GSTPAM News Bulletin August 2022

 

Type of Membership	Membership Fees incl. GST	Admission Fees Incl. GST	Subscription Charges for GST Review	Total
New Membership Application
Donor Member	24,780.00	–	600.00	25,380.00
Patron Member	17,700.00	–	600.00	18,300.00
Life Member	11,800.00	944.00	600.00	13,344.00
Life Member (Conversion from Ordinary)	11,800.00	590.00	600.00	12,990.00
Ordinary Local Member	1,770.00	590.00	–	2,360.00
Ordinary Outstation Member	1,475.00	590.00	–	2,065.00
New Membership Application (Firm/LLP)
Ordinary Local Member	1,770.00	944.00	0	2,714.00
Ordinary Outstation Member	1,475.00	944.00	0	2,419.00
Patron Member	17,700.00	0	600.00	18,300.00
Donor Member	24,780.00	0	600.00	25,380.00
Advance Membership/ Subscription charges for subsequent two years 2023-24& 2024-25 (Non-Refundable)
Ordinary Local Member	3,186.00	–	–	3,186.00
Ordinary Outstation Member	2,655.00	–	–	2,655.00
Life Member (Individual/Firm/LLP)	0	–	1,200.00	1,200.00
Patron Member	0	–	1,200.00	1,200.00
Donor Member	0	–	1,200.00	1,200.00
Subscription for GST Review for F.Y. 2022-23 by Non-Members
Subscription fees for GSTR	–	–	1,000.00	1,000.00
Advance Membership / Subscription charges for subsequent two years 2023-24& 2024-25 (Non-Refundable)
Subscription Fees -GSTR	0	–	2,000.00	2,000.00

 

Modes Of Payment:-

 

Cheque	A/c Payee Cheque drawn in favor of “The Goods & Services Tax Practitioners’ Association of Maharashtra” payable at Mumbai.” payable at Mumbai.
NEFT Details	The Goods & Services Tax Practitioners’ Association of Maharashtra Bank of India, Mazgaon Branch Current Account No. 007020100001816, IFSC Code – BKID0000070. Online generated transaction Acknowledgment should be sent by email on [email protected] along with membership and payment details Members are requested to send their physical form to the association for Approval, Issuance and Office record.
Cash	Renewal form along with requisite amount will be accepted between 10.30 a.m. and 5.30 p.m. on all working days except Saturday at our Office at Mazgaon Library – Mazgoan: 1st Floor, 104, GST Bhavan, Mazgaon, Mumbai – 400 010 Or Bandra Library – GST Bhavan, Ground Floor, A Wing, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051. Or Mazgaon Tower-8 & 9, Mazgaon Tower, 21, Mhatar Pakhadi Road, Mazgaon, Mumbai – 400 010.
Identity (New Members)	New Members should provide the following as Identity Proof : PAN, Aadhar Card, Constitution Document. Address Proof(any one) : Electricity Bill / Passport/ Aadhar Card / Driving License/ Voter id/ Ration Card along with Membership Form
Identity Card (For Renewals)	Ordinary Local/Outstation Members should provide Two Photographs along with the Renewal Form for issue of I-cards.
Online Payment Link	Members can make online payment on our website www.gstpam.org. Members are requested to download Members Renewal form from website. Update the latest details in the form, scan it and mail at [email protected] Payment Link : https://www.gstpam.org/online/renew-membership.php If you are login first time? Click here for create your password

 

We value your continuation of the membership and look forward to your renewal to this effect.

