Dalelorenzo's GDI Blog
7Aug/210

Who gets your EPF after you die is predecided

Most salaried men have Employees' Provident Fund( EPF) and Employees' Pension Scheme( EPS)( provisioned certain conditions are satisfied) accounts. Along with EPF, an individual is also covered under Employees' Deposit Linked Insurance( EDLI ). Nomination in EPF, EDLI and EPS details are governed by the Employees' Provident Fund& Miscellaneous Provisions Act, 1952. Under the Act, an EPF member can elect only those people who are defined as 'family' under the scheme.If you will your EPF and EDLI money to anyone other than the defined 'family' representatives, then the nomination performed in the arrangement would overrule the beneficiary mentioned in the will. The recipient of the EPF and EDLI cannot be anyone if the 'family' members as specified by the law is alive. Similarly, EPS cannot be bequeathed via will. If done, then interest will go as per the pension scheme supplyings and not to the beneficiary mentioned in the will made by an individual.Will or nominations: What happens if there is a mismatch? What happens if there is a mismatch in the campaigners mentioned in EPF account and beneficiaries mentioned in the member's will? "A will is defined under the Indian Succession Act, 1925 as "the legal statement of the intent of a testator with respect to his property which he desires to be carried into result after his death". Therefore, as the first step, it would have to be examined whether the concerned person has absolute title to the property that is sought to be disposed of. Members of the EPF/ EPS/ EDLI Scheme are bind by its terms - therefore, disbursement of stores would have to take place in accordance with the relevant scheme( notwithstanding the terms of a 'will') and the definition of 'family' as prescribed therein. By way of two examples, if a deceased male member elects his wife to receive EPF growths, the summarizes would be paid to her by the trustees , nonetheless, she will nurse it on behalf of the other 'family' representatives specified under the EPF( such as dependent parents) - nomination would not deprive them of their name to the EPF funds. It is unlikely that any other person mentioned in the will would get coin apart from defined 'family' members. In case of EPS, she will be fully entitled to receive the pension in the manner specified under the pension scheme - it's unlikely that a will be able to override this, " says Sowmya Kumar, Partner, Induslaw. 8416350 7Whom can you nominate under the EPF scheme? Under the programme conventions, an EPF member is impossible to select marriage, unmarried/ married children as well as dependent mothers as 'family' members who will receive funds in case of his/ her collapse. A female representative can also nominate her husband's dependent parents.Kumar says, "However, a female member can inform a Provident Fund Commissioner in writing of her desire to exclude her husband from the definition of 'family' - in this case, the partner and his dependent mothers shall no longer be part of 'family'. This shall be applicable for the purposes of EPF nomination."Do note that nominations that were filed for EPF and EPS before a representative is married become invalid once he/ she is married. After marriage, member of EPF and EPS is required to file the nominations again. Kumar says, "If a member fails to make a fresh nomination after matrimony, then any earlier nomination prepared would not be valid. In such a situation, EPF funds will be disbursed as follows:( a) it "il pay" equally to members of the 'family';( b) nonetheless, lads who have attained majority and married daughters whose partners are alive would not be entitled to this, if other 'family members' are alive( such as marriage or dependant mothers );( c) only in situations where there is no nomination and no 'family' will EPF stores be payable to the person legally entitled to it( for example, recipients under a will ). "Whom can you nominate under the EPS? In case of EPS, the definition of 'family' is limited to spouse and children. Amrita Tonk, Partner, L& L Partners( formerly known as Luthra& Luthra) says, "EPS specifically marks the widow and the children of the deceased hire to be entitled to receive the pension. It is a settled predicament of law that since the family pension is in the nature of a aid arrangement and would be payable to the widow and the children only upon the downfall of the employee, the same would not fall within the estate of the employee and therefore the same cannot be bequeathed by a will.""Only in cases where the member states "havent been" 'family'( i.e ., spouse or eligible children) will he/ she be entitled to nominate others( this can include biological mothers) in respect of the monthly pension. Furthermore, if honourable members dies left with no spouse/ eligible children, and there is no nomination, the widow pension shall be paid to the dependant father or the dependant mother. If the dependent parent receives the pension and subsequently transfers apart, the pension shall be payable to the surviving mother life long, " says Kumar.Nomination under EDLIIn case of Employees Deposit Linked Insurance( EDLI ), any nomination determined under the EPF Scheme will be applicable to the EDLI Scheme as well. The word 'family' under EDLI has the same meaning as that under EPF. Therefore, if there is no nomination, EDLI summing-ups will be paid to members of the 'family' in equal shares. "However, lads who have attained majority and married daughters whose partners are alive, would not be entitled to this, if other 'family members' are alive( such as spouse or dependant parents ), " says Kumar.Disclaimer: This article does not constitute legal advice. It is based on beliefs and answers acquired to specific questions from different legal experts. Case specific legal advice should be obtained independently before taking such action

Read more: economictimes.indiatimes.com

15Mar/210

How section 80C of the Income-tax Act works

One of the most frequent inferences accessible under the Income-tax Act, 1961 is section 80 C. The thinking under this section can be claimed only if an individual opts for the age-old/ existing charge government in a financial year. On the other hand, if an individual opts for the brand-new concessional charge regiman, then the individual will not be able to claim deduction under this section.Here is how this section directs and promotions an individual save levy in a financial year. 1. Through section 80 C, an individual or an HUF can reduce up to Rs 1.5 lakh from their gross total income in a financial year thereby reducing their net taxable income and tax payable thereon. Full utilisation of this rebate can save up to Rs 46,800( inclusive of cess at 4 %) for those in the highest tariff bracket of thirty %. 2. To claim this thinking, a taxpayer is required to invest the amount in eligible investment instruments or waste the money on certain specified deductible in the same financial year. The taxation payer can claim tax benefit under this section by investing/ expend up to Rs 1.5 lakh in certain specified streets under this section. 3. Eligible investment instruments include Employees' Provident Fund( EPF ), Public Provident Fund( PPF ), Equity-linked savings planned( ELSS) mutual funds, Sukanya Samriddhi Savings Scheme, National Savings Certificate( NSC ), five-year tax-saving tied lodges with a bank and/ or local post office, National Pension System( NPS ), and Senior citizen Savings Scheme( SCSS ). 4. Do keep in mind that each of the eligible investment has its own asset limit , pace of return, liquidity, and tax management on its returns. 5. Specified expenditures that are allowed under this section include expenditure on the life insurance premium, repayment of dean of a home loan, children's school fees.Also Read: All about levy savings for FY 2020 -2 1

Read more: economictimes.indiatimes.com