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Sanjeev Govila  |458 Answers  |Ask -

Financial Planner - Answered on Nov 11, 2023

Colonel Sanjeev Govila (retd) is the founder of Hum Fauji Initiatives, a financial planning company dedicated to the armed forces personnel and their families.
He has over 12 years of experience in financial planning and is a SEBI certified registered investment advisor; he is also accredited with AMFI and IRDA.... more
Asked by Anonymous - Nov 02, 2023Hindi
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Sir,I have worked in private company from September 2011 to feb 2021 where my pf amount was deducted.l have completed 9 years 5 months service and resigned but not withdrawn pf amount.I want to get pension after 60 years what should I do ?

Ans: You can only get pension under the Employees' Pension Scheme (EPS) if you have completed at least 10 years of service. However, you can still withdraw your EPF amount even if you have not completed 10 years of service. To redeem your EPF amount, you can follow these steps:

1. Merge all your previous PF accounts. This can be done online through the EPFO website or at any EPFO office.
2. Fill the Composite Claim Form (Aadhaar based) and submit it to your previous employer.
3. Attach the following documents:

•Copy of your Aadhaar card.
•Copy of your PAN card.
•Bank account statement showing your IFSC code and account number.
•Cancelled cheque from your bank account.

4. Your previous employer will verify the details and submit the form to the EPFO.
5. The EPFO will process your claim and transfer the EPF amount to your bank account.

If you have not worked for more than two months after resigning from your job, you can withdraw the entire balance in your EPF account. If you have worked for more than two months after resigning from your job, you can withdraw only 75% of the balance in your EPF account. The remaining 25% can be withdrawn after two months of unemployment.

Note – If you will continue your services in another company for next 6 month you will be eligible for the pension.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |7947 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 26, 2024

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Sir,I have worked in private company from March 2011 to Sep 2021 where my pf amount was deducted.l have completed 10 years 5 months service and resigned but not withdrawn pf amount.I want to get pension after 60 years what should I do ?
Ans: Securing Pension Benefits from EPF After Retirement
Planning for pension benefits from your EPF account after retirement requires careful consideration and proactive steps. Let's outline a strategy to ensure you receive pension benefits after turning 60.

Understanding EPF Pension Eligibility
Assessing Eligibility Criteria

Confirm eligibility for EPF pension benefits by ensuring you have completed at least 10 years of eligible service, which you have accomplished.
Verifying EPF Account Details

Verify that your EPF account reflects your entire service duration accurately, including the period from March 2011 to September 2021.
Retaining EPF Account for Pension Benefits
Maintaining EPF Account

Avoid withdrawing your EPF amount upon resignation to retain eligibility for pension benefits.
Let your EPF account accrue interest and remain active until you reach the age of 60.
Ensuring Continuous Contributions

If you join another organization, ensure that your new employer continues contributing to your EPF account, maintaining the continuity of your EPF membership.
Applying for Pension Benefits
Submitting Pension Application

Upon reaching the age of 60, submit an application for pension benefits to the Employees' Provident Fund Organization (EPFO).
Provide necessary documents, such as identity proof, EPF account details, and pension application form, as per EPFO guidelines.
Completing Formalities

Fulfill any additional formalities required by EPFO, such as verification of service details and submission of supporting documents.
Seeking Professional Advice
Consulting Certified Financial Planner (CFP)

Seek guidance from a Certified Financial Planner (CFP) specializing in EPF matters to ensure compliance with EPF regulations and optimize pension benefits.
A CFP can assist in navigating the pension application process and addressing any complexities or queries that may arise.
Regular Monitoring
Monitoring EPF Account

Periodically monitor your EPF account statements to ensure accuracy and track the accumulation of pension benefits over time.
Following Up with EPFO

Follow up with EPFO authorities regarding the status of your pension application and address any delays or discrepancies promptly.
Conclusion
By retaining your EPF account and completing the necessary formalities upon reaching the age of 60, you can secure pension benefits from your EPF account after retirement. Seeking professional advice and maintaining regular communication with EPFO authorities will help streamline the process and ensure a smooth transition to pension benefits.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |7947 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 12, 2025

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investing 10 lakhs in Mutual Funds: what fund option should I consider for 3 Years?
Ans: Investing for three years requires balancing returns and safety. Your choice should depend on risk tolerance, taxation, and liquidity needs.