Dated:-31.01.2022

Mahesh Madkholkar Parth Badheka Hon. Jt. Secretary

 

GST, MVAT & ALLIED LAW UPDATES Compiled by Adv. Pravin Shinde

 

 

Central Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
03/2022	13.07.2022	Seeks to amend Notification No 11/2017- Central Tax (Rate) dated 28.06.2017
04/2022	13.07.2022	Seeks to amend Notification No 12/2017- Central Tax (Rate) dated 28.06.2017
05/2022	13.07.2022	Seeks to amend Notification No 13/2017- Central Tax (Rate) dated 28.06.2017
06/2022	13.07.2022	Seeks to amend notification No. 1/2017- Central Tax (Rate)
07/2022	13.07.2022	Seeks to amend notification No. 2/2017- Central Tax (Rate)
08/2022	13.07.2022	Seeks to amend notification No. 3/2017- Central Tax (Rate)
09/2022	13.07.2022	Seeks to amend notification No. 5/2017- Central Tax (Rate)
10/2022	13.07.2022	Seeks to amend notification No. 2/2022- Central Tax (Rate)
11/2022	13.07.2022	Rescinds notification No. 45/2017- Central Tax (Rate)

 

Integrated Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
03/2022	13.07.2022	Seeks to amend Notification No 8/2017- Integrated Tax (Rate) dated 28.06.2017
04/2022	13.07.2022	Seeks to amend Notification No 9/2017- Integrated Tax (Rate) dated 28.06.2017
05/2022	13.07.2022	Seeks to amend Notification No 10/2017- Integrated Tax (Rate) dated 28.06.2017
06/2022	13.07.2022	Seeks to amend notification No. 1/2017- Integrated Tax (Rate)
07/2022	13.07.2022	Seeks to amend notification No. 2/2017- Integrated Tax (Rate)
08/2022	13.07.2022	Seeks to amend notification No. 3/2017- Integrated Tax (Rate)
09/2022	13.07.2022	Seeks to amend notification No. 5/2017- Integrated Tax (Rate)
10/2022	13.07.2022	Seeks to amend notification No. 2/2022- Integrated Tax (Rate)
11/2022	13.07.2022	Rescinds notification No. 47/2017- Integrated Tax (Rate)

 

Union Territory Tax Notifications
Notification No.	Date of Issue	Subject
03/2022	13.07.2022	Seeks to amend notification No. 02/2019- Union Territory Tax
04/2022	13.07.2022	Seeks to amend notification No. 02/2017- Union Territory Tax

 

Union Territory Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
03/2022	13.07.2022	Seeks to amend Notification No 11/2017- Union territory Tax (Rate) dated 28.06.2017.
04/2022	13.07.2022	Seeks to amend Notification No 12/2017- Union territory Tax (Rate) dated 28.06.2017.
05/2022	13.07.2022	Seeks to amend Notification No 13/2017- Union territory Tax (Rate) dated 28.06.2017.
06/2022	13.07.2022	Seeks to amend notification No. 1/2017- Union Territory Tax (Rate)
07/2022	13.07.2022	Seeks to amend notification No. 2/2017- Union Territory Tax (Rate)
08/2022	13.07.2022	Seeks to amend notification No. 3/2017- Union Territory Tax (Rate)
09/2022	13.07.2022	Seeks to amend notification No. 5/2017- Union Territory Tax (Rate)
10/2022	13.07.2022	Seeks to amend notification No. 2/2017- Union Territory Tax (Rate)
11/2022	13.07.2022	Rescinds notification No. 45/2017- Union Territory Tax (Rate)

 

CGST Circular
Circular No.	Date of Issue	Subject
170/02/2022	06.07.2022	Mandatory furnishing of correct and proper information of inter-State supplies and amount of ineligible/blocked Input Tax Credit and reversal thereof in return in FORM GSTR-3B and statement in FORM GSTR-1
171/03/2022	06.07.2022	Clarification on various issues relating to applicability of demand and penalty provisions under the Central Goods and Services Tax Act, 2017 in respect of transactions involving fake invoices.
172/04/2022	06.07.2022	Clarification on various issue pertaining to GST
173/05/2022	06.07.2022	Clarification on issue of claiming refund under inverted duty structure where the supplier is supplying goods under some concessional notification.
174/06/2022	06.07.2022	Prescribing manner of re-credit in electronic credit ledger using FORM GST PMT-03A.
175/07/2022	06.07.2022	Manner of filing refund of unutilized ITC on account of export of electricity.
176/08/2022	06.07.2022	Withdrawal of Circular No. 106/25/2019-GST dated 29.06.2019.
177/09/2022	03.08.2022	Clarifications regarding applicable GST rates & exemptions on certain services
178/10/2022	03.08.2022	GST applicability on liquidated damages, compensation and penalty arising out of breach of contract or other provisions of law
179/11/2022	03.08.2022	Clarification regarding GST rates & classification (goods) based on the recommendations of the GST Council in its 47th meeting held on 28th – 29th June, 2022 at Chandigarh

