Category: Personal Finance

From Filing Belated ITR To TDS Payment: Check New Timelines Here

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Taxes

oi-Vipul Das

|

During the Covid-19 second wave, the Income Tax Department recently extended certain deadlines to relieve taxpayers of the strain of multiple income tax compliance, including the submission of belated or revised returns for the 2019-20 fiscal year, until May 31. According to CBDT, the filing of a belated return under Section 139 of the Act, as well as a revised return under Section 139 of the Act, for Assessment Year 2020-21, which was due on or before March 31, 2021, may be filed on or before May 31, 2021. Hence, below is a complete list of new deadlines that taxpayers should be aware of:

From Filing Belated ITR To TDS Payment: Check New Timelines Here

Submission of belated ITR

According to the CBDT, the filing of a belated return under sub-section (4) and a revised return under sub-section (5) of Section 139 of the Income-tax Act, 1961 for Assessment Year 2020-21, which was due on or before March 31, 2021, can now be conducted on or before May 31, 2021.

TDS payment under various sections

Payment of TDS under Sections 194-IA, 194-IB, and 194M of the Income-tax Act, 1961, as well as the filing of challan-cum-statement for tax deducted, which were due on April 30, 2021, can now be completed and submitted on or before May 31, 2021.

ITR in relation to the Section 148 notice

According to the CBDT, the ITR filed in relation to a notice under Section 148 of the Income-tax Act, 1961, with a due date of 1st April 2021 or later, can now be filed within the period allowed under the notice or by 31st May 2021, whichever is later.

Submission of statement in Form 61

According to CBDT, the statement in Form No. 61, containing details of declarations submitted in Form No.60, which was due on or before April 30, 2021, must be filed on or before May 31, 2021.

Filling of appeals

According to CBDT, an appeal to the Commissioner (Appeals) under Chapter XX of the Income-tax Act, 1961, must be filed within the period specified in that Section or by May 31, 2021, whichever is later. Even, under Section 144C of the Income-tax Act, 1961, appeals to the Dispute Resolution Panel (DRP) can be submitted within the time limits set out in that section, or by May 31, 2021, whichever comes first.

Vivad se Vishwas scheme

According to the CBDT, the deadline for payment the amount due under the Direct Tax Vivad se Vishwas Act, 2020, without any additional amount, has been extended until June 30, 2021.

The Central Government has also agreed to extend time restrictions to June 30, 2021 in the following circumstances where deadlines were previously extended to April 30, 2021 by multiple regulations provided under the Taxation and Other Laws (Relaxation) and Amendment of Certain Provisions Act, 2020:

  • Time period for issuing any order for assessment or reassessment under the Income-tax Act, 1961 (hereinafter referred to as “the Act”), the deadline for which is set out in sections 153 or 153B.
  • Timeframe for issuing an order in response to a DRP’s guidance under sub-section (13) of section 144C of the Act.
  • Timespan for issuing a notice under section 148 of the Act to reopen an assessment where income has been missed.
  • Deadline for submitting intimation of Equalisation Levy processing under sub-section (1) of section 168 of the Finance Act 2016.



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Check Conditions To Claim Fixed Deposits In Case Of Death Of The Deposit Holder

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Single FD account with and without nomination

In case a depositor have an FD account individually or in a single name with a nomination, then the designated nominee can only seek the FD amount upon the depositor’s death by providing the depositor’s death certificate and proof of identity. If there is no nomination, the depositor’s family members must file a succession certificate, as well as the depositor’s death certificate, to claim the funds. The bank will request a legitimate heir certificate if there is succession certificate and the money will be divided equally among all legitimate heirs.

In case of Joint Accounts

In case of Joint Accounts

If the depositor have a joint account, the claim process will be determined by the category of joint account, which includes “Either or Survivor,” “Anyone or Survivors,” “Former or Survivor,” “Latter or Survivor”, “Jointly” and “Jointly or Survivor”.

“Either or Survivor”

This account can only be operated by two individuals: the primary account holder and the secondary account holder. On the death of any of the account holders, the total balance and interest (if any) will be paid to the survivor. The account can be continued by the survivor. And if the account has a nomination, the funds will go to the survivor. And if both account holders die then the nominee will be allowed to claim the amount. The maturity proceeds will be divided among the legitimate heirs of both depositors in case both the account holders die and there is no nominee.

