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Displaying 1-10 of 53 Records
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benefit of house rent payment for salaried receiving hra |
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Posted: 14 Nov 2011 12:38 AM PST
HOUSE rent allowance, or HRA, is a major component of your salary. This is given by an employer to an employee to meet the cost of renting a home. As a salaried employee you can claim a tax exemption on such an amount. But there are certain conditions that you need to understand to claim such exemptions.
How is the exemption on HRA calculated?
The tax exemption on HRA is computed as the minimum of following three conditions: i) Actual HRA as per you pay slip; ii) 40%/ 50% of your basic salary; iii) The rent amount minus 10% of the salary
If you stay in a metro —Mumbai, Kolkata, Delhi or Chennai — your HRA would be 50% of your salary. In other cities/towns, it would be 40% of salary. For example, if your salary is Rs 40,000 and you live in Mumbai, HRA would be Rs 20,000 (50% of the salary). Let’s assume that you a pay a rent of Rs 15,000. The amount of rent paid minus 10% of the salary is Rs 6,000. The least of these is Rs 6,000, which would be taken as the HRA exemption. Hence the balance (i.e. rent minus HRA exemption) Rs 9,000 will be taxed.
When can you claim exemption on HRA?
You can claim exemption on rent given to parents. For example, you live with your parents and pay them rent. This would technically make your parents the landlords. In such an case, one of your parents should declare the rent paid by you in his/her personal income tax return to prevent litigation in future. However, you cannot claim exemption on rent paid to your spouse. Tax experts say that the relationship between a husband and wife is not commercial in nature and they are supposed to stay together.
You should provide your employer with accurate rent information so that the company can credit you with the eligible amount of relief before deducting tax at source. Another alternative is that you can also claim such exemption when you file the tax return and seek a refund.
If you receive HRA for the period during which you were not occupying a rental accommodation, then you can’t claim any tax exemption. In all cases it is advisable for you to maintain rent receipts as they are the only proof for rent payments.
Is your landlord an NRI?
According to Section 195, all Indian income of an NRI is subject to TDS. This rule applies to rent too. Any resident Indian is subjected to TDS for rents of over Rs 1.20 lakh per annum. “But if you have rented a house from an NRI landlord, the onus is on you to deduct tax at source and pay it to the government. The TDS is a flat 30.9%,” says Vaibhav Sankla, executive director, Adroit Tax services.
When can you enjoy the twin benefits of home loan and HRA?
If you have taken a home loan to buy a house, say, in Mumbai, but you reside in another city, you can get tax benefits on your housing loan.
If you have bought a house but stay in a rental accommodation in the same city because your house is not ready for possession, you are entitled to tax benefits on HRA. “You can claim tax benefits on the home loan only if your home is ready to live in during that financial year. Once the construction on your home is complete for possession, the HRA benefit stops,” explains Mr Sankla.
However, if you have bought a house by taking a home loan and stay in a rented accommodation after giving you house on rent, you will be entitled to all the tax benefits mentioned above.
Rent-free accommodation vs HRA
The government had announced the new perquisite rules in December 2009, which are effective retrospectively from April 1, 2009. The value of the perquisite determined in case of furnished accommodation is 10% per annum of the cost of furniture if owned by the employer. In case of hotel accommodation, the perquisite value is to be determined as 24% of the salary paid or payable or actual hotel charges paid by the employer, whichever is lower, for the period during which such accommodation is provided to the employee.
So under the new rules, should one opt for rent-free accommodation or claim exemption on HRA? You should take a decision keeping in view your requirements, salary level, perquisite value and the tax impact.
Courtesy : Taxguru |
| Posted on 14 Nov 2011 |
no property transaction on poa sc |
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Posted: 18 Oct 2011 05:09 AM PDT
The real estate sector is now under pressure following to Apex court’s latest judgment regarding the immovable property. The Supreme Court has ordered that any deal or transaction of immovable property will be considered as “illegal” through power of attorney (POA) unless the case is “genuine”.
According to market analysts argued that it is very difficult to point out the market size of POA deals, on the other hand several other sector watchers “especially in Delhi northern India 70 percent of the property deals are could constitutes.” The Supreme Court has alleged that there is extensive use of POA to transfer of Properties in the national capital, Punjab, Haryana and Uttar Pradesh, to put a stop to the practice and check generation of black money.
Realtors are used to use POA extensively from last several years it has become a trend in real estate sector to avoid taxes, thereby generating black money.