Key Factors to Consider
A three-year horizon is short for equity investments.
Volatility in equities can impact returns if markets decline near redemption.
Debt funds provide stability but may have lower returns than equity funds.
Hybrid funds balance risk and returns better than pure equity or debt funds.
Taxation on mutual funds should be considered before making a choice.
Investment Options Based on Risk Profile
For Conservative Investors
Capital safety is a priority for conservative investors.
Debt mutual funds are suitable due to lower risk.
Short-duration and corporate bond funds offer better returns than fixed deposits.
Dynamic bond funds can work if comfortable with some interest rate risk.
Returns may be lower, but capital protection is higher.
For Moderate Investors
A mix of debt and equity is ideal.
Hybrid funds help balance stability and growth.
Aggressive hybrid funds invest around 65% in equity and 35% in debt.
Conservative hybrid funds invest more in debt and less in equity.
These funds can generate better returns than pure debt funds.
For Aggressive Investors
Equity funds can provide higher returns but come with risk.
Large-cap or flexi-cap funds are better than mid-cap or small-cap for three years.
Equity savings funds reduce risk by holding debt and arbitrage components.
Investors should be ready for short-term volatility in equity investments.
A systematic withdrawal plan (SWP) after three years can help manage risks.
Mutual Fund Taxation for 3-Year Investment
Equity fund LTCG above Rs. 1.25 lakh is taxed at 12.5%.
Equity STCG is taxed at 20%.
Debt funds are taxed as per the investor’s income tax slab.
Hybrid funds taxation depends on their equity component.
Investors in high tax brackets may prefer equity-oriented funds for tax efficiency.
Regular Funds vs Direct Funds
Regular funds provide Certified Financial Planner (CFP) support and expert guidance.
Direct funds may appear cheaper but lack personalized financial advice.
Market conditions change, and professional guidance helps navigate investments.
Investors often make emotional decisions, which a CFP helps avoid.
Long-term returns may be higher with proper advisory support.
Actively Managed Funds vs Index Funds
Actively managed funds aim to beat market returns.
Fund managers adjust portfolios based on market conditions.
Index funds simply follow market indices and lack flexibility.
Actively managed funds can protect during market downturns.
A three-year horizon does not favor passive investing due to short-term volatility.
When to Choose a Systematic Investment Plan (SIP)
A lump sum investment is ideal when markets are low.
SIP helps reduce risk in volatile markets.
If investing in equity or hybrid funds, staggered investment through SIP can help.
Debt funds are better suited for lump sum investments.
SWP can be used for gradual withdrawal after three years.
Liquidity and Exit Strategy
Some funds have exit loads if redeemed before a certain period.
Hybrid and debt funds often have lower exit loads than equity funds.
Ensure liquidity by choosing funds with flexible redemption options.
Plan redemptions at least 3-6 months before the end of the investment period.
Final Insights
Debt funds are safer for conservative investors.
Hybrid funds offer a balance of risk and reward.
Equity funds suit aggressive investors but require risk tolerance.
Mutual fund taxation should be considered before investing.
Regular funds with CFP guidance provide better long-term benefits.
Would you like help in selecting specific categories within these options?

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ramalingam

Ramalingam Kalirajan  |7947 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 12, 2025

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Hi Team, I have been investing 5percent of my sip in Nasdaq but now unable to do sip. Could you please let me know whichother mf house are accepting sip for global investment
Ans: It seems you were investing in Nasdaq through a mutual fund SIP but are now unable to continue. You are looking for mutual fund houses that still accept SIPs for global investments.

There are multiple factors to consider before continuing with global investments.

Understanding Restrictions on Global SIPs
Many mutual funds had to pause fresh investments in international schemes.
This was due to regulatory restrictions on overseas investment limits.
Some fund houses have reopened investments, but availability changes frequently.
The acceptance of SIPs depends on whether they have room within the limits.
Mutual Fund Houses Offering Global Investments
Some Indian fund houses continue to accept SIPs for international funds.
They may invest in US markets, European markets, or emerging economies.
Some focus on technology stocks, while others cover broader sectors.
The availability of SIPs can change based on fund house policies.
You should check with the fund house or an expert before investing.
Should You Continue Global Investments?
The US market has given strong returns in the long term.
However, global investing comes with risks like currency fluctuations.
The rupee’s movement against the dollar impacts your returns.
The US market is expensive compared to Indian equities.
Diversification is good, but overexposure to a single market is risky.
Actively Managed Funds vs Index Funds
Many global funds track indices like Nasdaq or S&P 500.
Index funds may seem cost-effective, but they lack flexibility.
Actively managed global funds adjust portfolios based on market conditions.
Professional fund managers help manage risks in different economies.
Actively managed funds can outperform during market downturns.
Evaluating Your Investment Strategy
If you were investing 5% in Nasdaq, consider how it fits your overall plan.
Stopping SIPs should not disrupt your long-term goals.
If you cannot continue, ensure other investments balance your portfolio.
Look for options that align with your risk appetite and investment horizon.
Taxation of Global Mutual Funds
Global equity funds are taxed like debt funds.
There is no benefit of lower taxation like domestic equity funds.
Gains are taxed based on your income tax slab.
If you hold for more than three years, taxation remains the same.
Keep tax efficiency in mind while choosing investment options.
What Should You Do Next?
Check with mutual fund houses about SIP availability in global schemes.
If SIP is unavailable, you can still invest through lump sum when the window opens.
Consider balancing global and Indian investments for better diversification.
Review your financial plan to ensure your goals stay on track.
Finally
Investing in global markets can be beneficial, but not without risks.
Active management is preferable over index-based global funds.
Ensure you are aware of taxation before investing.
Focus on a diversified portfolio instead of chasing one market.
Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ramalingam

