Have You Disclosed Other Source of Incomes?

The due date for filing personal income-tax returns for the financial year 2012-13 is 31^st July 2013.

There are a few more sources of income which one MUST disclose. The disclosure can be done either to our employer (so that they are taken care of in Form 16) or while filing our returns.

Some of the very important disclosures are:

1	Interest earned from Savings Bank Account	Interest earned from savings account is tax free up to Rs 10,000/-. Any interest earned above that is taxable and should be declared.
2	Interest earned from Fixed Deposits	Interest received from fixed deposits is taxable as per ones income tax slab. Most of the times banks deduct 10% TDS when the interest accrued is more than Rs 10,000/- (unless one submits a Form 15 G/H). However, the actual tax liability will be more or less, depending upon the tax bracket one falls under after all incomes and deductions are claimed.
3	Interest earned from Recurring Deposits	Interest received from recurring deposits is taxable as per one’s income tax slab. Banks do not cut any TDS on interest earned on recurring deposits and hence it becomes even more important to declare this source of income.
4	Interest earned on Postal deposits and National Savings Certificates (NSCs)	Interest earned on Postal deposits and National Savings Certificates (NSCs) is taxable and needs to be declared.
5	Cash Gifts	Cash gifts received for more than Rs 50,000/- should be declared as they are taxable (unless for specific occasions like marriage, will etc)
6	Capital Gains/Losses	Any Capital gains/losses made from trading equities, selling mutual funds, gold etc should be declared even though they may be non-taxable (e.g. for equities long term capital tax is NIL). Similarly, any losses should be declared as these help in offsetting gains for subsequent years
7	Exempt Income	Exempt Income (e.g. Interest earned on PPF/EPF accounts) should be declared for auditing purposes only. This is a tax free income
8	Dividend Income	Dividend income is tax free in the hands of the investor. However this should be declared while filing income tax returns

Do's and Dont's Before Choosing Your Broker

DO'S

• Always deal with the market intermediaries registered with SEBI / Exchanges
• Give clear and unambiguous instructions to your broker / agent / depository participant
• Always insist on contract notes from your broker. In case of doubt of the transactions, verify the genuineness of the same on the Exchange website.
• Always settle the dues through the normal banking channels with the market intermediaries
• Before placing an order with the market intermediaries please check about the credentials of the companies, its management, its fundamental a recent announcements made by them and various other disclosures made under various regulations. The sources of information are the websites Exchanges and companies, databases of data vendor, business magazines etc.
• Adopt trading/ investment strategies commensurate with your risk bearing capacity as all investments carry risk, the degree of which vary according to the investment strategy adopted.
• Please carry out due -diligence before registering as client with any intermediary. Further, the investors are requested to carefully read and understand the contents stated in the Risk Disclosure Document, which forms part of investor registration requirement for dealing through brokers in Stock market.
• Be cautions about stocks, which show a sudden spurt in price or trading activity, especially low price stocks.
• Please be informed that there are no guaranteed returns on investment in stock markets.

DONT'S

• Don’t deal with unregistered brokers / sub-brokers, intermediaries
• Don’t deal based on rumors generally called 'tips'
• Don’t fall prey to promises of guaranteed returns.
• Don’t get misled by companies showing approvals / registrations from Government agencies as the approvals could be for certain other purposes a not for the securities you are buying.
• Don’t leave the custody of your Demat Transaction slip book in the hands of any intermediary
• Don’t blindly follow media reports on corporate developments, as they could be misleading.
• Don’t get carried away with onslaught of advertisements about the financial performance of companies in print and electronic media.
• Don’t blindly imitate investment decisions of others who may have profited from their investment decisions