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April 6, 2000

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"Do I get any benefits if I have dependent parents?"

The Rediff Money Channel presents everything you wanted to know about tax issues, but didn't know whom to ask.

I am a salaried employee, I want to know the provisions for a senior citizen in the act. That is if I am eligible for senior citizen rebate. My date of birth is 20.08.1935 for the assessment year 2000 - 2001.

Balasubramanian

The provisions relating to senior citizens are contained in section 88B of the Income-tax Act. As per this section, any person who completes the age of 65 at any time during a financial year would be entitled to a rebate from the tax payable by him/her for that year and subsequent years.
In your case, you will complete 65 years in August, 2000. Hence, for the financial year ended 31st March, 2000 relevant to Assessment Year 2000-2001, you will not be entitled to the rebate for senior citizens. For the year ended 31st March, 2001, you will be entitled to the rebate which is to be computed as under:
100 per cent of the tax payable or Rs 15,000, whichever is lower.
Please note that the limit of Rs 15,000 is subject to the Finance Bill 2000 being passed by the Parliament. If this does not happen then the existing limit of Rs 10,000 would apply.

I have a handicapped child. For claiming the allowed deduction of Rs 40,000 (Under Section 80DD) towards maintenance of my child, do I have to produce the bills towards Medical, Training, etc. expenses?

The section 80DD does not lay down any requirement of submitting copies of the medical bills alongwith the return of Income. However, knowing the attitude of the officers of the Income-tax Department, it would be advisable for you to file copies of the bills alongwith the Return.
If you are a salaried person, then your employer can take into consideration this deduction while computing the TDS from your salary.
For this purpose, it would be sufficient to furhish to your employer a medical certificate from a government hospital and a declaration in writing by you certifying the amount of expenditure.

I am an army officer. My old parents have no income of their own and are dependent on me. Is there a provision for availing of some tax rebate for the money I send to them on a monthly basis?

Indrabalan

I am in the government service. My parents have no income whatsoever and are entirely dependent on me . Is there any provision for availing tax rebate on the money I send them

Ram Chandra

Regrettably, the Income-tax Act does not contain any section under which you would be able to get a tax rebate or deduction for the amount spent by you for taking care of your parents.

What was the prevailing interest rate on NSC VIII issue in February 1999? If possible, will you please provide the interest rates for the last three FYs?

Sajith Nallithodi

The table of interest on NSCs of face value Rs 10,000 (taken at this amount only for illustration) issued after 1-4-1989 but before 1-1-1999 is as under:
1st completed year: Rs 1,240
2nd completed year: Rs 1,390
3rd completed year: Rs 1,560
4th completed year: Rs 1,750
5th completed year: Rs 1,970
6th completed year: Rs 2,240
In case you have got NSCs of a value other than Rs 10,000, you may calculate the proportionate interest on the basis of the above table.

I am a central government servant (income tax payer), my father-in-law has gifted Rs 30,000 to my wife (who is a house wife). If she invests this amount in stocks, what will be her tax liability? Does her income get clubbed with mine?

Gangotia

Gift tax has been abolished with effect from October 1, 1998. Thus, for gifts made after this date, no gift tax is payable by anybody.
When your wife invests Rs. 30,000 (which has been gifted to her by her father) in stocks, there is no tax implication. However, when she sells the stocks, she will earn capital gains or loss as the case may be. Such a gain or loss would be included in her return of income for that year.
The dividend received by her on the shares would be exempt under section 10(33). There is no question of such income being clubbed with your income because the gift has not been given by you.

What is an appraisal report? Is it very serious matter?

Paresh Shah

When the Income Tax Department conducts a raid on anybody, the officer in charge of the raid has to prepare an Appraisal Report within 60 days and send it to the Officer under whose jurisdiction the raided tax-payer falls.
The appraisal report is a blue print for the Officer to complete the assessment of the raided person. The report is a confidential document and the tax-payer is not allowed to see it.
In the report, the Officer who drafts the report has to give guidance to the Officer who will be passing the actual assessment order for the year in which the raid has taken place.

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