“Anyone or Survivor”

This is close to the above-mentioned joint account. In this case, though, the account can be operated by more than two individual persons. All in the family members can manage this kind of joint account. In case of death of one or more account holders and if there are more than two individuals named on the FD, the bank will reimburse the total balance and interest to the survivors. The nominee will receive the funds until all depositors die. If no nomination is made, the fund will be transferred to the legitimate heirs of the late depositor and the surviving deposit holders upon the death of one or more depositors. The proceeds will be distributed to the legitimate heirs of all depositors upon their death.

“Former or Survivor”

Only the primary account holder can access and manage this form of joint account until hos or her demise. Only after the primary account holder has expired the second account holder can run the account and withdraw funds. The second account holder will be required to file the first account holder’s death certificate to claim the funds. The eligible nominee will be allowed to withdraw funds on n the death of both holders. The money will be allocated to the legitimate heirs of all depositors if there is no designated nominee and all depositors die.

“Latter or Survivor”

This works in the same way as the “former/survivor” account. The distinguishing factor is that only the second account holder can manage the account until he or she dies. Only after the death of the secondary account holder, the primary account holder (first account holder) can manage the account and withdraw funds accordingly. When all depositors die, the principal amount, plus any interest, will be paid to the nominee. If there is no nominee and all account holders die, the money will go to the legitimate heirs of the holders.

“Jointly”

All transactions in this type of account must be approved and confirmed by all account holders. The account will be become inactive if any of the account holders dies and the maturity proceeds will be paid to the survivor.

“Jointly or Survivor”

This is identical to the above discussed option “jointly.” The main distinction is that the account can be operated by the survivor. Conversely, the account’s proceeds will be provided to him or her.

Note

Note

In addition to the above alternatives, there is a type known as a “Minor Account.” An adult guardian can be added as a joint account holder if the primary account holder is under the age of 18 years old. If the mode of service is “either or survivor” or “jointly,” all current account holders must sign the application form which is an important point to note here. According to the RBI guidelines, deposit accounts under which a valid nomination is available and opened under the survivor provision i.e. either or survivor or former or survivor or anyone or survivor or latter of survivor; the payment to the survivor(s)/nominee of the deposit account is a valid release of the liability of the bank provided once it has been adequately looked after, and cautioned in the deposit account.

Such bank payments to the survivor(s)/nominee does not impact any person’s right or claim against the survivors. Banks should not rely on presenting the legal representation/succession certificate/letter of administration or probate, etc. In the event of accounts without the survivor/nominee provision, banks may set a minimum balance threshold in the deceased account for which claims are to be settled and without requiring any documents other than the indemnity letter. The banks may follow the same procedure for the deposit accounts in order to access the contents of the locker/safe custody article concerning the death of the locker holder/article depositor.

The repayment of claims and disbursement payments to survivors / nominees is approved by the banks for payment within a span of not more than 15 days after the date on which the claim has been received subject to a proof of the death of the depositor and appropriate acknowledgement of the claim(s). In the case of missing persons, claims can be addressed on the grounds of presumption of death, which can be addressed only after a period of seven years has passed after the person was declared missing to a competent court and the court presumes the individual is dead under Section 107/108 of the Indian Evidence Act, 1872. By establishing a threshold cap, banks can devise a policy to address claims in respect of lost individuals without depending on the submission of any documents other than the FIR, the traceable report by police authorities and indemnity letter.



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Thematic Funds Saw The Most Inflows In April: 4 Top CRISIL Rated Thematic Funds With 1-Year Return Up To 120%

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Investment

oi-Roshni Agarwal

|

As per the AMFI’s monthly mutual fund performance tracker report, net inflows into the open-ended equity schemes continued to be positive for the second straight month in April. Among the different categories, thematic or sectoral funds netted the most inflows to the tune of Rs. 1705 crore as per a Groww report. On the other hand, the subcategories that saw outflows include multi-cap fund, dividend yield fund, value fund/ contra fund and ELSS schemes.

Here we will discuss some of the top thematic funds in terms of their performance. But before that’s let’s understand thematic schemes and their other basics:

What are Thematic/Sectoral Funds?

Thematic mutual funds are open-ended equity schemes that invest in pre-decided investment theme. Say for instance, the fund bullish on agriculture situation in the economy will bet on all such areas including fertilizer, chemicals, and sugar stocks among others.

Who Should Invest In Thematic Funds?

– High risk takers:

Thematic funds are typically ideal for those who can afford high risk as thematic or sectoral funds are the riskiest categories among the various mutual fund sub-categories. This is because the scope of investment in the fund gets restricted as the investment is limited to the pre-decided theme. Consequently the fund is semi-diversified and in a case when the theme does not augurs well owing to any of the fundamentals or technical’s involved, the scheme might suffer substantially.

