Saturday, May 26, 2018

Things to know before investing in long term debt funds

Long term debt funds invest in bonds with very long expiry periods. This period can be as long as 10 years. Most of the long term debt fund investment goes into government bonds.

Holdings of one of the famous long term debt fund : ICICI pru long term fund : http://www.moneycontrol.com/mutual-funds/icici-prudential-long-term-plan-direct-plan/portfolio-holdings/MPI2285

Long term debt fund can go up and down depending upon the yields of these bonds.

The net asset value of any long term debt fund will fall when yield of these 10 year government bond rise. These bonds are traded in bond market and can rise and fall due to variety of reasons:

1) Market sentiments: If inflation is rising or macro data are not coming out good. These bonds will grow attract higher yield and as a result your long term debt fund NAV will fall.

2) RBI policy: Any hike in monetary ratios(repo rate etc) will again increase the yield of 10 year bond yield and decrease ong term debt fund NAV.

To check the present and past yield of 10 year bond refer :   https://www.bloomberg.com/quote/GIND10YR:IND  

Lessons from "Rich Dad Poor Dad"

I recently finished reading "Rich Dad Poor Dad" by Robert Kiyosaki.
It is a great book to read if you are a teenager or just starting your career.

Robert emphasized on following life principles in his book :

1) Don't blame your employer/job for your miseries. The problem as well as the solution lies within you.

2) Always focus on learning new skills.

3) Money is not that important initially in your career, learning is.

4) Always focus on building assets. Get the assets which can generate cashflow for you.

5) Rich people get richer because their money works for them. Poor people work for money.

6) Invest Invest Invest.

7) A stable job will not make you rich. You get rich by investing in income generating assets.

8) Save yourself from income tax whenever possible.

9) Always keep your accountant/broker/lawyer happy.

10) Surround yourself with intelligent people. 

11) Keep on learning throughout your life.

Saturday, May 19, 2018

HOW TO REPLY FOR INCOME TAX NOTICE U/S 143(1)(a).


HOW TO REPLY FOR INCOME TAX NOTICE U/S 143(1)(a).


If you have received email form "intimations@cpc.gov.in" with subject "Communication from CPC for the PAN xxxxxxxxxx and A.Y.2017-18" saying :

Your return for AY 2017-18 bearing Ack. No. xxxxxxxxxx was taken up for processing and on verification it was found that it contains arithmetical errors/ incorrect claims/ inconsistencies with respect to Audit Report /Form 26AS and the same is indicated in the table annexed.
 
2. You are required to provide your response to this communication by electronic mode using your account on the e-filing website, wherein a link has been enabled showing the pending actions. If you agree with the differences indicated in the table annexed, a) either fully, or b) partially,

You may exercise your option of filing a revised return, so that the omissions in the return of income can be completely taken care of within the meaning of section 139(5).
 
3. However, you have also been afforded a facility in the e-filing portal to state the extent to which you are in agreement with the difference as indicated in the table. For the disagreed portion, please provide the amount and the reason for such disagreement.
 
Then do not worry here is a simple step by step process to reply for this kind of notice.


1. Go to http://incometaxindiaefiling.gov.in

2. Click on e-Proceedings:


3. Click on proceeding name :


4. Click on Submit link under Response header:


5. You will get 3 options “Agree”/”Partially Agree”/”Disagree”:


6. If you click “Agree”/”Partially Agree” you will have to file revised ITR and give acknowledgement number here.

7. If you click “disagree” you are given below form: 


8. Enter the reason and amount for discrepancy:



9. Make sure net tax payable is 0 else you have to file revised ITR. Click Submit.