Monthly Archives: February 2008

NRIs Ride High On Stocks and Real Estate.

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Indian Stock Market and Real Estate sector is attracting NRI attention in a huge way. Non-resident Indians are more and more tending towards investment in these two sectors. This is primarily due to the fact that India is growing at a faster pace than other countries and the equity market has outperformed those of developed nations.
NRIs know the potential of investments in India very well but find it difficult to execute a comprehensive plan. Most green card holders have not capitalized on the Indian growth story because of their poor evaluation of the market. NRIs rarely find time from their hectic professional life, they lack proper advice or find handling and monitoring investment transactions inconvenient, says Anand KS of Nile Financial Planners.
Another point of concern felt by NRIs is the transparency level on charges in various trading sites and other investment options. Remember to ask for details regarding time horizon of investment, risk and return before starting off and opening accounts.
To invest on a repatriable basis, the person must have an NRI or FCNR bank account in India. In this case, the net income or capital gains after tax is eligible for repatriation subject to regulatory guidelines. In the case of investment on a non-repatriation basis, only the net income the dividend arising out of investment is eligible for repatriation.

Indian construction sector outlook positive for 2007-08 – Fitch.

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MUMBAI – Fitch Ratings said it sees the outlook for the Indian construction sector in 2007-08 as positive, boosted by increased investment in infrastructure projects and real estate.
The ratings agency noted that while Indian construction companies have witnessed sharp growth in their order books and revenue with the increase in investment projected over the next five years, the majority of the profit in terms of revenue and earnings will start accumulating from fiscal year 2009.
Fitch also said it imagines that the industry to exhibit negative cash flow from operations due to increased working capital requirements. Substantial investments in real estate will also put pressure on the industry credit profile, it added.
The ratings agency warned that credit profiles are likely to deteriorate, with increased debt required during the mobilisation phase to complete the massive projects but will get better substantially over the long-term once these projects achieve the stable revenue phase.

Hyderabad, an investors choice in Indian Real Estates.

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Hyderabad is among the foremost choices for community who wish to invest in Indian Real Estate. Hyderabad is a place with a soaring economic growth, outstanding architecture, great infrastructure, and a flourishing Real Estate and construction industry.A lot of the property is at a standstill in the form of plans on paper but already the sale and purchase of these properties is a fine business. There are various properties that have  already been visited by many owners despite the fact that construction has not even started. People are making money from property in Hyderabad basically with just land and nothing on it.Real Estate has perhaps made more millionaires as compared to other industries in Hyderabad. Real Estate Investing also presents many rewards including cash flow, security, long-term wealth and a number of tax benefits.
Real Estate Investing is something that anyone can learn and prosper at despite of age, gender, religion, race, education or current profession. You can begin with nearly no start up costs, and work this business from your home full-time or part-time.
There are no licenses required to invest in Real Estate, in fact you may have previously done so by purchasing a home! Real estate presents a practically nonstop supply of properties. There are millions of properties in the market, and thousands more become available each day, all over the country and especially in Hyderabad.
As a Real Estate Investor at this time you have choices like never seen before. Some Real Estate Investors are talented enough to purchase properties of Hyderabad for less amount than what some current owners originally paid and many Real Estate Investors are purchasing more properties at this time. Also, Real Estate Investors are able to spend even less money on homes that need some type of reconstruction.
 

Forthcoming budget – too taxing? (Relax with some Humour)