– Investor who has longer available term for the investment returns:

Higher returns are not generated overnight by any investment and same is the case with thematic funds that show up their best potential in some considerable span as the sector or the theme may take time to perform at its best. Buy by and large these schemes are not advised for new mutual fund investors.

– Well versed investors with know-how on macros, sectors etc:

Investor knowing about the macros of the economy, its dynamism and of the various sectors and the factors that influence them may be able to better pick the thematic funds as they are theme-based and may park their money into stocks from different sectors.

4 Five-Star CRISIL Ranked Thematic Funds That Gave 1-Yr Return Of Up To 120%

Scheme or fund name CRISIL Rank AUM( in crores) NAV 6 month 1 year 3 year 5-year return
DSP Natural Resources and New Energy fund- (G) 5* 588.74 49.3 60.55% 120.00% 13.00% 21.00%
Invesco India Infrastructure Fund-(G) 5* 113.87 23.91 34.00% 61.00% 10.00% 14.00%
BOI AXA Manufacturing and Infra fund- (G) 5* 46.3 23.06 33.00% 77.00% 7.00% 15.00%
Sundaram Rural and Consumption Fund- (G) 5* 1269.4 48.59 13.00% 43.00% 4.00% 11.00%

Note: Returns and NAV are as on May 14, 2021 and sourced from Money control website.

DSP Natural Resources and New Energy fund- (G):

DSP Natural Resources and New Energy fund- (G):

CRISIL 5-Star rating for the fund indicates very good performance among peer schemes. Expense ratio of the fund is 2.5% and falls under the high-risk category investment as per the MF risk-o-meter. The fund’s total investment into Indian stocks is 75% investment in of which 48.11% is into large cap, 23.4% is in mid cap and 2.38% in small cap stocks.

Rs.10000 invested in the scheme on May 12, 2020 is now value at Rs 21977, providing an annualized 1-year return of 120 percent. Some of the top holdings of the fund include Tata Steel, Jindal Steel and Power, Hindalco, Hindustan Zinc and SAIL among others.

Invesco India Infrastructure Fund-(G):

Invesco India Infrastructure Fund-(G):

Another 5 star rated thematic fund from the Invesco Mutual fund AMC is a high risk mutual fund scheme. Expense ratio of the fund is 2.65%which is more than the category average of 2.51%. Fund has over 90 percent investment into Indian stocks of which the major chunk goes to the small cap stocks of over 40 percent.

A sum of Rs. 10000 invested on May 12, 2020 are now worth Rs. 16295, giving an annualized return of 62.95%. The fund’s holdings comprise L&T, NTPC, KNR Constructions, RIL, Tata Steel, PNC Infratech and KEC International among others.

BOI AXA Manufacturing and Infra fund- (G):

BOI AXA Manufacturing and Infra fund- (G):

Another high risk thematic scheme entails an expense charge of 2.53%. 98% of the scheme’s investment is into Indian stocks of which the scheme is majorly invested into small cap stocks, while some of its investments are parked in G-securities. These schemes are primarily suitable for investors who have deep insight on the macros and wish to go for selective schemes that can produce higher return as against equity schemes.

Rs. 10000 invested on May 14, 2020 are now valued at Rs. 17684, providing annualized return of 77 percent. Top 10 stocks in the scheme’s portfolio include Honeywell Automation, Tube Investments, Divis Lab, Dixon Tech, APL Appolo Tubes, Gujarat Gas etc.

Sundaram Rural and Consumption Fund- (G):

Sundaram Rural and Consumption Fund- (G):

The scheme carries moderately high risk as per the Risk-o-meter and commands a lower expense ratio of 2.31 percent as against the category average of 2.36%. The fund is largely invested into large-cap scrips with 40% exposure in them.

Rs. 10000 invested in the fund as lump sum as on May 14 is valued at Rs.14337, generating an annualized return of 43 percent. The fund’s holding comprises Tata Consumer, Varun Beverages, HUL, Asian Paints, HDFC Bank, Mahindra and Mahindra, ICICI Bank, Ramco Cements etc.

Taxation on Thematic funds

Taxation on Thematic funds

It is the post-tax return that matter in the long run and hence depending upon your holding period, taxation rules apply.