 

 

Maharashtra Goods and Services Tax Act, 2017 (MGST) Notification
Notification No.	Date of Issue	Subject
No. JC(HQ-5)/DC-2(A&R)/MGST Noti-State Tax/2022/ADM-8 Notification No.10/2022 – State Tax	21.07.2022	Seeks to Exempt taxpayers having AATO upto Rs 2 Crores from the requirement of furnishing annual return for FY 2021-22

 

Maharashtra Goods and Services Tax Act, 2017 (MGST) Circular
Circular No.	Date of Issue	Subject
02 T of 2022 CBIC circular no. 170/02/2022-GST	22.07.2022	Mandatory furnishing of correct and proper information of inter-state supplies and amount of ineligible / blocked input tax credit and reversal thereof in return in Form GSTR 3B and statement in Form GSTR 1
03 T of 2022 CBIC circular no. 172/04/2022-GST	22.07.2022	Clarification on various issue pertaining to GST
04 T of 2022 CBIC circular no. 173/05/2022-GST	22.07.2022	Clarification on issue of claiming refund under inverted duty structure where the supplier is supplying goods under some concessional notification.
05 T of 2022 CBIC circular no. 174/06/2022-GST	22.07.2022	Prescribing manner of re-credit in electronic credit ledger using Form GST PMT – 03A
06T of 2022 CBIC circular no. 175/07/2022-GST	22.07.2022	Manner of filing refund of unutilzed ITC on account of export of electricity.
07 T of 2022 CBIC circular no. 176/08/2022-GST	22.07.2022	Withdrawal of circular No 106/25/2019-GST dated 29.06.2019.
08 T of 2022	26.07.2022	Placing draft Form GSTR 3B document in public domain for seeking inputs or suggestions of the stakeholders

 

Maharashtra Goods and Services Tax Act, 2017 (MGST) Notification
Instruction No.	Date of Issue	Subject
No.VAT/1522/CR32/Taxation-1. dt. 14 july 2022	14.07.2022	Change in rate of VAT on Petrol & Diesel

 

INCOME TAX UPDATES By CA. Ajay Talreja

 

Say no to Cash Transaction- Benefits of Cashless Transactions

We were told by history that before advent of cash there was concept of barter system. In barter system, where there was no currency ‘no cash’ and things were exchanged according to needs and sooner society realized that barter system having its own series of advantages and disadvantages need to be left behind with time and later on various personalities, kings and governments introduced new coins and currency made from time to time making impressions of their choice on such coins.

DIFFERENT STAGES OF EVOLUTION OF MONEY

1) COMMODITY MONEY OR BARTER SYSTEM When different commodities were used as a medium of exchange

2) METALIC MONEY The first coins were made of an alloy of silver and gold. In China, gold coins were first standardized during the Qin dynasty (221-207 BCE)

3) PAPER MONEY Paper money were first used by the Chinese, who started carrying folding money during the Tang Dynasty (A.D. 618-907)

4) CREDIT MONEY Credit money is any future monetary claim against an individual that can be used to buy goods and services

5) ELECTRONIC MONEY Digital currency is a type of currency available in digital form. These coins were also left behind after independence and baton was passed onto a new series of coins and currency. Its advantages were so overwhelming that disadvantages penetrated into the economy deeply and the crisp and clean notes soon turned into “BLACK MONEY”. Many schemes were introduced to dig out black money and many factors were responsible for widening of its feet in every nook and corner of the system. The question is “Why Black money is so bad”, there is a proverb which goes like, “thief leaves behind some sort of evidence after theft” but cash is wittier than this thief it does not leave behind any trail of its source of origination, whether it comes from a legal source or not, or whether taxes have been paid on it or not, etc. These problems have given birth to the need of cashless economy.

