Queries
vardhan , Kothagudem
There is LTCG tax on equity funds now . Is it necessary to wait for a year to redeem or switch such funds ? The Finance Act 2018 has imposed a tax on long term capital gains on equity-oriented mutual funds , which are transferred after one year from the date of purchase at 10 per cent ( plus surcharge and cess , if applicable ). You can sell / redeem funds after one year from the date of acquisition . The market value of the fund as on 31 January 2018 can be substituted for the cost and further no tax shall be levied up to a gain of `1,00,000 during the year . However , if you redeem / switch the fund before one year , then any gain made shall be chargeable to tax at 15 per cent You will not get benefit of substitution of the cost and exemption of `1,00,000 which are only available to funds held for more than one year . Hence , you should wait for a year from the date of acquisition to redeem / switch such funds . Otherwise you may end up incurring additional tax liability .
Ashok Shah Partner
N A Shah Associates LLP
Hema , Bhavnagar
I am 80 year old and I want to freeze my demat account . Who can unfreeze it after my death ? Why do you want to freeze the account ? In that case , no one can operate it without your signature . Have you updated a nominee in your account ? Have you made your will ? If not , please do that first . Your legal heir or nominee can unfreeze , operate , sell or transfer the stocks in their account by presenting a death certificate with a proper transfer form .
HINA SHAH Certfied Financial Planner & Founder ,
Luhem Comprehensive Financial Plannersi
Sanjay Bari , Shirpur
Can you please suggest the best pension plan . I am 48- years-old . I am working in a private educational institute . Pension depends on few things like at what age you are planning to retire . 58 or 60 is retirement age in government organisations . What is your current lifestyle ? What is your current monthly expenses ? What do you want to do after retirement ? Quantifying your requirements in today ’ s term and then you can estimate future requirement after taking into consideration inflation . You can visit websites where you can calculate this value .
Then you can think of the asset class in which you are comfortable - balance mutual funds , debt funds etc , where you can invest and get good returns . If you are not comfortable with equity mutual funds , you can invest some part in pension plans where you get fixed returns .
You can choose a pension plan with
■ Annuity for life time + return of purchase price
■ Annuity for 15 to 20 years option ( you get little higher amount as it is for a short term )
■ Some companies also offers annuity + spouse annuity + return of purchase price . You can choose from what age you want pension . There is an option where if you are not satisfied with your company as you pay your premiums , then at the time of retirement , six months before the annuity starts , you can choose to opt out and go with another company .
Pensions are taxable and considered as income at a given tax rate , but you have to produce living certificate ( proof of being alive ) to the authorities .
HINA SHAH Certified Financial Planner & Founder ,
Luhem Comprehensive Financial Planner
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Outlook Money June 2018 www . outlookmoney . com