Holding Period Capital gain Taxation rate
Is less than 1 year (units are sold off) Short term capital gains 15%
Holding period beyond 1 year Long term capital gain 10% ( on capital gains over Rs. 1 lakh in a FY)

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Atal Pension Yojana: Know Benefits On Death, Retirement And Tax Applicability

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Planning

oi-Sneha Kulkarni

|

A pension plan is a long-term investment in which you pay small, regular premiums over time to accumulate a retirement fund. A pension is essentially a tax-advantaged long-term savings plan. When you get tax relief on your pension, some of the money that would have gone to the government as taxes instead goes into your pension. The Atal Pension Yojana is a retirement plan aimed primarily at the unorganized sector. The scheme’s goal is to ensure that no Indian citizen in their old age has to worry about illness, accidents, or diseases, providing a sense of security.

One of the most beneficial social security schemes introduced by the government in 2015-16 is the Atal Pension Yojana. People can contribute to their Atal Pension Yojana account until they reach the age of 60 and receive a monthly pension as part of the scheme.

Atal Pension Yojana: Know Benefits On Death, Retirement And Tax

Since then, the Atal Pension Yojana has helped many Indians plan for their retirement. The Pension Fund Regulatory and Development Authority (PFRDA) administers this scheme using the NPS (National Pension System) architecture.

How to open Atal Pension Yojana Account?

Individuals can open an account using two methods, online and offline. One can visit the branch along with KYC documents fill the APY form and submit it. These forms are available in English, Hindi, Bangla, Gujarati, Kannada, Marathi, Odia, Telugu, and Tamil, among other languages. The form can be collected in the language of the individual’s choice. It is required balance to be maintained in the savings bank account/post office savings bank account for monthly, quarterly, or half-yearly contribution transfers.
The other way is to open the account online with the help of net banking. Banks such as HDFC Bank, ICICI Bank, Axis Bank, and SBI offer the online facility.

Atal Pension Yojana benefits to know about:

Death benefits of Atal Pension Yojana (APY)

The pension automatically vests in the spouse who is the default nominee upon the contributor’s death. In the event of the contributor’s and spouse’s deaths, the nominee will receive the predetermined corpus amount for the specific pension slab. If a contributor dies before reaching the age of 60, his or her spouse has the option of continuing the Atal Pension Yojana account and receiving benefits, or closing the account and receiving the contributions and gains made on it.
Upon the subscriber’s death, his or her spouse is entitled to the same pension as the subscriber.

The department will inform subscribers about PRAN activation, account balances, contribution credits, and other topics that will be communicated to APY subscribers via SMS alerts. Once a year, the subscriber will receive a physical Statement of Account.

Retirement benefits of Atal Pension Yojana (APY)

The retirement benefit is the most important aspect of the Atal Pension Yojana. The monthly pension will be paid out based on the contributions made. There are five different pension amounts: $1,000, 2,000, 3,000, 4,000, and 5,000 rupees. These pensions have different contribution amounts. The pension is paid to the spouse in the event of the subscriber’s death. A subscriber can, however, choose to reduce or increase his or her pension amount once a year during the accumulation phase.
If investment returns are higher than the guaranteed returns embedded in APY, subscribers will submit a request to the associated bank for drawing the guaranteed minimum monthly pension or a higher monthly pension after 60 years.

Tax benefits on Atal Pension Yojana (APY)

The Atal Pension Yojana tax benefits can be claimed up to Rs. 50,000 over and above the Rs. 1.5 lakhs under Section 80CCD (1B). The subscriber’s taxable income will be reduced as a result of this. In accordance with the maximum allowable deduction under section 80CCD(1) of the Income Tax Law, 1961 shall be 10 percent of gross total revenue covered by a maximum deduction of Rs. 1,50,000 p.a. Additional deductions under Section80CCD(1B) of the Income Tax Act1961, of Rs. 50 000 p.a. are eligible to be made for an additional contribution of Rs. 50 000 p.a. The total amount of deductions under sections 80C, 80CCC, and 80CCD(1), however, cannot exceed INR 1.5 lakhs, according to section 80CCE. In a financial year, the total deduction available under Section 80CCD (1B) plus Section 80C would be INR 2 lakhs.

Can a subscriber exit Atal Pension Yojana (APY) before the age of 60 Years?

It is possible to exit APY on your own terms. If a subscriber who has taken advantage of the Government co-contribution under APY chooses to voluntarily exit APY at a later date, he will only be refunded his contributions to APY, as well as the net actual accrued income earned on those contributions (after deducting account maintenance charges). Such subscribers will not receive the Government co-contribution or the accrued income from the Government co-contribution.

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Should You Invest In Fixed Deposits With Free Life Insurance Benefits?

