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Use Form 15G/H to avoid TDS on dividend

As DDT is abolished, dividend income from shares and mutual funds are now taxable in the hands of investors from April 1, 2020. If investor’s net taxable income is within the exempted limit, one can submit form 15G or 15H at the earliest in order to avoid the tax levied.

Form 15G: An individual needs to satisfy the following points in order to be eligible to submit this form.

· You must be a Resident Individual.
· You should be less than 60 years of age i.e. not a senior citizen.
· Total dividend income to be received in the financial year should be less than the exemption limit of ₹2.5 lacs.
· You should have NO tax liablity for the financial year.

Form 15H: A senior citizen (above 60 years of age) can submit this form if there is NO estimated tax payable on his total income for the financial year.

Stamp-duty

In adherence to the amendments carried out in the Indian Stamp Act in February 2019, stamp-duty is required to be paid for issue and transfer of Mutual Fund units with effect from 1 July 2020. Stamp Duty of 0.005% is imposed on any type of purchase (fresh, additional, SIP, STP, switch, dividend reinvestment) either it in open-ended or close-ended or any SIP instalment. If there is a purchase of Rs. 1 Lakh, then the duty will be Rs.5.

Change in cut-off time for Mutual Funds

As per SEBI's communication, the revised cut-off timings for MF transactions are 1.00 p.m.. It is 12.30 p.m. for liquid and overnight funds. It has been effective from 7th April'2020 till further notice.

Health Insurance- an urgent need

There is an urgent need to rethink and recalculate health insurance cover required for entire family. Ask these questions to yourself about your health insurance-

Am I only on the health insurance provided by my employer?
Do I have standalone health insurance policy?
Is my health insurance cover sufficient to face Covid-19?

NACH forms to replace ECS forms of SIP

From May 1, only National Automated Clearing House (NACH) mandate forms would be accepted for SIP. NACH form has replaced ECS forms of SIP.

NACH was supposed to be implemented from March 1 but National Payments Corporation of India (NPCI) at the behest of AMFI extended this deadline to May 1. NPCI is an umbrella organization for all retail payments system in India.

Please note that existing ECS mandates would continue to be operative till the validity of the mandate. So existing investors needn’t to do anything in this respect.

As of now, registering a SIP through ECS mandate takes up to 30-35 days. With NACH, the turnaround is expected to reduce to only up to 10 days as banks have to answer within T+5 days to confirm the transaction.

NACH can help investors in a big way. Earlier, investors had to register multiple mandates if they wanted to invest through SIP in more than one scheme. With the new system, investors can register more than one SIP through one mandate.

FATCA

The Foreign Account Tax Compliance Act (FATCA) was passed in 2010 by the United States government. FATCA targets tax non-compliance by U.S. taxpayers with foreign accounts.

FATCA focuses on reporting:
	By U.S. taxpayers about certain foreign financial accounts and offshore assets By foreign financial institutions about financial accounts held by U.S. taxpayers or foreign entities in which U.S. taxpayers hold a substantial ownership interest
	Also, SEBI had vide its circular no. CIR/MIRSD/2/2013 dated January 24, 2013 prescribed guidelines regarding identification of Ultimate Beneficial Owner(s) (‘UBO’) for Entities. As per these guidelines UBO means ‘Natural Person’, or persons who ultimately own, control or influence a client and/or persons on whose behalf a transaction is being conducted, and includes a person who exercises ultimate effective control over a legal person or arrangement. Investors are requested to refer to the ‘Declaration for UBO’ for detailed guidelines on identification of UBO. It is very easy to submit FATCA details online.

KYC Requirements

AMFI has recently issued a circular amending the KYC requirements for Mutual Fund customers. Accordingly, no subscriptions in any form (including switches) would be accepted without completion of said additional KYC requirements. Investors may require to submit necessary documents if their KYC are not in 'Registered' or 'Complete' status. Investors have to complete the KYC requirements latest by Octoner 31, 2015.

Lifestyle Diseases

Lifestyle diseases such as hypertension, diabetes, heart-related ailments etc are affecting Indians at a young age. According to a 2015 WHO finding, about 16 million people die prematurely every year, owing to wrong lifestyle choices. Medical advancements, improved healthcare facilities and greater awareness about basic sanitation and hygiene have lowered or eradicated communicable diseases such as polio, cholera, tuberculosis, etc. in India. According to WHO, today, the chances of an Indian dying due to a non-communicable disease is twice compared to succumbing to a communicable disease. What is more alarming is that just about 10 years ago, the probability of either case was equal!

With lifestyle changes, increase in sedentary jobs, shift-based roles, greater commuting time, etc. today’s youth become victims of irregular eating and sleeping habits. They are also prone to stress, juggling between multiple tasks on a regular day. Similarly as we get affluent our stress levels go up, which leads to poor sleep and lack of good lifestyle. We must never forget that physical activity has to be a way of life. Please take care of yourself and follow a disciplined routine.