WHY CASH IS LIKED BY MOST OF THE PEOPLE?

It improves buying ability as it doesn’t require any authorization for the person who is carrying it. Transactions are much faster and hassle free. There are not transaction charges as well. So we end up paying the exact amount. It can be kept as reserves which can be used easily at the time of crisis. It is easy to carry. No dependency on any hardware. Cash is the anonymity and the lack of a transaction record. Tax evasion becomes easier Cashless Economy is not possible since cash to economy is like what blood is to human body, it will standstill, government can introduce various ways to restrict its usage thus reducing after effects of cash transactions but it cannot pull it out of the system and throw away in an instant. Moving further let us understand what is a Cash Transaction? In lay man language, a financial transaction with immediate exchange involving physical money and not soft money. For instance I went to a Showroom bought a watch for Rs.50,000/- and paid through debit card it is not a cash transaction since it involved payment through banking channel but if I had paid through hard physical money, the cash element has come into picture and thus the transaction is a cash transaction and then the legal consequences follow, that my information will be sent to Income Tax Department or not depending on the size of transaction or whether I will have to give my PAN to seller, etc. which we will see in detail in the upcoming chapters. But the best way to reduce corruption and black money in the economy is to move from an informal economy predominantly dependent on cash, to electronic transfers. This will require universal banking accessibility.

FLAWS IN CASH TRANSACTIONS

BLACK MONEY AND CORRUPTION–In India, black money is funds earned on the black market, on which income and other taxes have not been paid. Also, the unaccounted money that is concealed from the tax administrator is called black money. The black money is accumulated by the criminals, smugglers, hoarders, tax-evaders and other anti-social elements of the society. IN OTHER WORDS Black money is that quantum of income which was not disclosed to government and hence no tax was paid, although the source is legal. Black money becomes white and legal if tax and penalty at the prevalent rate is paid. Corrupt money is the money obtained by bribes. The source is also illegal and it can’t become legitimate by paying tax. IMPACT OF CASHLESS TRANSACTIONS ONCORRUPTION No corruption, No Black Money: Through cashless transactions, details of every transaction is maintained. Payments done by every individual can be easily traced. No fake Money: One of biggest advantage would be totally eliminating fake currency. Ensures Payment of taxes: As every single penny you own is counted, so it will be difficult to evade taxes.

SOME ADVANTAGES OF CASHLESS TRANSACTIONS

1. The first and foremost advantage of cashless economy is that an individual does not need to carry cash with him or her everywhere which in turn reduces the chances of theft from wallet, reduces inconvenience due to carrying cash, give freedom from problem of change when transaction is of odd amount, no risk of receiving counterfeit currency and so on.

2. 2. Another benefit of cashless economy is that it is easier to track the black money and illegal transactions because if cash is used directly for doing transactions then it is not easy to track the transactions as the money does not come into the banking system. However in case of digital transactions, it is easy to track the transaction as all records are there with the banks which result in more transparent transactions which in turn lead to fall in corruption in the economy of the country. 3. Another advantage of cashless economy is that since all transactions will be done through organized channel that is through banks and financial institutions it results in increase in tax revenue for the government as all cash transactions which were done illegally come into banking system which in turn helps the government in tracking all transactions and levying tax on them which in turn can be used by the government for betterment of economy of the country. In a bid to curb black money as well as to limit the number and amount of cash transactions, the government has come out with some new provisions and related rules and prohibited some types of cash payments in the Finance Acts. E.g sec 269ST has been inserted by Finance Act, 2017 which aims to restrict cash transactions of Rs. 2 Lakhs or above. It is irrelevant whether the person receiving the specified sum in cash is assessed to income tax or not. It is also irrelevant as to what is his source of income e.g salary, rent, business, agricultural income or any exempt income. The restrictions would apply to receipt of fees by educational institutions, hospitals and to donations by temples etc. It would apply to transactions between two related persons or between such persons – where both the payer and the payee are exempt from payment of tax. In a lighter vein, it may be stated that even if a husband pays specified amount of cash to his wife for household expenses, the receipt in the hands of the wife would be covered by the impugned restrictive provision.