Ramalingam Kalirajan  |7947 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 12, 2025

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I HAVE RECIEVED A SUM OF RS 10 LACS FROM FRIEND TO PURCHASE A HOUSE - HE HAS STATED I CAN RETURN MONEY AFTER MY DAUGHTER IS EARNING ENOUGH MONEY TO REPAY . I HAVE NOT BEEN FILING RETURNS SINCE I DONT HAVE TAXABLE INCOME . SHOULD I FILE I T RETURN FOR THIS AMOUNT - UNDER WHICH HEAD OF INCOME WILL I HAVE TO SHOW - SHOULD I MENTION IT AS GIFT OR LOAN
Ans: You have received Rs. 10 lakh from a friend for purchasing a house. The friend has stated that you can return it when your daughter starts earning. Since you have not been filing tax returns, let’s assess whether you should file a return and how to declare this amount.

Is Filing an ITR Necessary?
You don’t have taxable income, so filing is usually not required.
However, Rs. 10 lakh in your account can attract scrutiny.
To avoid future issues, filing an ITR is advisable.
It helps maintain transparency with the tax department.
How to Declare This Amount?
This is not a gift because a gift from a friend is taxable if above Rs. 50,000.
It is best to treat this as a loan.
Loans from friends do not attract tax but should be documented.
Declaring It Under the Right Income Head
A personal loan is not income, so it does not fall under "Income from Other Sources."
It is not taxable, but should be disclosed as "Loan Taken" in the balance sheet section of ITR.
If interest is paid on the loan, that interest will be taxable for the lender.
Steps to Ensure No Future Tax Issues
Keep a written agreement mentioning the loan terms.
The agreement should mention that repayment will be made after your daughter starts earning.
Ideally, the friend should transfer funds through a bank and not in cash.
If the tax department questions the transaction, you can show this agreement.
Final Insights
Filing an ITR is recommended for clarity.
Declare the amount as a loan, not a gift.
Maintain proper documentation to avoid future issues.
Ensure transactions happen through a bank for transparency.


Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ramalingam

Ramalingam Kalirajan  |7947 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 12, 2025

Asked by Anonymous - Feb 02, 2025Hindi
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I am an employee. My company pays my rent amount to my house owners account. the amount is 9000. but my house rent is 4900 and I asked to return the remaining amount to return to me. My house owner is a senior citizen and has 5 houses. remaining houses pay rent in cash. He said I get taxed on the amount so I am deducting the tax amount. I feel he is cheating me in the name of tax. please help me in this issue.
Ans: Your house owner is deducting tax from the extra rent you asked him to return. It is important to assess whether this is a fair deduction or if he is keeping a part of your money unfairly.

Understanding Taxation on Rental Income
Your house owner is a senior citizen and has five rental properties.
He receives rent from other tenants in cash, which may not be reported as income.
The rent he receives from you is directly deposited into his bank account. This means it is officially recorded.
He may be liable to pay tax on this recorded income.
Why Is He Deducting Tax?
If he is filing income tax returns properly, he should pay tax on total rental income.
The tax he pays depends on his total income, including all rental earnings.
If he has no other income, rental income is taxed as per his slab.
If his total taxable income exceeds the exemption limit, tax is applicable.
Assessing If He Is Cheating You
Your employer is paying Rs 9,000 rent, but your actual rent is Rs 4,900.
The extra Rs 4,100 should be returned to you in full.
He is deducting a tax amount before refunding, which raises concerns.
The tax rate he claims to deduct should be verified.
If he is keeping a significant portion, he may be misusing tax as a reason.
Steps to Verify the Tax Deduction
Ask him to provide a written explanation of the tax deduction.
Request a receipt or breakdown of how much tax he is paying on rental income.
Check his income tax return (if he agrees) to see if he is genuinely paying tax.
If he is hesitant, he may be deducting more than required.
What Can You Do?
Ask your employer to pay only Rs 4,900 directly to him instead of Rs 9,000.
If the employer insists on paying Rs 9,000, ask for an official agreement with the owner.
Clarify in the agreement that extra rent paid will be refunded without deductions.
If he refuses, inform him that you will consult a tax expert.
You can also ask him to show proof of tax paid on the deducted amount.
Handling This in a Legal Way
There is no rule that allows a landlord to deduct tax from refunded rent.
Rental income tax is the landlord’s responsibility, not yours.
He should pay tax on his total income, not on your refund.
If he is deducting an unusually high amount, it is unfair.
Alternative Options
Consider renting a different house where the rent payment process is straightforward.
If your employer allows, request them to revise the rent agreement.
Check if your company can provide a direct reimbursement to you instead.
Final Insights
Your landlord is responsible for paying tax on his rental income.
He cannot deduct tax from the amount he is refunding to you.
If he insists on deducting tax, ask for proof and clarification.
If he refuses to return the full extra amount, he may be misusing tax as an excuse.
You can take steps to ensure you receive the rightful refund.
Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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