According to market experts as well as northern states, slum re-development properties and housing boards in Maharashtra have also seen significant levels of POA transactions. Huge number of real estate deals has done through POA. They added that, POA is also the common way to get done the slum redevelopment properties and housing boards in Maharashtra have also seen significant levels of POA transactions.
In the aftermath of the judgment huge number of property transactions will be severely changed, the number of transactions is unlikely to be impacted, early assessment suggests.
source - accomodation times |
| Posted on 18 Oct 2011 |
government should be facilitator instead of regulating |
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Satish Magar, President CREDAI Maharashtra
SC. Is the new ULCA in making?
SM : If you look at various reforms, land reforms need urgent government policy. The government need to play a role of facilitator. Let the market forces decide about the fair market value of land. Nobody is forcing land owners to sell. Its a fair deals.
We need land for urbanisation. We need land for public purposes. The density of population is increasing. Mcsensy report have said that we will have 60% of population in urban centres. Hence we need land, if not then government should give us cross subsidy by enhancing the FSI. If MHADA can have 2.5 FSI why not private developers?
SC : Do you think government’s cross subsidy will help ease the land holdings?
SM : I am saying that we give 36% of total earnings as taxes to government which includes VAT, Service Tax, etc. . If government subsidies the norms in FSI it will reduce the burden of land purchase in urban centres. If MHADA can have 2.5 FSI why not private developers?
SC: Can we restrict inflation in land prices?
SM : As I Said, government should cross subsidies the land or FSI, let the market be free for all private deals. I am not talking about government’s indulgence into land purchase of public purposes but let the economy be free for natural market forces. Why private land deals needs supervision?
SC: What is the principle arrangement between Magarpatta Company and its stock holders?
SM : We had given shares to land owners according to the proportionate shares of land. We had a very transparent system of corporatised land holding pattern. We developed the twonship and all the land owners are share holders of the company. The system worked.
SC: Since you have completed Magarpatta Ciy and started giving possession of Nanded City, what is the demand for and what type of people buying homes from you?
SM: 2 BHK is much in demand. We constructed 1 BHK just for statutory requirement but the demand is less. Young and second generation buyers are purchasing and they are having great taste for the real estate.
sources - accomodation times new letter |
| Posted on 08 Aug 2011 |
hafa short sales pass |
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Monday, August 8th, 2011, 12:11 pm
Servicers completed 10,438 short sales through the government's Home Affordable Foreclosure Alternatives program since it launched in April 2010, according to the Treasury Department.
HAFA was designed to provide an incentive to servicers for completing short sales and deeds-in-lieu of foreclosure for loans that fail out of the larger Home Affordable Modification Program. Through June, servicers started 21,412 short sales and DILs, up 20% from the month before. A total of 10,754 were completed, up 25%.
JPMorgan Chase (JPM: 34.06 -9.41%) is the programs leading performer, completing nearly 3,600 through the program, including nearly 1,000 in June alone.
Wells Fargo (WFC: 22.93 -9.04%) was second, completing more than 3,100 since the program launched and roughly 700 in June.
Bank of America (BAC: 6.51 -20.32%) completed 1,873 HAFA transactions, an increase of roughly 200 in the month.
Pam Marron, a senior loan officer with Gold Start Mortgage Financial Group in Tampa Bay, Fla., said more and more homeowners in negative equity view a short sale as their only way out. Many, she said, are defaulting because banks require them to do so in order to qualify for a short sale.
"The growing problem in Florida is the alarming increase in the number of short sale listings that are coming onto the market. These people are still employed but severely underwater and are having to short sale because they are not able to pay the vast difference owed between the mortgage amount and the value of these homes," Marron said. "Banks are requiring homeowners to default in order to qualify for the short sale."
In 22% of the HAFA agreements started — equal to roughly 4,700 mortgages — the homeowner began a HAMP trial but later requested a HAFA agreement or was disqualified from HAMP.
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| Posted on 08 Aug 2011 |
1 million foreclosures delayed until 2012 |
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An estimated 1 million foreclosure-related notices for defaults, auctions, and home repossessions that should be filed by lenders this year will be pushed back until next year, according to the latest report by RealtyTrac.
While the delays could give home owners more time to catch up on their payments and try to avoid foreclosure, housing experts warn this means the looming shadow inventory of distressed properties likely will continue to plague the real estate market even longer.
