed under section 80C of the income-tax Act, up to the threshold limit Rs 1.5 lakh, or the actual principal repaid—whichever is less. The benefit on interest portion of the loan repayment can be claimed up to the threshold limit of Rs 2 lakh, under section 24b of the Act.

How to claim both

You can claim HRA exemption as well as the deduction for home loan repayment if you own a house—which has a home loan—and live in another house on rent. The caveat is, the house you own and the one you live in should be in different cities; and you should have a good reason for not living where you own the house. The reasons for this could be that you work in a different city, or even that your office is too far from your house—in case the house is in a distant suburb of the city.

But remember, you may need to provide these explanations to your employer or the income-tax authority in case there is a scrutiny of the details provided by you.

Apart from this, you can also claim both these benefits if you take a home loan to buy a house that is under-construction, and during the period of construction you live in a rented house. In this case, you can claim the HRA exemption as well as the home loan deduction for that period.

However, the home loan deduction benefit can only be claimed for payment of interest component of the loan, and not for principal repayment. Also, you can claim it in five equal instalments over the years, after you get possession of the house.

The third case in which you can claim both the benefits is when you have rented out the house on which you have a home loan, and you live in another house on rent.

The reason for doing so could be that the house you own does not suit your needs, perhaps because it is too small.

In this case too, you can claim both HRA exemption and the home loan deduction, but at the same time you will have to disclose the rental income that you earn from the let out property.

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Aditya Birla Sun Life Top 100 Fund

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Aditya Birla Sun Life Top 100 Fund is now called Aditya Birla Sun Life Focus Equity Fund

How has the Aditya Birla Sun Life Top 100 Fund performed? 
With a 10-year return of 10.2%, the fund has outperformed both the benchmark (6.1%) and the category average (7.7%) by a wide margin. 

The fund has comfortably beaten both the index and its peers over the past decade. 

Aditya Birla Sun Life Top 100 Fund  has been a consistent outperformer for many years under its current fund manager. It is undergoing a transformation, taking on a more focused approach instead of a diversified startegy. It will remain a true-to label large-cap offering, but will be distinct from its larger sibling, Aditya Birla Sun Life Frontline Equity, which is a diversified fund. Accordingly, the fund portfolio will become more compact, with the fund manager taking larger positions in high conviction bets. It will also retain higher flexibility to deviate from its benchmark index at a sectoral level. This will potentially allow it to generate higher return but could be accompanied by higher volatility. Investors looking for a focused large-cap scheme may consider this fund. 

 

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Franklin India High Growth Companies Fund

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Franklin India High Growth Companies Fund is not Franklin India Focus Equity Fund

A large number of big-sized companies clocked double-digit revenue growth in the December 2017 quarter. This could be a good starting point for savvy investors to enhance their exposure to large companies through a schemes that not only focus on large-sized companies, but also believe in value investing. Franklin India High Growth Companies is one such scheme which is value conscious and selects companies that are likely to deliver earnings growth higher than the market.

Fund managers Anand Radhakrishnan, Roshi Jain and Srikesh Nair follow key valuation parameters, such as enterprise value, price-to earnings growth ratio, forward price-to-sales ratio and discounted earnings per share in selecting companies for investments. Taking into account these valuation parameters, the fund managers invest in companies which are poised for high growth in their sectors. The scheme has more than 60% of its portfolio dedicated to large-sized companies, and 30% to mid- and small-sized companies.

In the past three-year and five-year periods, the scheme has given returns of 9.4% and 22.4%, respectively, while its benchmark index, Nifty 500, has given 8.7 and 14.7% during the same periods. In the past six months, the scheme's fund managers have bought in value themes represented by Infosys, Mahindra & Mahindra and GAIL.

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Why not to Repay your Home Loan early

 

If you are continuing to pay equated monthly instalments (EMIs) on a home loan and wondering if it makes sense to repay the principal rather than continuing it, keep in mind these three checks before making a choice.