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Do you feel too taxed with Forthcoming budget?
May be, But you can relax with some tax-free humour.
Q: What are you doing?
Ans.: Business.
Tax: PAY PROFESSIONAL TAX!
Q: What are you doing in Business?
Ans.: Selling the Goods.
Tax: PAY SALES TAX!!
Q.: From where are you getting Goods?
Ans.: From other States/Abroad
Tax: PAY CENTRAL SALES TAX, CUSTOM DUTY & OCTROI!
Q.: What are you getting by Selling Goods?
Ans.: Profit.
Tax: PAY INCOME TAX!
Q.: How do you distribute profit?
Ans: By way of dividends
Tax: Pay dividend distribution Tax
Q.: Where do you manufacture the Goods?
Ans.: Factory.
Tax: PAY EXCISE DUTY!
Q.: Do you have Office / Warehouse/ Factory?
Ans.: Yes
Tax: PAY MUNICIPAL & FIRE TAX!
Q.: Do you have Staff?
Ans.: Yes
Tax: PAY STAFF PROFESSIONAL TAX! Cool
Q.: Doing business in Millions?
Ans.: Yes
Tax: PAY TURNOVER TAX!
Ans: No
Tax: Then pay Minimum Alternate Tax
Q.: Are you taking out over 25,000 Cash from Bank?
Ans.: Yes, for Salary.
Tax: PAY CASH HANDLING TAX!
Q.: Where are you taking your client for Lunch & Dinner?
Ans.: Hotel
Tax: PAY FOOD & ENTERTAINMENT TAX!
Q.: Are you going Out of Station for Business?
Ans.: Yes
Tax: PAY FRINGE BENEFIT TAX!
Q.: Have you taken or given any Service/s?
Ans.: Yes
Tax: PAY SERVICE TAX!
Q.: How come you got such a Big Amount?
Ans.: Gift on birthday.
Tax: PAY GIFT TAX!
Q.: Do you have any Wealth?
Ans.: Yes
Tax: PAY WEALTH TAX!
Q.: To reduce Tension, for entertainment, where are you going?
Ans.: Cinema or Resort.
Tax: PAY ENTERTAINMENT TAX!
Q.: Have you purchased House?
Ans.: Yes
Tax: PAY STAMP DUTY & REGISTRATION FEE!
Q.: How you Travel?
Ans.: Bus
Tax: PAY SURCHARGE! Cool
Q.: Any Additional Tax?
Ans.: Yes
Tax: PAY EDUCATIONAL, ADDITIONAL EDUCATIONAL & SURCHARGE ON ALL THE CENTRAL Government’s TAX!!!
Q.: Delayed any time paying Any Tax?
Ans.: Yes
Tax: PAY INTEREST & PENALTY!

A common man: Can you let me die in peace now?
Ans: Yes. Just wait. We are about to launch the funeral tax!!!

Avoid Getting Your Income Tax Return Invalidated.

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As per the orders of the Supreme Court, it is now compulsory to file income tax return using the new prescribed forms ITR-8. Those who had filed their returns for A.Y. 2007-2008 in the form no. 2D i.e. SARAL form or any other old forms on or after 14th may, 2007 can re-file their returns in new proscribed forms ITR 1 to ITR 8 on or before 29th Feb, 2008 without being penalized.

New form has many benefits, such as:

  •        There is no need of attachments. 
  •         It helps IT department in data management for hassle-free tomorrow for you.
  •         Proper authentication of your returns.

Form ITR 1 is applicable to individuals having income from salary or pension or family pension or interest.

Form ITR 2 is applicable to individuals and HUFs not having income from business or profession.

Form ITR 3 is applicable to individuals/HUFs being partners in firms and not carrying out business or profession under any proprietorship.

Form ITR 4 is applicable to individuals and HUFs having income from a proprietary business or profession.

Form ITR 5 is applicable to firms, AOPs and BOIs.

Form ITR 6 is applicable to companies other than companies claiming exemption under section 11.

Form ITR 7 is applicable to persons including companies required to furnish return under section 139(4A) or Section 139(4B) or section 139(4C) or Section 139 (4D).

Form ITR 8 is applicable to return for fringe benefits.

Form ITR V is applicable to where the data of the return of income/ fringe benefits in form ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, ITR 7 and ITR 8 transmitted electronically without digital signature.

Acknowledgement form is applicable for e-Returns and non e-Returns.

For further information, please visit www.incometaxindia.gov.in or www.tin-nsdl.com

TIPS FOR PLANING TO BUY OR SELL HOUSE.

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If you are making your mind for  purchasing or selling a property, just watch. Property buying and selling needs a great sense of judgment-making and a Watchful planning at the investment stage itself could really avoid trouble and many sleepless nights.
The tips below are not comprehensive; though they will serve you as a check list to plan your deal in advance.