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Suraksha FD By DCB Bank

This small private sector bank has allied with Aditya Birla Sun Life Insurance to provide fixed-deposit customers with free life insurance coverage up to Rs50 lakh for a three-year term. The free life insurance is available to investors between the ages of 18 and 54. This deposit scheme is only available to those who are 55 years old or older. The initial deposit needed is Rs10,000, with a three-year minimum term. The life insurance amount will be equal to the FD amount, up to a maximum of Rs50 lakh across all Suraksha FDs owned by the primary account holder. The free life insurance is only available for the first three years and can not be renewed. In the event of the depositor’s untimely death, the nominee can eventually seek the life insurance coverage under the policy’s terms and conditions. In terms of the deposit amount, the nominee has the option of prematurely closing the account at the current rate of interest or continuing until it matures.

FD Life (Fixed Deposit Life) By ICICI Bank

FD Life (Fixed Deposit Life) By ICICI Bank

ICICI Bank Fixed Deposits (FDs) provide guaranteed returns as well as life insurance security. When you open a Fixed Deposit of Rs 3 lakh or more for a minimum of 2 years, FD Life will offer you a complimentary life insurance of Rs 3 lakh for a year. By signing in to ICICI Bank Internet Banking, you can open an online FD Life. This FD account can be opened by resident individuals (age limit must be between 18 to 50 years) either jointly or individually. When the NRI individual is in India, he or she will have access to life insurance through their NRI FD. The GTP Life Cover will only be issued to the primary holder of a joint FD and will only be available for a year. Customers who are eligible should issue a declaration of good health. The GTP Life Cover will not be issued if a customer declares that he or she is not in good health condition as per the website of ICICI Bank. The free life cover available to customers will be withdrawn from the date of partial/premature withdrawal if the deposit is partially/prematurely withdrawn.

HDFC Bank SureCover FD

HDFC Bank SureCover FD

The SureCover FD from HDFC Bank is an innovative investment vehicle that combines the advantages of a Fixed Deposit with the coverage of a life insurance policy. On booking an HDFC Bank SureCover FD, you will get a life insurance cover equal to the Fixed Deposit principal for the first year. SureCover FDs offer the same interest as Regular Fixed Deposits. Individuals between the ages of 18 and 50 can take use of the HDFC Bank SureCover FD, which can be taken out for a minimum of Rs. 2 lacs and a maximum of Rs. 10 lacs. SureCover FDs are available for a minimum of 12 months and a maximum of 120 months. The life insurance policy will be available for one year and can be renewed by the primary purchaser by paying the applicable premium amount from the second year onwards. On the SureCover FD, you can choose to receive interest monthly or quarterly, but the monthly return rate will be lower than the regular deposit rate. The insurance cover will be terminated with if the Fixed Deposit is fully or partially withdrawn within a year, i.e. >=50% of the initial principal amount. For the first year, the customer is not required to pay a premium. However, the premium for upcoming years, starting from the second year (if relevant), will be charged and paid by the FD’s primary owner. If a customer has a Live SureCover FD under his or her customer ID, he or she cannot get another SureCover FD. According to the HDFC Bank website, a customer can apply for another SureCover FD only after one year has expired after his current FD maturity/pre-closure date.

Our take

Our take

A life insurance scheme offers risk cover to the family’s dependents in the event of the policyholder’s demise. One can opt for various life insurance plans individually according to his or her needs such as term insurance plans, whole life insurance plans, retirement plans, senior citizen plans, and other forms of life insurance plans. Life insurance plans are treated as a long-term investment vehicle and are purchased to protect your loved ones from financial threats in the event of your death. Every individual should have life insurance, but a short-term, low-sum assured life insurance policy is counterproductive. As a common concept, you should have 10 times your annual income in life insurance. For instance, if your annual income is Rs 5 lakh, you should have Rs 50 lakh in life insurance. Also, the insurance should protect you before you reach retirement age. These crucial ingredients of life insurance cannot be met with complimentary life insurance benefits that comes with the above discussed FD schemes. As a result, it is not worthwhile to accept bank fixed deposits based on goodies such as life insurance or some other form of insurance and fixed deposits of banks that are considered stable and secure can be preferred by investors.



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Dogecoin’s popularity soars ahead of Nifty, mutual funds in India, BFSI News, ET BFSI

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MUMBAI: A joke well said is when everyone laughs or at least goes back home and Googles it. Mind-numbing rallies in the cryptocurrency world are not absurd, but the rise of the ‘Doge’ has confounded even the biggest of cryptocurrency lovers.

Dogecoin, a cryptocurrency born out of a light-hearted joke in 2013 with no revolutionary endeavours, such as those of Bitcoin creator, has soared 5,500 per cent in 2021 so far, despite having nearly halved its value over the past week.