3. The effects of other restrictions under provisions of income tax act are as follows: Restrict cash transactions which results in disallowances of expenses or deductions under chapter VIA of Income Tax Act, 1961 in computation of taxable income and allowing deduction to provide incentive for better compliance. Penalizing cash transactions above threshold limit to create effective deterrence.

 

 

DGFT & CUSTOMS UPDATE By CA. Ashit Shah

 

1. Notifications issued under Customs Tariff:

Notification No.	Remark	Date
38/2022	Exemption from Basic Custom Duty (BCD) and Agriculture Infrastructure Development Cess (AIDC) on import of raw cotton covered under HSN 5201 up to 31st October 2022.	04-07-2022
39/2022	There is no change in the applicable BCD rate of 5% for Open cell (15.6″ and above) for use in the manufacture of LCD and LED TV Panels of heading 8524.	12-07-2022
41/2022	Exemption from BCD is extended when defence related goods / equipment’s are imported “Ministry of Defence or the Defence forces, or the Defence Public Sector Units or other Public Sector Units. Now the exemption is also extended on imports the goods / equipment by “any other entity”.	13-07-2022
42/2022	IGST exemption withdrawn on research equipment’s imported by institutions or universities.	13-07-2022
43/2022	Tariff Rate Quota (TRQ) holders to import gold through IIBX under TRQ mechanism of India-UAE CEPA.	20-07-2022
44/2022	Concessional rate of tax – Agriculture Infrastructure and Development Cess (AIDC) on import of Mosur up to 31st March 2022	23-07-2022

 

2. Circulars issued under Customs:

Circular No.	Remark	Date
10/2022	Clarification of concessional rate of duties on Chemiluminescence Immuno Assay (CLIA) kits.	25-07-2022
11/2022	Extension of Customs clearances beyond normal working hours in Inland Container Depot(s).	29-07-2022

 

3. Notifications under DGFT:

Notification No.	Remark	Date
16/2015 – 20	Exemption of IGST and Compensation Cess under Advance Authorization Scheme, EPCG Scheme and EOU Scheme is provided.	01-07-2022
15/2015 – 20	Last date for submission of applications under MEIS for exports made in the period 01-9-2020 to 31-12-2020 has been extended up to 31-08-2022	01-07-2022
17/2015 – 20	Import of Potatoes under ITC (HS) 0701 90 00, is allowed to be imported freely from Bhutan without import license up to 30th June 2023.	04-07-2022
18/2015 – 20	Export Policy of wheat flour (atta) remains ‘Free’, but export shall be subject to recommendation of Inter-Ministerial Committee (IMC) on export of wheat.	06-07-2022
19/2015 – 20	Requirement of advance registration of minimum 15 days from the expected date of arrival of import consignment under SIMS has been abolished.	07-07-2022
22/2015 – 20	Import of Human Embryo under ITC 05119999 is kept under “prohibited” in accordance with the Assisted Reproductive Technology (Regulation) Act, 2021 and The Surrogacy (Regulation) Act, 2021.	20-07-2022

 

CHARITABLE TRUSTS UPDATES By Adv. Hemant Gandhi & CA Premal Gandhi

 

Accumulation of Income Of Charitable Trust – Challenges in Filing of Incorrect or Inaccurate Filing of Form 10

Under section 11(2), the assessee can accumulate unutilized income in excess of 15 per cent of the income by applying to the Assessing Officer for such permission and by adhering to various conditions specified under the section, which is reproduced as under:

‘(2) Where eighty-five per cent of the income referred to in clause (a) or clause (b) of sub-section (1) read with the Explanation to that sub-section is not applied, or is not deemed to have been applied, to charitable or religious purposes in India during the previous year but is accumulated c apart, either in whole or in part, for application to such purposes in India, such income so accumulated or set apart shall not be included in the total income of the previous year of the person in receipt of the income, provided the following conditions are complied with, namely:

(a) such person furnishes, a statement in the prescribed form and in the prescribed manner to the Assessing Officer which the income is being accumulated or set apart and the period for which the income is to be accumulated or set apart, which shall in no case exceed five years.

(b) the money so accumulated or set apart is invested or deposited in the forms or modes specified in sub-section (5);

(c) the statement referred to in clause (a) is furnished on or before the due date specified under sub-section (1) of section 139 for furnishing the return of income for the previous year:

Provided that in computing the period of five years referred to in clause (a), the period during which the income could not be applied for the purpose for which is so accumulated or set apart, due to an order or injunction of any court, shall be excluded.

Explanation.-Any amount credited or paid, out of income referred to in clause (a) or clause (b) of sub-section (1), read with the Explanation to that sub-section, which is not applied, but is accumulated or set apart, to any trust or institution registered under section 12AA (or Section 12AB) or to any fund or institution or trust or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or sub-clause (1) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10, shall not be treated as application of income for charitable or religious purposes, either during the period of accumulation or thereafter.’

Section 13(9) has been inserted w.e.f. 1/4/2016 and it provides. Nothing contained in sub-section (2) of section 11 shall operate so as to exclude any income from the total income of the previous year of a person in receipt thereof, if-

(i) The statement referred to in clause (a) of the said sub-section in respect of such income is not furnished on or before the due date specified under sub-section (1) of section 139 for furnishing the return of income for the previous year, or

(ii) The return of income for the previous year is not furnished by such person on or before the due date specified under section (1) of section139 for furnishing the return of income for the said previous year.

Hence, to claim the benefit of accumulation not only Form 10 needs to be submitted before due date but in such case, Income Tax return should also be submitted before due date. It may be noted that section 13(9) applies only in case of submission of Form 10 and does not apply in case of submission of Form 9A.

Though only Form 10 is required to be uploaded, the following documents and details should be prepared and preserved for accumulation:

(1) A resolution has to be passed by the governing body of the organisation and such resolution has to be filed with the Form 10.

(2) Copies of the annual accounts of the organisation along with the details of investment and utilization, if any, of the money so accumulated or set apart have to be furnished before the Assessing Officer before the expiry of six months commencing from the end of each relevant previous year.

Hence it brings us to a critical challenge that can a Form 10 be filed with vague details of accumulation, or does it need to be very specific in nature?

Form 10 clearly provides that the list of the objectives for which funds are required to be accumulated has to be disclosed specifically in the form itself. It would not be sufficient if a general list specifying all the activities of the organisation is filed along with Form 10. In DIT (Exemption) v. Trustee of Singhania Charitable Trust [1993] 199 ITR 819, the Calcutta High Court held that the objects of the trust could not be listed as a purpose of accumulation, because if this was allowed then the requirement for specifying the objects for accumulation would become meaningless. It is the duty of the assessee to inform specific purposes for which income is being accumulated. In the aforesaid case, the assessee listed out 16 objectives for which the funds were accumulated. These objectives were the general objectives of the trust as per the trust deed. The Court held that section 11(2) and Form 10 did not intend to entertain vagueness with regard to the purpose of accumulation. There has to be specific and concrete reasons for accumulation.

However, there are certain supreme court judgements to support the claims of the assessee and to ensure that the entire accumulation does not become taxable merely due to procedural lapses in filing of the form.