Before you buy a home gather adequate information about the property to make a deal smoothly :

Study: Read existing materials, talk to associates and specialists, and mess around looking at different homes, schools, and neighborhoods.
Sketch a Diagram: Spotlight on the vital factors and arrange the entire process. You may even want to use a folder with sections on house hunting, home financing, service providers, etc.
The exact location: It’s always better to search for a location that preferably is in line with your income and choice. Get an idea about the connectivity of the area to the fundamental needs of life – hospital, entertainment, shopping etc and the people living in the area.
Make a high-quality pact: Evaluate the cost of the property you are interested in with similar property in that area. A broker can be very helpful in this view as he can give you with the list of few transactions that has taken place in recent past in that area, which will give you a fair idea. A veteran agent is always a ideal option as he would be able to judge the area that will fit in your budget.
Closing costs: The closing cost includes costs incurred on brokerage, registration, stamp duty, insurance, property taxes, and amenities charges and so on.
Legal aspects: Before buying property, it is advisable to sign up a solicitor to inspect the original title documents of the property being purchased. If the title is not clear, the number of complications arising in future may be numerous.

Before you sell a home :
Keep in mind your house is the one potential buyer want to come back to for a second look.

Maintenance: Even small faults in your house might look big in the vigilant eyes of the buyers. Cleaning the external and internal area, giving the rooms a vivid look, creating speciousness and illuminating the house can make a huge difference in the prospective buyer’s mind.
Spreading the News:You can advertise in newspapers or on websites to sell your property. However, handling your own sale means you will be responsible for placing ads, answering phones and showing your home to visitors.
Real estate agents: The commission rate charged by an agent may differ, depending on where you reside or what agency you choose.
However there are some benefits of going through professional real estate agents. They will help you with:
• Establish a reasonable asking price for your home.
• Promote your home to other agents.
• Register your property in several listing services giving maximum spotligh.
• Schedule appointments to show your home to prospective buyers.
• Refer you to sources for insurance, inspections, legal counsel and financing.
• Help you negotiate with the buyer.
Setting a Fair Price:Some of the factors to consider in pricing your home are:
• Locality.
• Financial situations.
• Supply and demand in the local housing market.
• Extra features in your house, etc.
Qualifying a Buyer:
A number of factors will help determine the right buyer for your property:
• The buyer’s current earnings and service.
• The length of time the buyer needs before closing deals.
• How interested the buyer seems to be in your home w.r.t others.
 
 

TIPS FOR PLANING TO BUY OR SELL HOUSE

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If you are making your mind for  purchasing or selling a property, just watch. Property buying and selling needs a great sense of judgment-making and a Watchful planning at the investment stage itself could really avoid trouble and many sleepless nights.
The tips below are not comprehensive; though they will serve you as a check list to plan your deal in advance.

Before you buy a home gather adequate information about the property to make a deal smoothly :
Study: Read existing materials, talk to associates and specialists, and mess around looking at different homes, schools, and neighborhoods.
Sketch a Diagram: Spotlight on the vital factors and arrange the entire process. You may even want to use a folder with sections on house hunting, home financing, service providers, etc.
The exact location: It’s always better to search for a location that preferably is in line with your income and choice. Get an idea about the connectivity of the area to the fundamental needs of life – hospital, entertainment, shopping etc and the people living in the area.
Make a high-quality pact: Evaluate the cost of the property you are interested in with similar property in that area. A broker can be very helpful in this view as he can give you with the list of few transactions that has taken place in recent past in that area, which will give you a fair idea. A veteran agent is always a ideal option as he would be able to judge the area that will fit in your budget.
Closing costs: The closing cost includes costs incurred on brokerage, registration, stamp duty, insurance, property taxes, and amenities charges and so on.
Legal aspects: Before buying property, it is advisable to sign up a solicitor to inspect the original title documents of the property being purchased. If the title is not clear, the number of complications arising in future may be numerous.

Before you sell a home :
Keep in mind your house is the one potential buyer want to come back to for a second look.

