| I had invested some money in mutual funds. How shall I show the dividend received from these mutual funds in my income tax return? If any mutual fund is sold within one year from the date of purchase, will the profit be treated as capital gains? Will the tax on capital gains be paid compulsorily? How shall I compute the capital gains tax? |
Saikat Khanra, Howrah |
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| ce you have income from sources other than salary and pension, you shall have to file your income return through Form ITR-2. Dividend income from mutual funds has been made tax-free in the hands of the unit holder. So, you won’t have to pay any tax on the dividend received from mutual fund schemes. However, you’ll have to show the total dividend received during the financial year in your tax return. There is a column E1 in ITR-2 where you’ll have to mention the exempted income, including the dividend income. For short-term capital gains, you’ll have to pay the tax at the rate of 15 per cent from the current financial year (earlier it was 10 per cent) on the profit made out of sale of units within one year of their purchase. |
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| Life’s like that |
| I have some life insurance policies and my mother is the nominee. I bought those policies before marriage. My wife is the nominee of those policies which I bought after marriage. Is it true that in the case of a married man, the wife is the sole legal heir. What is assignment of a policy? |
Dipankar Sarkar, Birbhum |
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| ation is an authorisation to receive the policy money after the death of the life assured. However, it does not give the nominee an absolute right over the money to the exclusion of other legal heirs. A nominee is only a custodian of the money, while its owner is the legal heir of the deceased person. In the case of a married man, his wife is the legal heir. Assignment of a life insurance policy means the act of transferring the rights of property in the policy from one person to another. The person who transfers the right is the assignor and the person to whom the right is transferred is the assignee. A policy holder can send the insurer a request for an assignment by completing the following documents and submitting them to the nearest branch: a) assignment form duly filled and signed by assignor, assignee and witnessed, and b) original policy bond. |
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| If you have any queries about investing or taxes or a high-cost purchase you are planning, mail to: btgraph@abpmail.com, or write to: Business Telegraph, 6 Prafulla Sarkar Street, Calcutta 700 001. |