"The best-case scenario is we don't get back to normal levels of foreclosure activity until 2015, which means the housing market recovery gets delayed by at least a year," says Rick Sharga, a senior vice president at RealtyTrac.
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| Posted on 26 Jul 2011 |
mumbai property transactions plummet to seventy percent |
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Mumbai: According to the market reports of the previous three quarters real estate market of Mumbai facing slowdown. Reports excerpt, due to the hike in prices home buyers are keeping distance from property deals. In the aftermath of this property market has fallen severely more than 70% since the 2007 heydays, said a report by global property consultant Knight Frank.
As per the further reports unsold inventory levels are currently estimated at approximately 21% of the under-construction stock. He added that “plummet in property deals have hit very hardly in the central area of the Mumbai real estate market the hardest as the quantum of unsold inventory makes up more than 40% of the units launched in this micro market.”
Similarly in the outskirts of the central suburbs also have a comparatively high unsold inventory.
Ever since, then real estate prices have increased highly to unaffordable and in the contemporary market comparatively more than 20 percent over this 2007 highs. Whereas hike in interest rate and rise in property prices haves caused to fall in property transactions.
On the other hand government has tightened the norms for property registration may also cause to the decline in the demand of property deals. |
| Posted on 19 Jul 2011 |
smaller cities attract large realtors crisil |
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Posted: 22 Jun 2011 05:35 AM PDT
Price stability and growth prospects of smaller cities are attracting large real-estate developers. The developers are diversifying from metro cities with an eye on future growth. A recent report released by Credit Rating and Information Services of India Ltd(CRISIL) Research, titled ‘Real(i)ty Next: Beyond the Top 10 Cities of India’, estimates the sales of new residential apartments in 10 such smaller cities at around Rs 180 billion in 2012.
The study details the planned supply, the expected demand and the outlook for prices in 65 submarkets across the 10 cities: Bhopal, Bhubaneswar, Coimbatore, Indore, Jaipur, Lucknow, Nagpur, Surat, Vadodara and Visakhapatnam. Almost 354 million sq ft of supply has been planned in these cities over the next three years.
The research finds that the smaller cities offer better price stability and demand growth. It foresees prices rising in seven of the smaller cities. In contrast, prices are likely to increase only in four of 10 large cities–Ahmedabad, Bengaluru, Chandigarh, Chennai, Hyderabad, Kochi, Kolkata, Mumbai, National Capital Region and Pune.
Affordability in smaller cities is greater, as prices have not risen as much as in the large cities. Prices increased only by 10-12 per cent in the smaller cities over the two years up to April 2011. In contrast, prices rose by 25-30 per cent in the large cities.
“The proportion of buyers taking home loans is relatively lesser in these smaller cities. A gradual increase in penetration of home loans would boost demand. Moreover, a shift in preference from
independent houses to apartments will also support volumes,” said Prasad Koparkar, Head– Industry and Customized Research, CRISIL Research.
The growth prospects in the smaller cities are attracting large developers with multi-city presence. A few large developers already have a presence in Bhopal, Lucknow, Indore, Jaipur, Nagpur and Coimbatore. Many of the developers are building land banks in these cities.
source - accomodation times |
| Posted on 22 Jun 2011 |
fdi in multi-brand retail states consent requires |
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The Central Government is taking into consideration 51 percent FDI in political sector, as it could be diminishing the international retail process. According to the sources to apply this will require state government’s approval to open retail stores as trade becomes state matter. Wal-Mart, Metro and Carrefour like these companies are waiting from long time to invest in India that it will open its Foreign Direct Investment (FDI) in multiple brand retail industry, sources said. They added that “even after getting green signal from Central Government several states will not accept this particularly those states which are ruled by the BJP, as it will have a huge impact on their front plans.
According to the officials “Committee of Secretaries (CoS) meeting held on 15th June spear- headed by the Cabinet Secretary Ajit Kumar Seth regarding allowing FDI into political sector.” The entire CoS was having mutual consideration that FDI must be open for political sector. But CoS meeting will again held prior sending final cabinet note, committee will finalize the modes, they added.
Inter-Ministerial Group (IMG) on Inflation, led by Chief Economic Advisor in the Finance Ministry, Kaushik Basu is supporting to the Department of Industrial Policy and Promotion (DIPP) as it is raising the issue. The faction is very serious to allow FDI sooner according to them this will bridge the gap between farmers and consumers.