The Supreme Court of India in the case of CIT(Exemptions) v. Bochasanwasi Shri Akshar Purshottam Public Cable Trust [2019] 105 taxmann.com 97/263 Taxman 247 dismissed the SLP and upheld High Court order holding that lack of declaration in Form No. 10 regarding specific purpose for which funds were being accumulated by assessee-trust, would not be fatal to exemption claimed under section 11(2).

The Supreme Court of India in the case of CIT v. Gokula Education Foundation [2017]81 taxmann.com 372/248 Taxman 13, dismissed the SLP and upheld that as long as objects of trust were charitable in character and purpose or purposes mentioned in Form No. 10 were for achieving objects of trust, merely because details were not furnished, assessee could not be denied benefit of exemption under section 11(2)

Though there are supreme court decisions which could be help to the assessee, however they cannot be used as precursor for not filing or filing incorrect or inaccurate particular in the form. The assessee should take utmost precaution in filing of the forms as rejection of the same could lead to huge penal consequences which can be avoided.

 

 

THE NEED OF FINANCIAL KNOWLEDGE TO GUIDE TEENAGERS By Mr. Tushar P. Joshi

 

PATH OF RETIREMENT

Retirement planning is one of the most important aspects of financial planning. The fundamental goal of retirement planning is to achieve financial independence during your retirement years. The other important aspect in retirement planning is to be able to maintain your current lifestyle even during your retired life. Retirement planning is very structured process, the first step of which we can estimate, how much corpus we need at the time of retirement to sustain our current lifestyle. The next step of the retirement planning process is to determine, how we will build up the retirement corpus.

There are two factors that are critical in determining how much we need to save, to build our retirement corpus. These two factors are:

1) Our time horizon to retirement

2) Our risk tolerance, which is linked with our time horizon

Retirement Planning: Calculating your needs, retirement planning is a dynamic process. You should revisit retirement planning periodically to ensure that your retirement plan is on track and aligned with the factors discussed above, at that stage of your life.

Time Horizon to Retirement

As with most of the things in life, starting early have great benefits. The earlier you start, the better are the chances for creating wealth as you get more time to earn higher returns on your investments. This is known as the compounding effect. However, most people do not follow this and start investing when they are married or have kids without realising that they are already late.

Risk Tolerance

Risk tolerance is another important factor in your retirement planning process. Risk and returns are directly correlated. The more risk you take, higher the returns. Your asset allocation will depend upon your risk tolerance level, and that will ultimately determine your return on investment. At the cost of repetition, we should remember that, equities as an “asset class” give much higher returns when compared to other asset classes. Equities are also more risky, compared to other asset classes. Risk tolerance is a function of the investment horizon. If you have a long time horizon, you can hike out the volatility associated with equity investing. On the other hand, if you have a shorter time horizon, then you need to be more conservative, with regards to your asset allocation.

1. Low Risk Tolerance: Time Horizon Less Than 5 years

2. Medium Risk Tolerance: Time Horizon between 5 and 15 years

3. High Risk Tolerance: Time Horizon More Than 15 Years

Here, we have to decide as to how much we need to save to meet our retirement needs. The earlier we start saving for retirement, the easier would be the task. Due to the effect of compounding. We should give a lot of careful consideration to retirement planning. Retirement is an important phase of life. By planning for it, we can make retirement period the golden years of our life.

“Right now you are the pilot of your family and on your shoulder, the responsibility of ensuring the family members reach their destinations that each of them are dreaming of. I can assure you one thing that it is not just now, but forever, even at the age of 70 or 80 you will continue to remain the pilot and will never become a passenger for others to help you enjoy the flight as a pilot.”

Retirement Planning – The earlier You Start, the more you can save.

 

 

UPDATES ON FINANCE Compiled by CA. Pratik B. Satyuga

 

Highest 1 Year FD Rates (As on 01st August 2022) < Rs 2 Crore.

Institution	1 Year FD Rate
Indusind Bank	6.00%
Yes Bank	6.00%
Equitas Small Finance Bank	6.00%
RBL Finance Bank	6.50%
Jana Small Finance Bank	7.00%

Note : Senior Citizens would generally get 0.50% more than the above mentioned rates.