Simply put, Dogecoin is an Internet meme currency with the symbol of the Japanese Shiba Inu dog for the meme generation, backed by individuals like Elon Musk, the founder of Tesla, SpaceX and Starlink.

And, Indians are intrigued.

The popularity of the meme cryptocurrency has been soaring among Indians since the beginning of April from virtually zero interest prior to that. Much of the interest has been driven by reports that pegged the digital currency’s returns at over 10,000 per cent year to date, something unheard of in the world of traditional investing.

More Indians were searching for the term ‘Dogecoin’ on Google on Friday than Bitcoin and mutual funds combined, data on Google search trends showed. The rise in popularity of the cryptocurrency has been such that it is threatening to overtake popular search terms in India’s investing landscape like ‘Nifty’ and ‘Sensex’.

Industry watchers in India said almost all of the interest in Doogecoin is being driven by young investors, who are ardent admirers of Elon Musk, given his image as a futurist and his involvement in the development of some of the most revolutionary companies of the 21st century.

The surge in interest is despite Dogecoin giving up almost half of its value earlier this week following the Tesla Founder’s comments on a popular US comedy show that the cryptocurrency was nothing more than a ‘hustle’, confirming the suspicion of most.

Prior to Musk’s appearance on the Saturday Night Live last week, the interest in Dogecoin virtually broke the roof for the cryptocurrency market, as several cryptocurrency exchanges in India such as WazirX were unable to handle the deluge of orders.

WazirX, India’s largest cryptocurrency exchange, reported one of the highest single-day trading volumes of $350 million on May 7, a day prior to Musk’s appearance on the show. Some industry watchers suggested that much of the volumes were being driven by Dogecoin investors.

Musk has tried to make amends ever since his SNL gaffe by announcing the launch of a moon mission called DOGE-1, which will be funded entirely by Dogecoin.

Further, his Twitter poll earlier this week on whether Tesla should accept payment in Dogecoin or Bitcoin coincided with the shock announcement on Thursday that the electric vehicle company will suspend acceptance of Bitcoin as payment due to environment-related concerns.

“…if Elon Musk is able to improve some of its technical flaws as he said, that could help it gain long-term value,” said Vikram Rangala, chief operating officer at ZebPay.

Dogecoin’s lack of fundamental value compared with other major crypto assets such as Bitcoin and Ethereum is not lost even on cryptocurrency experts, who argue that it has none of the traits such as fixed supply that have made Bitcoin popular.

However, when the world’s second richest man is himself on the driver’s seat, one can only expect people to hop on to the bandwagon.



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Bitcoin tumbles below $45,000 after 3 months after Elon Musk implies Tesla may sell crypto, BFSI News, ET BFSI

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By Patrick McHale and Yueqi Yang

Elon Musk continued to whipsaw the price of Bitcoin, briefly sending it to the lowest since February after implying in a Twitter exchange Sunday that Tesla Inc. may sell or has sold its cryptocurrency holdings.

Bitcoin slid below $45,000 for the first time in almost three months after the billionaire owner of the electric-car maker seemed to agree with a Twitter post that said Tesla should divest what at one point was a $1.5 billion stake in the largest cryptocurrency. It traded at $45,270 as of 5:51 p.m. in New York, down about $4,000 from where it ended Friday.

The online commentary was the latest from the mercurial billionaire in a week of public statements that have roiled digital tokens. He lopped nearly $10,000 off the price of Bitcoin in hours last Wednesday after saying Tesla wouldn’t take it for cars. A few days earlier, he hosted “Saturday Night Live” and joked that Dogecoin, a token he had previously promoted, was a “hustle,” denting its price. Days later he tweeted he was working with Doge developers to improve its transaction efficiency.

Bitcoin tumbles below $45,000 after 3 months after Elon Musk implies Tesla may sell crypto
Musk’s disclosure in early February that Tesla used $1.5 billion of its nearly $20 billion in corporate cash to buy Bitcoin sent the token’s price to record and lent legitimacy to electronic currencies, which have become more of a mainstream asset in recent years despite some skepticism.

His latest dustup with Bitcoin started with a tweet from a person using the handle @CryptoWhale, which said, “Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings. With the amount of hate @elonmusk is getting, I wouldn’t blame him…”

The Tesla chief executive officer responded, “Indeed.”

The twitter account @CryptoWhale, which calls itself a “crypto analyst” in its bio, also publishes a Medium blog on market and crypto trends.

Musk has spent hours Sunday hitting back at several different users on Twitter who criticized his change of stance on Bitcoin last week, a move he said was sparked by environmental concerns over the power demands to process Bitcoin transactions. He said at the time that the company wouldn’t be selling any Bitcoin it holds.