As a thumb rule, continuing a loan makes sense if your interest rate is lower than the potential return on investment for the lump sum. Let's say, you have Rs10 lakh left to repay. If you use this for repayment, you save on an annual interest cost of say 8.5%. Now, if you don't repay the loan, you can invest the Rs10 lakh in other securities. If there is an investment opportunity where you can earn more than 8.5% per annum, assume 10%-it will make more sense to utilize the corpus towards the investment rather than repayment. By doing so, your net result is a gain; in this case, it's an annualized gain of 1.5%. You earn 10% on the corpus and utilize 8.5% out of that for the EMI; rest is yours. By repaying the loan in full, you miss the opportunity for higher returns.

If the loan has less than 5 years to finish, chances are that you are repaying more principal with each instalment rather than interest. Interest proportion in an equated monthly payment is on reducing balance. The question of early repayment is more relevant when your interest component is high. Also, it could be that the alternative investment you want to make with the lump sum is in equity or a combination of equity and debt to earn more than the interest you pay. However, equity-linked returns are usually not linear, which means you are likely to see desired annualized return only if you remain invested for at least 5-7 years. Hence, don't substitute such an investment instead of the repayment if time to repayment is only a few years.

A housing loan gives you a tax benefit on the principal repayment and on the interest repayment (if you have the possession). To that extent, if you are claiming tax benefit, your net annual cost of the loan is lower. Make this calculation and then assess if you will be able to earn more per annum by investing the lump sum; if not then it makes sense to repay.

Other than these above considerations, consider pre-payment fee or cost if any.

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Canara Robeco Emerging Equities Fund

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Canara Robeco Emerging Equities Fund scheme seeks to generate long term capital appreciation by primarily investing in diversified mid cap stocks that have a potential to emerge as the bigger corporates with higher performance. For the Purpose of this fund, mid & small companies are defined as those which are ranked from 151 to 500 on the basis of market capitalization.

Consistency over time, rather than an ability to trounce the category, has been the hallmark of this fund, which has hovered between a three and four star rating for nearly seven years now.

Canara Robeco Emerging Equities Fund is a sector-agnostic fund which looks out for opportunities across sectors with a bias towards mid-caps. Its attempt is to identify companies which have the potential to become leaders of tomorrow in their respective sectors. It uses a growth-at-a-reasonable-price approach to pick companies which show consistent earnings growth higher than that of the market.

The portfolio break up reveals almost equal weights in large and mid-cap stocks, at 40 per cent each recently. But historically, the fund has had a much higher exposure of 60 per cent plus to mid and small-caps, with a 15 per cent weight in large-caps. The shift may have been driven by the need to contain risks at elevated market levels. The fund is currently overweight on large-caps relative to the category.

Canara Robeco Emerging Equities Fund shift towards large-caps seems to have been timely, as it has kept ahead of both benchmark and category in the last one year. On a three and five-year basis, it has outperformed its benchmark by 3 to 9 percentage points and category by 3 to 5 percentage points. The performance relative to the benchmark suffered a blip in 2016 but has made a comeback since then. Overall, it's a fund which has kept up well with the ups and downs of the market.

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Take sufficient Insurance Coverage

There are hosts of insurance products available to meet such needs. Equally important is the amount of sum assured. Unlike developed countries, most Indian don't pay much attention to having an adequate insurance cover. 

Individuals need insurance to protect them against the risk of dying early, risk of living long, risk of surviving a dreaded disease, risk of living with total and permanent disability, risk of high medical expenses, so on and so forth. There are hosts of insurance products available to meet such needs. Equally important is the amount of sum assured. Unlike developed countries, most Indian don't pay much attention to having an adequate insurance cover.

As per the available public data, life insurance accounts for only 19 per cent of total household savings. Further, life insurance penetration in India is merely 2.72 per cent compared to 3.74 per cent in Asia and 3.99 per cent in Europe. Globally, the average rate of life insurance penetration is 3.47 per cent. Insurance density (premium per capita) is another measure of insurance purchased in a country. Life insurance premium per capita for India stood at $46.5 as against $229.5 for Asia and $961.9 for Europe.

