How to cut down your loan load?

Efficiently cut down on your loan load

www.carajput.com;Loan

www.carajput.com; Loan

Borrowing is now without doubt one of life’s most critical constituents. We’ve all made use of it to tide over the financial crisis we face from time to time. But loans can also prove to be a burden, even when they’re repaid with interest and within a specified time period. However, one can effectively reduce the loan burden by managing properly and live lives which are essentially stress-free.

Go through the write-up and find some of the ways how smartly reduce your loan burden for yourself.

Option for reasonable EMI

www.carajput.com;cut down loan load

www.carajput.com; cut down loan load

When the borrower struggles to repay the monthly EMI then his credit score takes a beating that spoils his record and harms his potential borrowing chances. Hence, it is essential that he opts for reasonable  EMI     that can be easily repaid.  In order to learn about the EMI that you will have to pay on the loan that he is preparing to take,   you could request online EMI calculator assistance. This will help the borrower know the EMI that he will have to pay for and if he could afford it.

Increase the amount of repayment with raise in your income

www.carajput.com;INCOME

www.carajput.com; INCOME

  So if your price grows, then you are also needed to increase your monthly EMI amount. Doing this would ensure you complete your loan earlier than that of the specified period and are free to take care of those other valuable things in your life. If one has to clear more than one loan then he will manage to clear the highest interest loan. On the other hand, if you still have current debt from the credit card, you should first clear it.

A Wonderful idea to Refinance Presents

www.carajput.com;Refinance

www.carajput.com; Refinance

Refinancing or transferring a balance not only reduces interest but also actually reduces the loan burden. It means that one can pay off the existing loan with a new loan that can be acquired from the same or any other lender.

Refinancing can prove helpful in cases where the borrower has an ongoing loan that he has taken full advantage of at interest rates, unfavorable conditions, etc., whereas different lenders offer the same loan at good deals.

To opt for refinancing the borrower will have to apply for a transfer to balance with the new lender who will pay the money immediately to the previous lender who will then close his loan account while activating his new account with the new lender.

If possible then opt for pre-payment or part-payment

www.carajput.com;Prepayment and part payment

www.carajput.com; Prepayment and part payment

Prepaid and part-payment allow the borrower to pay off the amount of the loan as well as the interest before the specified time. Pre-payment of the loan decreases the outstanding principal amount and in turn reduces the EMIs.

On the other hand, times occur when the borrower has any surplus amount. He also will take advantage of this opportunity to pay parts of a home loan. These partial home loan installments bring down the principal amount and the EMIs and interest paid thereon.

Both pre and part payments are reducing the borrower’s big-time financial burden.

However, it is important to clarify whether or not the lender offers the pre- and part-payment facility at the very end.

Existing investments that  can also be used to repay debt

www.carajput.com;PPF

www.carajput.com; PPF

Borrowers can use the loan for repaying their debt against investments such as PPF, life insurance policy, etc. Here it would be worth recounting that the PPF permits the investor to take advantage of the investment loan from the third financial year which can then be repaid over the next three years. The maximum amount that can be used as a PPF loan can be up to 25 percent of the balance. The interest paid on borrowing is 2 percent higher than the average interest rate of PPF.

Unless one follows the above points then there can be no shred of doubt that he will be able to repay his loan on time without any hassles, and there will be no debt burden in his life.

Disclaimer: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. carajput.com is committed to helping entrepreneurs and small business owners to start, manage and grow their business with peace of mind. Our goal is to support the entrepreneur on legal and regulatory requirements and to be a partner throughout the entire business life cycle, offering support to the company at every stage to ensure that it is compliant and consistently growing. Hope the information will assist you in your Professional endeavors. For query or help, contact: info@carajput.com or call at 09811322785/4 9555 5555 480)

CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 29, 2016

CORPORATE & PROFESSIONAL UPDATE FEBRUARY 29, 2016

Untitled8

INCOME TAX ACT

SECTION 2(22)

DEEMED DIVIDENDS

Loans and advances to shareholders : Where assessees P and S were directors in two sister companies, namely AE and AI, and AI received Rs. 10 lakh as loan from AE, it would be treated as deemed dividend under section 2(22)(e) in hands of P and S in proportion to their shareholdings in AI – [2016] 190 (Delhi – Trib.)

SECTION 32

DEPRECIATION – ALLOWANCE/RATE OF

Plant : Expenditure incurred by assessee-AOP on acquiring trademarks, copyright and know-how of erstwhile firm would come within definition of ‘plant’ and, thus, assessee’s claim for depreciation in respect of same was to be allowed – [2015]  400 (SC)

SECTION 37(1)

BUSINESS EXPENDITURE – ALLOWABILITY OF

Legal expenses : Where erstwhile firm’s business was purchased as going concern by assessee-AOP formed by some partners of erstwhile-firm, legal expenses subsequently incurred by AOP for defending business of going concern and for protecting its interests were to be allowed as deduction under section 37(1) – [2015]  400 (SC)

SECTION 92C

TRANSFER PRICING – COMPUTATION OF ARM’S LENGTH PRICE

Comparables and Adjustments/Adjustments – Interest : Where extended credit period to A.E. for realisation of sale proceeds is directly related to and arising out of sale transaction, sale transaction with A.E. and resultant extended credit period for realisation of sale proceeds being two sides of a coin, are closely linked transactions, and, thus, transaction relating to extra credit period to A.E. has to be aggregated with sale transactions for determining ALP – [2016]  216 (Mumbai – Trib.)