An outspoken supporter of cryptocurrencies with cult-like following on social media, Musk holds immense sway with his market-moving tweets. He has been touting Dogecoin and significantly elevated the profile of the coin, which started as a joke and now ranks the 5th largest by market value.

Dogecoin is down 9.6% in the last 24 hours, trading at 47 cents late Sunday afternoon, according to data from CoinMarketCap.com.

Tesla didn’t immediately respond to an email seeking comment on Musk’s tweet on Sunday.

Musk’s Sunday social-media escapades were the latest chapter in one of the zaniest weeks in a crypto world famous for its wildness. For die hards, the renewed slumps in Bitcoin and other tokens have done nothing to deter crypto enthusiasts who say digital coins could many times their current value if they transform the financial system.

“We’re looking at the long-term and so these blips, they don’t faze us,” Emilie Choi, president and chief operating officer of crypto exchange Coinbase Global Inc., said last week on Bloomberg TV about the wild swings prevalent in the market. “You’re looking for the long-term opportunity and you kind of buckle up and go for it.”

Seat belts were needed by anyone watching the crypto world in the past eight days. Aside from Musk’s antics that sent Doge and Bitcoin on wild rides, a host of other developments pushed around prices.

Tether, the world’s largest stablecoin, disclosed a reserves breakdown that showed a large portion in unspecified commercial paper. Steve Cohen’s Point72 Asset Management announced that it would begin trading cryptocurrencies. And a longstanding critique of the space reared its head again: illicit usage.

It was reported that the owners of the Colonial Pipeline paid a $5 million ransom in untraceable digital currencies to hackers that attacked its infrastructure, while Bloomberg also reported that Binance Holdings Ltd., the world’s biggest cryptocurrency exchange, was under investigation by the Justice Department and Internal Revenue Service in relation to possible money-laundering and tax offenses.

But, “for many crypto assets such as Bitcoin and Ethereum, the long-term story has not changed,” said Simon Peters, an analyst at multi-asset investment platform eToro. “This emerging asset class continues to revolutionize many aspects of financial services, and while nothing goes up in a straight line, the long-term fundamentals for crypto assets remain as solid as ever.”

Bitcoin was already swinging wildly on the weekend before Musk tweeted. The two days tend to be particularly volatile for cryptocurrencies, which — unlike most traditional assets — trade around the clock every day of the week. Bitcoin’s average swing on Saturdays and Sundays so far this year comes in at 4.95%.

That type of volatility is owing to a few factors: Bitcoin’s held by relatively few people, meaning that price swings can be magnified during low-volume periods. And, the market remains hugely fragmented with dozens of platforms operating under different standards. That means cryptocurrencies lack a centralized market structure akin to that of traditional assets.

–With assistance from Vildana Hajric and Brandon Kochkodin.



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3 Post Office Schemes That Beat Bank Interest Rates

Personal Finance

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Post office time deposit – 5 years

If you are looking at a saving instrument for a period of 5-years, then the post office time deposit will beat bank interest rates. In fact, the maximum interest rates that banks offer on a 5-year deposit is 5.5 per per annum. We are talking of the larger private and public sector banks and not the smaller ones or the small finance banks.

Compared to the same, you get an interest rate of 6.8% on a time deposit of the post office. If the deposits are really large by an investor, than an interest differential of 1.3% per annum can make a big difference. However, one of the disadvantages is that if you invest for such a long tenure and if interest rates go up, you could lose.

National Savings Certificate

National Savings Certificate

The interest here again like the NSC is around 6.8%. A sum of Rs 1000/- grows to Rs 1389.49 ​after 5 years. Interest rates over the last few years have just collapsed and for a safe government backed security, this is not bad at all. Another advantage of that the National Savings Certificate is that it gives you tax benefits under SEC80C.

However, it’s important to note that the interest earned is not exempted from tax. So, the interest earned is subject to tax. Again, a good interest rate, but the tenure is too high, as interest rates could climb in the more medium term. Interestingly, an individual can open multiples accounts under the scheme and up to 3 joint accounts can be opened.

PPF

PPF

This is not a post office scheme in that sense, given that even banks open the same. Nonetheless, it is still popularly a part of the post office schemes as well. This is one scheme, which is a must have in any portfolio.

The interest earned is completely tax free in the hands of investors, while the investment itself, gives you tax benefits under SEC80C. The interest rate of 7.1% is the best and is probably beaten only by the Senior Citizens Savings Scheme.

