Tax liability and Investment options available

Tax liability and Investment options available

I am getting a rental income from Hong Kong in my bank account since march 2016. The amount is 13500 HK dollars. How much tax liability would be there on me after a year and how much I can save by doing investments?
I was not filing any income tax from last 13 years in India and I have just shifted in India from last 1.5 years.
Please advise

kartikemails@gmail.com

Asked 8 years ago in Income Tax

Please let me know whether 13500 is per month or 13500 is per annum. If its is per month than you dont need to pay taxes. If it is per month you will have to file return and pay taxes.

If 13500 is p.a., Your rental income chargeable to tax will be 9,63,900 considering exchange rate as 8.5

This can be further reduced by making investment upto 150000 under section 80C, maximum 50000 under section 80CCD and maximum 50000 under section 80D.

These are the common deductions available. List is long. We can discuss it over a call.

Please feel free to revert in case of any queries.

Thanks and Regards,

CA Abhishek Dugar

Abhishek Dugar

CA, Mumbai

3576 Answers

183 Consultations

Talk to Abhishek Dugar

Dear Sir,

1) As you are Resident of India under the Income Tax Act your income will be taxable in India. However, you may get benefit under the Double Taxation Avoidance Agreement if the income earned abroad is taxable in that country, Since there is no such agreement between India and that country, then your your tax shall be computed on the lower rate between the two countries as per sec 91.

2) Income Tax on Rent received shall be taxable under head House Property and is levied in the same manner as Resident Indian. Out of the Total Rent received, Municipal taxes are first allowed to be reduced. After that, from the balance amount – 30% is allowed as standard deduction and Deduction for Interest paid on Home Loan is allowed. The manner of computation of income tax is mentioned under Sec 24 of the Income Tax Act.

For any further clarification please feel free to contact.

Regards

CA SK Agarwal

Shiv Kumar Agarwal

CA, Delhi

489 Answers

74 Consultations

Talk to Shiv Kumar Agarwal

Hello Sir,

Please clarify if this is an annual rent or a monthly rent ?

Rohit R Sharma

CA, Mumbai

2104 Answers

95 Consultations

Talk to Rohit R Sharma

Dear Sir,

You will get a flat 30% deduction on your rental income.

Plus you can save up on taxes by investing funds in various options like Life Insurance, PPF, Pension Scheme, Medical Insurance, ELSS depending on your financial needs. Please take a careful decision before planning out your investment options.

Trust this clarifies your query.

Feel free to get back/ call back for any further clarifications.

Regards,

Rohit R Sharma

BCOM, ACA, LLB-GEN, CERT. FAFP

Rohit R Sharma

CA, Mumbai

2104 Answers

95 Consultations