Q. I left India in January 1994 and have been an NRI since then. I bought a flat in 1997 in Mumbai, in joint ownership with my wife, from the funds earned outside India and the money was remitted through the bank. I have let out the flat and earning Rs 2,40,000/- per annum as rent, which I presume can be repatriated. Will this amount be taxable along with my other interest income in India, if the amount is retained in India and not repatriated. Or will it be tax-free if repatriated outside India ?
N.S. MURTHY via email
A. You shall be liable to pay tax on the rental income and the interest income in India, irrespective of the fact that the amount is repatriated or not. A non-resident is liable to pay tax on all incomes accruing or arising in India or deemed to accrue or arise in India. You shall however be eligible to claim the admissible deductions as per the provisions of the Income-Tax Act.
Q. I am a student of Chartered Accountancy PE II course with a merit background in my CA PE I. I require your clarification with regard to the educational loan available to the students from various nationalised banks: n Whether any educational loan can be obtained from banks to pursue my professional education? I have no source of income other than the stipend paid by my principal?
n Whether the loan so taken can be utilised for the purchase of vehicle?
K. KARTIC Hyderabad
A. Deduction in respect of interest on loan taken for higher education is governed by the provision of Section 80E. "Higher Education" means full-time studies for graduate or postgraduate course in engineering, medicine, management or postgraduate course in applied sciences or pure sciences including mathematics and statistics. Deduction under Section 80E will not be available for instance, for courses in humanities, social sciences, commerce, accountancy or law [Vide Circular No 684]. Hence, you will not be eligible for any deduction under Section 80 E of the Income-Tax Act, 1961. As far as vehicle loan is concerned, you may approach banks that offer these loans.
Kamal Rathi represents Rathi & Malani, a Hyderabad-based chartered accountancy firm. The views expressed here are those of the author. They do not reflect the views of this newspaper. Readers can send their personal income-tax queries to Mr Rathi at tax@decca-nmail.com, or write him at Tax Matters, C/o Deccan Chronicle, 36, Sarojini Devi Road, Secunderabad-500003, AP
N.S. MURTHY via email
A. You shall be liable to pay tax on the rental income and the interest income in India, irrespective of the fact that the amount is repatriated or not. A non-resident is liable to pay tax on all incomes accruing or arising in India or deemed to accrue or arise in India. You shall however be eligible to claim the admissible deductions as per the provisions of the Income-Tax Act.
Q. I am a student of Chartered Accountancy PE II course with a merit background in my CA PE I. I require your clarification with regard to the educational loan available to the students from various nationalised banks: n Whether any educational loan can be obtained from banks to pursue my professional education? I have no source of income other than the stipend paid by my principal?
n Whether the loan so taken can be utilised for the purchase of vehicle?
K. KARTIC Hyderabad
A. Deduction in respect of interest on loan taken for higher education is governed by the provision of Section 80E. "Higher Education" means full-time studies for graduate or postgraduate course in engineering, medicine, management or postgraduate course in applied sciences or pure sciences including mathematics and statistics. Deduction under Section 80E will not be available for instance, for courses in humanities, social sciences, commerce, accountancy or law [Vide Circular No 684]. Hence, you will not be eligible for any deduction under Section 80 E of the Income-Tax Act, 1961. As far as vehicle loan is concerned, you may approach banks that offer these loans.
Kamal Rathi represents Rathi & Malani, a Hyderabad-based chartered accountancy firm. The views expressed here are those of the author. They do not reflect the views of this newspaper. Readers can send their personal income-tax queries to Mr Rathi at tax@decca-nmail.com, or write him at Tax Matters, C/o Deccan Chronicle, 36, Sarojini Devi Road, Secunderabad-500003, AP