World's average insurance density stood at $353, which is about 7.5 times the life insurance density of India. This clearly reveals that we as a community are underinsured. More needs to be done to increase awareness about life Insurance.

In case you are thinking that the under-insurance is because of the rise in the rates of insurance premium, then you are wrong. Industry estimates show that in the last four years, the rates of premium have increased by a mere 3-to-4 per cent with a CAGR of 2.79 per cent for sum insured of Rs 2-3 lakh and 3.29 per cent for Rs 5-10 lakh. So what is the actual reason?

The main reason behind the insufficient amount of cover is that people haven't revised their health cover or term insurance that they have bought. And in case of coverage sponsored by employers, it has stagnated. Industry estimates show that Indians who are full-time employees in a company are of the notion that the coverage that they receive under the company's group scheme is sufficient. As a result of this, they have ended up paying hefty medical bills whenever they have experienced a medical emergency.

While the statistics show that 22 per cent of India's population is insured, it is majorly on account of the different government schemes. The harsh reality is that only five per cent Indians are insured.

Out of which, two-thirds are under-insured. In recent times, the minimum expense of a major medical procedure is Rs 3 lakh in private hospitals and if the hospital is a corporate one, the cost will only rise higher because of cross-referrals and multi-disciplinary treatments. The same study also shows that in coming times, the healthcare costs are bound to catch up with other developed foreign countries. It also shows that the percentage of the claims reimbursed or paid vis-a-vis the amount of the medical bills is falling, especially when it is above Rs 3 lakh.

Life Insurance is perhaps is the best way to protect your loved ones. It is not only a financial choice but is also an emotional decision. There are many compelling reasons to buy life insurance:

 

• People buy life insurance as a tool to protects their spouse and children from potentially devastating financial losses that may occur in case of one's demise
• Life insurance protects and provides financial relief for those who need to carry on without the person who's moved on to other realm "        Life insurance is an expression of love and care for your family "       
• By protecting the financial future, an insured enables his / her loved ones to maintain a certain lifestyle, in case of a grave eventuality
•  Life insurance provides the deceased's family a range of options that aids them repay loans, meet EMIs and meet other ongoing expenses

Is Life Insurance from your employer sufficient? It is noteworthy that about half of the working population is self-employed and there is about one third of working population who are casual / contractual workers. Such self-employed and contractual/casual workers may not necessarily have any formal insurance and therefore are likely to be significantly under-insured.

 

Most employers generally provide life insurance and medi-claim coverage to their employees. The need of insurance for each individual may be different and the group insurance coverage may not be sufficient to protect a family against the financial stress in case of the bread earner's demise. In event of unfortunate death of the breadwinner of the family, money is needed to:

 

• Repay debts, such as car loans, home loans, personal loans, educations loans, Credit Card dues, etc.
• Meet ongoing expenses of the family, such as day-to-day expenses, educational expenses, housing expenses, medical /hospitalization costs

Under employer-employee Group Life Insurance, most employers provide an insurance coverage of roughly equal to one time annual salary. A few employers provide higher coverage, say up to three times the annual salary or some other graded sum assureds.

 

How much Insurance should one take? Every individual has a different family status and financial responsibilities, which impact their insurance needs. The rule of thumb is to take insurance coverage, which is sufficient to repay all your liabilities and debts. You should have enough cover to secure future costs that your family will need to incur. Be mindful to include inflation over the next 15-20 years. You may also want to take into consideration existing wealth (without any lien) that you have built, which if required, may be disposed of by family. It may not be appropriate to consider your home as wealth, because the family will require it to stay.

The employer-employee coverage is available till the time you are in employment. The cover will expire as soon you cease to be in employment. Therefore, it is important to take additional coverage in form of independent individual life insurance policy for appropriate sum assured. You may like to check with the same life insurance company, which has covered you for the group employer-employee cover.

