On owning a second house, our taxpert says there is an option that will keep the taxman from knocking on your door.

The plus and possible minuses of owning a second or third housing property, from tax avoidance point of view

G Balasubramanian on exemptions and benefits under the Income-Tax Act for various housing loans

We received a call from our reader, Mr Kumar, recently. He was very agitated and wanted to speak to our Taxpert immediately! We tried to ask him for details, but he was adamant on getting the query solved by our Taxpert. Fortunately, as he was in Mumbai, he could meet our Taxpert, Mr G Balasubramanian, and sort out the matter to his satisfaction.

Insurance Agents tell me that the peak season for insurance selling is January to March. Season’s Greetings and Happy Selling!
In this Issue, I shall take up selling policies under the Married Women’s Property Act, 1874 (MWP Act).
‘Why is this topic appearing in the Taxpertise column?’ would be an obvious question.

We continue Taxpertise this month with more on families. We read a lot about financial planning today, especially retirement planning. One of the reasons this has become important is the breakdown of the traditional Hindu joint family system that provided social security.
That may be so but there is something called the Hindu Undivided Family (HUF) that is alive and well. It is not really a social or even emotional unit, though it could well be so. It is a legal structure used mainly for tax planning purposes!

A person can have an income of more than Rs 25 lakh without paying any tax. Wondering how? That is what the author calls the Magic of Family Tax Planning.
We saw how gifts can be a tool for tax planning earlier. This month we examine in detail how considering the family as a unit helps in tax planning.

It’s festival season in India! A season that starts around August and goes all the way till January of the next calendar year. The season never ends.
Festivals mean gifts. Sweets and new clothes apart, money is the ultimate gift! This month in Taxpertise we will see what tax has to do with gifts!
‘I want to give a gift/ I am going to receive a gift. I want to know about tax on gifts. Can you tell me what the advantages or disadvantages are?’
This question comes up many a time when I advise my clients. Just as there are sections of the Income-tax Act, 1961 that give gifts to the tax-payer by reducing his tax, there is also a section that taxes gifts!

It is called enlightened self-interest. It means doing something that helps others because it will anyway result in something that will help us. Enlightened self-interest is what the Government shows when it gives away gifts in the form of tax deductions and rebates.
Due to the attraction of lower tax, we choose to put our money into certain types of investments which the Government wants us to choose. What the Government achieves when we make this choice is that it gets funds for activities that it has identified as priorities.
We saw how Section 80 C of the Income-tax Act, 1961 gives a gift of Rs 30,900 to any individual taxpayer who wants it. (Taxpertise, Premium, August, 2010, Page 16). All the investments that Section 80 C encourages are chosen with these objectives in mind.

Readers wrote in with questions about Section 80 C of the Income-tax Act, 1961 and so, this month’s Taxpertise column takes a detailed look at the section that gives a Rs 30,900 gift to the taxpayer!