NRIs & Taxes Don’t Get Caught Out! Your Guide to Filing ITR

Navigating the Indian tax system as a Non-Resident Indian (NRI) might feel overwhelming, but don’t worry—we’re here to help make it easier for you! Understanding your Income Tax Return (ITR) filing requirements is essential to avoid penalties and ensure your financial journey is smooth and hassle-free.

When Do You Need to File an ITR?
You generally don’t need to file an ITR if you have no income sourced from India. However, it becomes mandatory if your total Indian income in a financial year exceeds:

₹2.5 lakhs under the old tax regime.

₹3 lakhs if you opt for the new tax regime.

Even if your income is below these thresholds, filing might still be necessary if you have specific types of income, such as:

Rental income from Indian property.
Pension received in India.
Capital gains from selling Indian assets.

Benefits of Voluntary Filing: Even if your income falls below the threshold, consider filing an ITR voluntarily. This can be beneficial for:

Claiming tax refunds on deducted TDS (Tax Deducted at Source).
Claiming DTAA benefits in India.
Carrying forward capital losses to offset future gains.
Securing bank loans or visas where ITRs are required.

Choosing the Right ITR Form: You shall select ITR-2 for returns filing, and for business income, ITR 3 is required. NRIs can no longer file ITR-1. Consulting a tax advisor can ensure you choose the correct form. The deadline for ITR filing is usually July 31^st of each year. Missing this deadline can attract penalties.

Remember:
By staying informed and proactive about your tax obligations, you can enjoy peace of mind and focus on your financial goals. If you have any questions or need assistance, we’re here to guide you every step of the way!

(Contributed by Yogesh Gola, Relationship Manager, Advisory Desk, Hum Fauji Initiatives)

The Rise of Social Media Investment Scams.
How to Avoid them?

With the stock market on the rise, many first-time investors are drawn by the promise of higher profits. However, this surge in interest has also opened the door to scammers lurking on platforms like WhatsApp and Telegram, ready to exploit unsuspecting investors. Of course, investors themselves must shoulder some responsibility also for getting drawn to it in their quest for quick gains.

In a booming market, the fear of missing out (FOMO) grips many investors, prompting them to question if they’ve missed their chance. But it’s crucial to consider whether chasing after quick gains aligns with their long-term investment strategy.

Here are some common pitfalls to avoid when navigating the complex world of stocks and investments:

High Return Promises: Beware of schemes offering sky-high returns with no mention of risks. Real investments always come with some risk. Stick to reputable companies with clear and transparent operations. Remember, if it is too good to be true, it most probably isn’t true!
Phone and Online Solicitations: Be cautious of unsolicited tips via SMS, email, or social media promoting certain stocks. These can be part of “pump-and-dump” schemes, where fraudsters inflate stock prices with false information before selling their shares, leaving you with losses.
WhatsApp and Telegram Groups: Fraudsters frequently establish groups on these messaging platforms, posing as knowledgeable market insiders. They manipulate discussions to persuade group members, often using fabricated claims of insider knowledge or guaranteed profits. Investors should exercise caution before participating in such groups and avoid making investment decisions based solely on group recommendations.
Urgency and Aggressive Sales Tactics: Scammers use aggressive tactics to create a sense of urgency, pressuring you to invest quickly. Real investment opportunities don’t rely on fear or rushed decisions. Take your time to research and consider your options.

While the promise of high returns is tempting, it’s essential to approach the stock market with caution. Protect yourself by avoiding common scams, doing thorough research, and seeking advice from reliable sources. Stay informed and vigilant to ensure your investment journey is safe and successful. If you need any assistance, we’re here to help you navigate the complex world of investments!

(Contributed by Ujjwal Dubey, Financial Planner, HNI Desk, Hum Fauji Initiatives)

Planning for a Second Career Post-Retirement

Retirement can be a thrilling yet uncertain time as you transition from a long-standing career to a new phase of life. While some retirees enjoy their newfound free time, others seek opportunities to start a second career. Leveraging your skills and experience can provide financial benefits and a renewed sense of purpose and fulfilment.

Here are some key considerations to help you navigate this exciting phase of life.
Assess Your Financial Needs

Review Savings: Check your EPF, PPF, pension, and other investments.
Estimate Expenses: Include essentials like housing, healthcare, and daily costs.
Identify Income Gaps: Determine if you need extra income to cover your expenses.

Explore Career Options

Leverage Experience: Use your professional background. Consider consulting, part-time, or freelance work in your previous field.
Pursue Passions: Turn hobbies or interests into work. Think about teaching, writing, or working with NGOs.
Seek Flexibility: Look for part-time, remote, or freelance opportunities to maintain work-life balance.

Consult Advisors

Financial Advisors: Seek advice on managing retirement funds, tax planning, and investment strategies.
Career Counsellors: Get guidance on suitable career paths, skill development, and job search strategies.

Balance Work and Personal Fulfilment

Set Goals: Define what success means to you—financial stability, personal growth, or community impact.
Prioritize Well-being: Ensure your new career leaves time for family, self-care, and leisure.
Stay Adaptable: Be flexible and ready to adjust your plans as needed.

Planning a second career post-retirement involves assessing financial needs, exploring career options, consulting advisors, and balancing work with personal fulfilment. With careful planning, you can achieve both financial stability and personal satisfaction in this new chapter.

(Contributed by Neeraj Kumar, Financial Planner, Team Arjun, Hum Fauji Initiatives)

What Did Our Clients Ask Us in the Last 7 Days?

Question: How do I correct discrepancies in my Annual Information Statement (AIS)?

Our Reply: The Annual Information Statement (AIS) includes current data from the Income Tax Department. There may be other transactions relating to the taxpayer which are not presently displayed in Annual Information Statement (AIS). Taxpayer should verify all details and report accurate information in the Income Tax Return to avoid complications.
Here’s how to correct any discrepancies before filing your ITR:

Review the AIS: Carefully go through the AIS to identify any discrepancies or incorrect entries.
Gather Supporting Documents: Collect all relevant documents such as bank statements, transaction receipts, and any other evidence that supports the correct information.
Access the Income Tax Portal:
- Log in to the Income Tax e-filing portal: Income Tax Portal
- Navigate to the ‘AIS’ section under the ‘Services’ tab.
Submit a Correction Request:
- Select the specific entry that needs correction.
- Provide the correct details along with supporting documents.
- Submit your correction request through the portal.
Follow Up: Keep track of the status of your correction request through the portal. If needed, follow up with the Income Tax Department.
Respond to Any Notices: If the Income Tax Department issues any notices regarding the discrepancies, respond promptly with the necessary information and documents.

By following these steps, you can ensure your AIS is accurate, avoiding complications during your tax filing process. Happy filing!

(Contributed by Team Arjun, Hum Fauji Initiatives)