 

Post Office Deposit Rates (As on 01st August 2022).

Particulars	Rate of Interest	Maximum Deposit (Rs)
Post Office Saving Account	4.00% p.a.	No Limit
National Saving Recurring Deposit Account	5.8% p.a. (QuarterlyCompounded)	No Limit
National Saving Time Deposit Account	5.5% p.a. (Upto 3 Yrs)	No Limit
Senior Citizen Saving Scheme Account (SCSS)	7.40% p.a.	1,50,000/- p.a.
Public Provident Fund (PPF)	7.1% p.a. (Annually Compounded)	1,50,000/- p.a.
National Savings Certificates (NSC)	6.8% p.a. (Annually Compounded)	No Limit
Kisan Vikas Patra (KVP)	6.9% p.a. (Annually Compounded)	No Limit
Sukanya Samriddhi Accounts	7.6% p.a. (Annually Compounded)	1,50,000/- p.a.

 

Lowest Home loan Rates for Self Employed Professionals (As on 01st August 2022).

Institution	Rate
HDFC Bank	7.65% onwards
Indian Bank	7.55% onwards
Kotak Mahindra Bank	7.50% onwards
HSBC Bank	7.44% onwards
Union Bank of India	7.40% onwards

 

Top Performing Mutual Funds (As on 01st August 2022).

Fund Name	Current NAV	1 Year Returns
Invesco India Infra – Direct (G)	31.58	9.00%
Axis Small Cap Fund – Direct (G)	67.53	10.48%
Invesco India Infra –(G)	31.58	9.00%
Axis Small Cap Fund (G)	60.44	8.81%

 

Major Currency Rates (As on 01st August 2022).

Country	In Rs. on 01/04/22	In Rs. on 01/07/22	In Rs. on 01/08/22	Change MoM (Rs)	YTD Returns
United States of America (USA) – USD($)	75.99	78.95	78.65	-0.38%	3.50%
United Kingdom (UK) – GBP (₤)	99.61	95.50	96.05	0.58%	-3.57%
European Union (EU) – Euro (€)	86.32	82.34	80.50	-2.23%	-6.74%

 

Major Commodity Rates (As on 01st August 2022).

Commodity	Rate on 01/04/22	Rate on 01/07/22	Rate on 01/08/22	Change MoM	YTD Returns
Gold (MCX) – 10 Gms	64,700.00	51,520	51899	0.74%	-19.79%
Silver (MCX) – 1 Kg	68,153.00	58,418	58000	-0.72%	-14.90%
Crude Oil (MCX) – 1 Unit (BBL)	7,483.16	8,387	7371.19	-12.11%	-1.50%

 

Indian Indices

Index	1st April 2022	1st July 2022	1st August 2022	MoM Returns	YTD Returns
Sensex (BSE)	60,157.92	52,863.34	57823.10	9.38%	-3.88%
Nifty 50 (NSE)	17,903.25	15,703.70	17243.20	9.80%	-3.69%
Bank Nifty	38,141.20	33,264.75	37637.95	13.15%	-1.32%

 

Global Indices

Index	1st April 2022	1st July 2022	1st August 2022	MoM Returns	YTD Returns
Dow Jones (USA)	34,740.89	30737.77	32755.71	6.57%	-5.71%
Nasdaq (USA)	14,269.53	11006.83	12877.04	16.99%	-9.76%

Disclaimer : Utmost care has been taken to present accurate figures. However, the reader is advised to verify the same and consult a Financial Advisor before taking any financial decision.

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GSTPAM News Bulletin Committee for Year 2022-23

Ashit C. Shah Chairman

Sunil D. Joshi Jt. Convenor

Aloke R. Singh Jt. Convenor

 

The opinions and views expressed in this Bulletin are those of the contributors. The Association does not necessarily concur with the opinions/views expressed in this Bulletin.