Invest Rs 1,50,000 and Save Tax up to Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds. Save Tax Get Rich

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Tax changes that will come into effect from April 1

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Arun Jaitley did not tinker with the income tax slabs nor did he raise the exemption limit in Budget 2018, but there were a few proposals that will have an impact on how much taxes you will end up paying.

Here are 10 income tax changes that will come into effect from April 1, 2018, once the Finance Bill is passed by the Parliament.

• Re-introduction of standard deduction

In a relief to the salaried class, the FM has re-introduced standard deduction of Rs 40,000 from salary income. Apart from salaried class, even pensioners will be allowed to avail the benefit of this deduction. Central Board of Direct Taxes (CBDT) Chief Sushil Chandra has clarified that to avail this tax benefit one would not be required to submit any proofs or bills, it can be claimed straightaway.

Transport allowance and medical reimbursements to become taxable

While standard deduction has been reintroduced, the tax benefit available on transport allowance and medical reimbursements has been taken away. Currently, transport allowance of Rs 19,200 and medical reimbursement of Rs 15,000 per annum is exempted from tax. If the Budget is passed by the Parliament, then starting from April 1, 2018, these two allowances will become a taxable part of your salary.

• Cess hiked to 4 per cent

Cess levied on your tax liability has been hiked by 1 per cent from the current 3 per cent to 4 per cent. This cess will be called "Health and Education Cess." So, if you have net taxable income of Rs 5 lakh, your tax outgo will marginally increase by Rs 125. Similarly, for someone with a net taxable income of Rs 15 lakh, their tax liability will increase by Rs 2,625.

• Introduction of tax on long-term capital gains (LTCG) on equity and equity-oriented mutual funds

Starting from April 1, tax will be levied on LTCG arising from the sale of equity and equity-oriented mutual funds. Earlier, these gains were exempt from tax. It will be charged at a rate of 10 per cent plus cess at 4 per cent. However, to provide relief to small investors, LTCG up to Rs 1 lakh will be exempt from tax per fiscal.

• Increase in tax-exempt limit of interest income for senior citizens

In a bid to provide relief to senior citizens, Budget has proposed to increase the tax exempt limit on interest income for senior citizens from Rs 10,000 to Rs 50,000. Interest income will include interest earned from fixed deposits (FD) and recurring deposits (RD).

• Raising the threshold limit for the TDS for senior citizens

Along with the raising the limit of tax-exempted interest income for senior citizens, an amendment has been proposed in the tax deducted at source (TDS) TDS law. As per the proposed change, no TDS will be deducted from interest incomes up to Rs 50,000 a year for senior citizens.

• Hike in the deduction limit on medical expenditure

It had been proposed to raise the limit of deduction under section 80D and section 80DDB for senior citizens. Under section 80D, the limit has been proposed to be hiked from Rs 30,000 to Rs 50,000. Similarly, under section 80DDB, the limit has been hiked to Rs 1 lakh for all senior citizens from Rs 60,000 (in case of senior citizens) and Rs 80,000 (for super senior citizens).

• Dividend distribution tax on equity mutual funds

Tax at the rate of 10 per cent will be levied on the dividends distributed in case of equity mutual funds. However, this dividend will remain tax-free in the hands of investors. The tax will be deducted by the fund houses before distribution of dividend. This will impact investors who were relying on dividends from balanced funds as a source of regular income.

Extension of Pradhan Mantri Vaya Vandana Yojana

Pradhan Mantri Vaya Vandana Yojana (PMVVY) has been proposed to be extended till March 31, 2020. Along with the extension of scheme, the maximum investment limit has also been proposed to increase to Rs 15 lakh.

• Tax-exemption on NPS corpus for self-employed

For self-employed people, it has been proposed to exempt 40 per cent of the total amount payable from tax upon closure of National Pension System (NPS). This tax benefit will now bring self-employed individuals at par with the salaried class.

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