In the contemporary Indian market government permits only in single brand retail chains such as Nike, Louis Vuitton with only 51% whereas it allows 100% FDI in wholesale sector. There are several big companies are still seeking for state permission in multi-brand retail. |
| Posted on 20 Jun 2011 |
mchi committee to enforce code of conduct for developers |
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Mumbai, May, 2011: A code of conduct for developers and a grievance reddressal mechanism are high on the agenda for the newly elected managing committee of MCHI (Maharashtra Chamber of Housing Industry).
Soon after taking over as the new President of MCHI last night, Mr. Paras Gundecha stressed the need for image makeover for the entire developer community and a code of conduct would help earn goodwill for them from among the society at large.
Outgoing President Mr. Sunil Mantri formally handed over the charge to Mr. Gundecha. Mr. Gundecha then announced and welcomed Mr. Boman Irani as the new Honorary Secretary and also as announced the new managing committee, that took charge of MCHI at the event attended by the developer fraternity.
Mr. Gundecha said the new committee would be keen to ensure that an aggrieved customer comes to MCHI before knocking the doors of courts. For this, a grievance reddressal system would be put into practice, he said.
MCHI would also strive for an increased interaction with the government to resolve all issues impacting the real estate industry and for a frequent contact among the various associations belonging to the sector for an improved communication across the Mumbai Metropolitan Region.
Taking the grievance reddressal mechanism forward, newly elected Honorary Secretary of MCHI Mr. Boman Irani said the Chamber would soon call for suggestions from the members and customers.
Mr. Irani recalled that Mr. Lalit Kumar Jain, national President of CREDAI (Confederation of Real Estate Developers Associations of India) had recently pointed out that the developer community was doing a lot of good work for the society than any other industry. But, unfortunately, this aspect was unknown, and hence the developer fraternity was never appreciated; he said and underscored the need for continuing the good work and spreading this information.
The new committee’s focus is on having clarity and transparency and providing affordable housing for the masses. The agenda for the committee include issues like Homes for All, Rental and affordable housing scheme, Slum redevelopment, ULC reforms, single window clearances, stamp duty on the basis of carpet area, norms for high rise buildings and townships and environment related matters.
The new MCHI Managing Committee for 2011 – 2012 is:
President
Paras Gundecha
Immediate Past President
Sunil Mantri
President – Elect:
Vimal Shah
Vice Presidents:
Dharmesh Jain, Mayur Shah, Nayan Shah and Deepak Goradia
Hon. Secretary:
Boman Irani
Hon. Joint Secretaries:
Rasesh Kanakia, Harish Patel, Nainesh Shah – President (MCHI Thane Unit)
Treasurer:
Ashok Mohanani
Jt. Treasurers
Mukesh Patel and L.P. Bhagtani
Co-ordinators:
Pujit Agarwal, Sukhraj Nahar and Sandeep Runwal
Committee Members:
Sandeep Raheja, Bandish Ajmera – President (MCHI Kalyan – Dombivli Unit), Sujal Shroff, Parag Munot, Rajan Bandelkar, Vikas Walawalkar, Jayesh Shah, Nayan Bheda
Sanjay Chhabria and Chaturvedi R.R.
Invitee Members:
Mukesh Mehta, Sanghvi Rakesh,and Jagdish Ahuja
Affiliated Member Units:
Ajay Ashar (Secretary – Thane), Shrikant Shitole (Secretary – Kalyan-Dombivali), Shailesh Sanghvi (Secretary – Mira Virar City), Rajesh Prajapati (President – Raigad) and Suresh Hawre (President – Navi Mumbai). |
| Posted on 26 May 2011 |
downtrend in property registration as new rules comes |
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NEW DELHI: Existing wounds are not enough to real estate market so state government have added more wounds in the form of new rules as State Government has made it essential to produce a building sanction plan and structural safety certificate as a prerequisite to any form of registry. According to the sub registrar officials almost in every parts of districts ratio of property registration have declined very harshly. He added that in the recent past the average was 100 registrations per day whereas the current report is just 7 to 8 daily.
On 30th March Central Government’s revenue department has issue notice which banned registration of transactions of all structures not supported by sanctioned building plans or where sanctioned plans show major structural deviations. Order also states that vendor and vendee both have to submit a certificate of structural safety issued by the competent authority.
The order issued after the review meeting held in January, the Lieutenant Governor of Delhi, Tejendra Khanna said that there is urgent need of a special task force to crack down on land sharks and unauthorized construction.
source - accomodation times |
| Posted on 06 Apr 2011 |
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