Comparables and adjustments/Adjustments – AMP expensesWhere TPO applied bright line test to benchmark AMP transactions which was not valid in view of Sony Ericsson Mobile Communications India (P.) Ltd. v. CIT [2015] 374 ITR 118/231 Taxman 113/55 taxmann.com 240 (Delhi), matter was remanded to apply ratio of said case – [2016]  218 (Mumbai – Trib.)

SECTION 260A

HIGH COURT – APPEALS TO

Scope of : In absence of substantial question of law being framed, High Court can not upset final finding of fact arrived at by Tribunal – [2015] 400 (SC)

SECTION 268A

FILING OF APPEAL OR APPLICATION FOR REFERENCE BY INCOME-TAX AUTHORITIES

Circular No. 21/2015 : Where tax effect in appeals filed by revenue before Tribunal was less than Rs. 10 lakhs in each case, in view of instructions of CBDT Circular No. 21/2015, dated 10-12-2015 appeals so filed by revenue were to be dismissed as not maintainable – [2016] 189 (Pune – Trib.)

COMPANIES ACT

SECTION 108

TRANSFER OF SHARES – NOT TO BE REGISTERED EXCEPT ON PRODUCTION OF INSTRUMENT OF TRANSFER

Where there was no evidence on record to establish that share transfer deed was executed by petitioner transferring his shares, shareholding of petitioner in company was to be restored – [2016] 223 (CLB – New Delhi)

SECTION 284

DIRECTORS – REMOVAL OF

Where no special notice as per section 284(2) was given for holding EGM to remove petitioner as director of company, his removal was patently illegal – [2016] 223 (CLB – New Delhi)

SECTION 399

OPPRESSION AND MISMANAGEMENT – RIGHT TO APPLY

Petition for rectification of register of member alleging illegal transfer of petitioner’s share could not be challenged on ground of lack of required member of shareholding – [2016] (CLB – New Delhi)

SECTION 433

WINDING UP – CIRCUMSTANCES IN WHICH COMPANY MAY BE WOUND UP

Where there was no privity of contract between petitioner and respondent-company, and respondent had also not acknowledged its debt, it was not liable to make any payment to petitioner, hence petition for winding up respondent-company at instance of petitioner was not maintainable – [2016] (Gujarat)

COMPETITION ACT

SECTION 4

PROHIBITION OF ABUSE OF DOMINANT POSITION

Mere recruitment of pilots by an airline by another airline will not bring about structural changes in the operations of the market, rules CCI – [2016] (CCI)

SERVICE TAX

SECTION 65(25)

TAXABLE SERVICES – CLEARING AND FORWARDING AGENT’S SERVICES

Agents procuring orders and exploring potential customers for their principal are more appropriately classifiable under ‘Business Auxiliary Services’ and not under ‘Clearing and Forwarding Agent’s services’ – [2016] (Chennai – CESTAT)

CST & VAT

SECTION 11 OF GUJARAT VALUE ADDED TAX ACT, 2003

TAX INCIDENCE AND LEVY – TAX CREDIT

Where assessee purchased castor oil seeds for manufacture of castor oil and after crushing same obtained castor oil as well as deoiled cake (waste) and it used deoiled cake in furnace as a fuel in manufacture of castor oil, action of Assessing Authority in disallowing input tax credit for use of deoiled cake was not proper – [2016] (Gujarat)

CENVAT CREDIT RULES

RULE 9

CENVAT CREDIT – DOCUMENTS ON WHICH CREDIT MAY BE TAKEN

Where there is no dispute about receipt of material and payment of duty thereon, credit taken based on ‘endorsed bill of entry’ is valid – [2016] (Mumbai – CESTAT)

STATUTES

INDIRECT TAX LAWS (ST./EX./CUS. & (CST & VAT))

Delhi VAT -Framing of central assessments – CIRCULAR NO.38 OF 2015-16 [NO.F.3(636)/POLICY/VAT/2016/1463-69], DATED 18-2-2016

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact: info@carajput.com or call at 011-233 433 33

Disclaimer: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. carajput.com is committed to helping entrepreneurs and small business owners to start, manage and grow their business with peace of mind. Our goal is to support the entrepreneur on legal and regulatory requirements and to be a partner throughout the entire business life cycle, offering support to the company at every stage to ensure that it is compliant and consistently growing. Hope the information will assist you in your Professional endeavors. For query or help, contact: info@carajput.com or call at 09811322785/4 9555 5555 480)