Maintenance: Even small faults in your house might look big in the vigilant eyes of the buyers. Cleaning the external and internal area, giving the rooms a vivid look, creating speciousness and illuminating the house can make a huge difference in the prospective buyer’s mind.
Spreading the News:You can advertise in newspapers or on websites to sell your property. However, handling your own sale means you will be responsible for placing ads, answering phones and showing your home to visitors.
Real estate agents: The commission rate charged by an agent may differ, depending on where you reside or what agency you choose.
However there are some benefits of going through professional real estate agents. They will help you with:
• Establish a reasonable asking price for your home.
• Promote your home to other agents.
• Register your property in several listing services giving maximum spotligh.
• Schedule appointments to show your home to prospective buyers.
• Refer you to sources for insurance, inspections, legal counsel and financing.
• Help you negotiate with the buyer.
Setting a Fair Price:Some of the factors to consider in pricing your home are:
• Locality.
• Financial situations.
• Supply and demand in the local housing market.
• Extra features in your house, etc.
Qualifying a Buyer:
A number of factors will help determine the right buyer for your property:
• The buyer’s current earnings and service.
• The length of time the buyer needs before closing deals.
• How interested the buyer seems to be in your home w.r.t others.
 
 

RBI’s judgment has spooked real estate cos

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MUMBAI: The Reserve Bank of India’s (RBI) assessment not to slash interest rates has spooked real estate business facing the brunt of a housing business slowdown caused by the high cost of mortgage financing. RBI, on Tuesday, decided to keep interest rates unchanged in its third-quarter monetary policy review. Real estate companies were expecting a cut, especially in the background of slowing home sales in most important cities in the past few months.

”High interest rates are a serious concern as far as property market is concerned. There was some hope that the rates would be lowered today. However, the impact will depend upon the section and the demand-supply scenario there. The effect on Mumbai where the supply is limited will be minor,” Godrej Properties managing director Milind Korde said.

Buyer fighting and a sequence of interest rates hikes previous year put the brakes on home sales last year. Middle-class family put off purchases after considering prices break all records in most important metros. ET’s report, on Tuesday, cited RBI data to illustrate that home loan sales fell 39% in April-November 2007 while loans to developers eased by a fourth to Rs 12,563 cr.

Real estate shares fell after the policy. Lower rates help the real estate industry by spurring consumers into buying houses. Realty stocks like DLF, Puravankara Projects, Indiabulls Real Estate fell slightly at about 1%. The hardest hit were companies such as Unitech, HDIL and Omaxe whose shares fell down 5.59%, 5.47% and 2.12% respectively. Sobha Developers on the other side, closed at Rs 772.75, up 2.02% from the previous close.

“We were expecting at least a 25 basis point rate cut on Tuesday so that the feeling of possible home buyers turn positive, which in turn will help the developers to sell more residential units. The home sales are currently down now, but it doesn’t indicate that the developers will slash the prices,” said Director, Runwal group, Sandeep Runwal.

Jones Lang Lasalle Meghraj, chairman & country head, Anuj Puri said as the rate remain sluggish, high levels in interest rates will carry on and the impact will be felt mostly in the residential sector. This may also compel developers in some regions to sell their products at lower rates.

“Because of the subprime disaster in the US, US Fed (the Federal Open Market Committee) reduced the interest rates by 75 basis points. This naturally has created a wide gap between US and Indian interest rates, leading to arbitrage chances in the economy. US investors not only get the currency approval returns, but also higher interest income,” he said.

PAN Card And Its Benefit

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Permanent Account Number (PAN) card has been made essential for every transaction with the Income Tax department.   Now a days PAN card is mandatory for opening a bank account, for transaction of immovable properties, for foreign travel, for dealing in securities and for so many things. A PAN card also works as identification proof.

 
PAN card is used for identification. Some cases have come into light where a person avails more than one PAN card. In such cases, person should retain any one of them and should surrender the other through a letter addressed to jurisdictional assessing officer. It is illegal to have more than one PAN card and the penalty for this is Rs 10000. If a person has used different PAN for different purpose by mistake then he must surrender the additional card immediately and also he must have to inform the institution, where he has used that card, about the correct PAN.
 
Availing PAN does not mean that person have to file return. A person may avail PAN card even if he is not income tax payee. Return is to be filed only if the person has taxable income.