The one disadvantage of the scheme though is the long tenure of 15-years. If the PPF account is closed at anytime before 5 years, there is a charge that is deducted from the principal amount. So, if you are not going to invest for the long-term, its better you do not invest.

About the author

About the author

Sunil Fernandes has spent 26 years covering business and finance in India and abroad. Sunil has worked with frontline daily newspapers including Hindustan Times, Deccan Herald and Gulf Times. He has also worked with investment magazines like Dalal Street Investment Journal and Oman Economic Review. His forte remains stocks, mutual funds and tax planning.



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Will Interest Rates On PPF, NSC, Post Office Deposits Be Cut On July 1?

Personal Finance

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Investment

oi-Sunil Fernandes

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There is some speculation that there could be a cut in interest rates on post office small savings schemes like PPF, NSC, Sukanya Samriddhi, Senior Citizens Savings Scheme, Kissan Vikas Patra and post office time deposits.

Reasons to conclude for a cut in interest rates

What is happening right now is that it is very difficult to keep bond yields low, the sovereign bond yields low and the government has some huge borrowing lined-up. The fiscal deficit of the government for 2021-22 has been projected at 6.8%, thanks to the cascading impact of Covid-19. This means the government has to borrow heavily and higher the costs at which it has to borrow, the pressure would show on the fiscal deficit.

Will Interest Rates On PPF, NSC, Post Office Deposits Be Cut On July 1?

Also, a lot of the government borrowings, can push bond yields higher. The worry right now is that unless interest rate on small savings comes down, it is difficult to push interest rates overall lower. Apart from this there is an anomaly between the interest rates being offered by banks and the post office. Take a look at the table below.

Quick comparison between small savings and bank deposits rates

1-2 years 2-3 years 5 years and above
SBI 4.90% 5.20% 5.40%
HDFC Bank 4.90% 5.15% 5.50%
ICICI Bank 4.90% 5.15% 5.25%
Post office time deposit 5.50% 5.50% 6.80%
Public Provident Fund 7.10%
Kissan Vikas Patra 6.90%
National Savings Certificate 6.80%
Senior Citizens Savings Scheme 7.40%
Sukanya Samridhhi 7.60%

Clearly, post office rates are better, which might prompt the government to reduce the interest rates. Apart from this lower interest rates on deposits would push lower rates on borrowings, which in turn could propel borrowings and hence the economy.

The government revises the interest rates on the different post office schemes every quarter. So, the next due date for revision is July 1, 2021. It’s always difficult to predict what the authorities would do. However, investors have the time until July 1, to decide if they want to invest now on the hope that interest rates would fall.

We advise investors not to look for longer term tenure of instruments like 5 years and beyond. Invest for the shorter term and more like medium term. This is because if interest rates rise, which we believe it should, you would benefit.

GoodReturns.in

About author:

Sunil Fernandes, the author of this article has spent 2 and half decades covering business and finance in India and abroad. Sunil has worked with frontline daily newspapers and investment magazines in India and abroad.



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CBIC Initiates Special GST Refund and Drawback Disposal Drive

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Taxes

oi-Sneha Kulkarni

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The Central Board of Indirect Taxes and Customs (CBIC) has given its commissioners instructions to conduct a special drive to resolve all pending refund claims. The drive comes at a time when a business has been disrupted by movement restrictions in many parts of the country.

Eligible GST taxpayers can check their GST refund status online, through GST Portal.
In these difficult times, the CBIC stated that the Board has decided that it is necessary to focus on timely disposal of all pending refund/duty drawback claims in order to provide immediate relief to business entities, particularly MSMEs.

CBIC Initiates Special GST Refund and Drawback Disposal Drive

“It is hereby instructed that a ‘Special GST Refund Disposal Drive’ will be launched by all Central Tax formations during the period from 15th May 2021 to 31st May 2021 for processing and disposal of all pending GST refund claims on priority,” it said.

The CBIC also stated that the GST law allows for a 15-day period for issuing an acknowledgment or deficiency memo, as well as a total of 60 days for dealing with refund claims without the need to pay interest.

Important Things To Know

  • This applies to all GST refunds and Customs Duty Drawback claims that are still pending.
  • All pending refunds, including those for large corporations, will be extended, with a special focus on MSME.
  • The special drive is intended to expedite the resolution of pending claims, not to provide a window for correcting erroneous refunds.
  • To make it easier for exporters, all communication should be done via email, if the applicant’s email address is available.

“It is urged that in these difficult times, all central tax officers should endeavor to make their best efforts and contribution in the fight against COVID-19, by liquidating the pending GST refund claims by May 31, 2021,” the CBIC added.

GoodReturns.in



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