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5 New Skills Every Business Owner Must Learn

Skills & Productivity

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May 10, 2023

Learning new skills is extremely important when it comes to business. As a business owner if you can not learn you can not grow. Business owners who are proactive about learning and growing grow much faster compared to others. If you are a business owner and wanted to know which new skills you should learn this post is for you. In this post, I will share 5 New skills that every business owner must learn.

5 New Skills Every Business Owner Must Learn

#1 Master the capability of content marketing

The first skill which is becoming a necessity for every business owner today is to Master the capability of content marketing. Whether you are a B2B business or a B2C business doesn’t matter. Today content is king. Content is the easiest way to grab customer attention, establish credibility and create curiosity about your product and services.

As a business owner if you are not learning skills of creating content and marketing then you are not going to withstand competition. The usage of the internet is growing and people are consuming content on the internet like anything. By doing content marketing you can be in front of your customer and get more business.

#2 Understanding How to Leverage AI Tools

AI – Artificial Intelligence is a new trend. As a business owner, you need to understand how to leverage AI tools for business benefits. If today as a business owner if you don’t have a basic understanding of AI, you will be thrown away by your competitors.

AI brings endless opportunities for business owners. You need not to be tech-savvy to use AI. You just need to yourself in which department you can implement AI tools that can minimize your input and maximize output. Artificial intelligence is going to become a core capability for every business owner in the next few years so make sure you learn AI as early as possible.

#3 Digital Marketing & Advertising

Digital marketing & online advertising are extremely important skills for the business owner. As a business owner, you should know how to market your product or services to generate leads. You can make use of digital marketing and paid advertisements to generate a lead pipeline and you will be able to grow your sales.

We live in the Internet era and the online advertisement industry is growing like anything. If you don’t know digital marketing and online advertisement you can hire a digital marketing agency for your business.

#4 Data Analysis & BI

Data Analysis & BI (business intelligence) is next on the list of new skills that every business owner should learn. When it comes to a business lot of data gets generated in every department. The data generated should be analyzed using business intelligence skills. PowerBI is a business intelligence software that is used to make dashboards. Dashboards offer very good visualization business owners can make use of this visualization for making business decisions. Finance dashboards, Sales dashboards, and customer feedback dashboards are a few examples of dashboards. As a business owner, one should learn data analysis skills so that business decisions can be taken effectively.

#5 System Skills

As a business owner, you should know how to design systems for every single function of your business. Your business should be system and process-driven and should not be people people-dependent business. Most business owner thinks that systems cost money and system slow down things that is not true.

The system does not equal automation and technology solutions. System equals having predictable patterns that can give you predictable results in every single department. You should learn system skills so that your business can withstand and run independently without relying on specific people in auto-pilot mode.

Final Words

So these are 5 new skills that you need if you are serious about building something that can be scaled up and something that will turn into a successful business.

Sending Money at Foreign – Tax Collection at Source Increased from 5% to 20%

Incometax

Shitanshu Kapadia

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May 9, 2023

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Sending Money at Foreign Cost You More. Parents have to shell out more money for sending kids abroad to study. Tax Collection at Source (TCS) for Foreign Remittance is about to grow to 20% from the current 5%.

The Union Budget 2023 proposed to increase Tax Collection at Source (TCS) on Foreign Remittances under LRS (Liberalised Remittance Scheme) from 5% to 20%. The TCS rule is applicable to foreign trips, sending money abroad, and other personal remittances, except for education and medical purposes. This means money sent by parents for living and other essential expenses will now face a TCS of 20%. This new rule will come into effect from Jul 1, 2023. Before the said changes, 5% TCS was applicable on Foreign Remittances above ₹7 Lakhs in a Financial Year.

At present, under LRS, remittances made for foreign education, via an education loan paid abroad, attract a TCS of 0.5 percent for the amount transferred beyond Rs 7 lakh. This will not change going forward either. However, if the source of funding is not an education loan, then money remitted overseas even for education attracts TCS at 5 percent if the amount is above Rs 7 lakh.

Key changes for Tax Collection at Source

Remmitence using Education Loan under Section 80E

If the amount being remitted overseas is a loan obtained from any financial institution as defined in Section 80E. 0.5% of the amount or the aggregate of the amount over ₹7 lakhs in a Financial Year.

Remmitence For Education and Medical

If remittance is for education & medical in that case 5% of the amount or the aggregate of the amounts over ₹7 lakh in a Financial Year.

Remittance for Overseas tour package

Earlier this limit was 5%. This means that ₹5 lakh equivalent of the tour package will incur a TCS of ₹25,000. Once a new rule is applicable this limit is changed to 20%. This means that ₹5 lakh equivalent of the tour package will incur a TCS of ₹1,00,000.

Remittance for all other cases/ purposes

Earlier this limit was 5% of the amount or the aggregate of the amounts over ₹7 lakh. This means ₹10 Lakhs equivalent amount remitted will incur a TCS of ₹15,000. (TCS applied on ₹3 Lakhs, excess of the ₹7 lakh threshold limit @ 5%, will be ₹15,000.)

Now once the new rule is applicable limit is changed to 20% without any threshold limit. This means ₹10 Lakhs equivalent amount remitted will incur a TCS of ₹2,00,000. (Flat 20% TCS will be applicable for all other purposes except Education and Medical.)

In case parents want TCS at 5% they need to provide proofs for education expenses.

Please note that TCS is not a tax by itself. It is just tax paid on the transaction. This TCS can be adjusted against the tax liability of the taxpayer.

Example –

Suppose a taxpayer’s total remittance is Rs 100000. At a 20 percent rate, a TCS of Rs 20000 will apply to the amount. If his tax on the total income is Rs 50000, he has to pay only Rs 30000 and the rest Rs 20000 will be adjusted against TCS balance.

The taxpayer will get a deduction or refund at the time of filing the ITR. However, an increase in TCS means an impact on the cash flow.

How to Save Tax by Investing in Mutual Fund

Mutual Funds

Shitanshu Kapadia

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May 3, 2023

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Investing in mutual funds can be a great way to save tax. Mutual funds are an investment vehicle that pools money from many investors and invests it into stocks, bonds, or other securities. By investing in mutual funds, you can diversify your investments while minimizing risk. In addition, the taxes you pay on your investments can be reduced depending on the type of mutual fund you choose. This guide will explain what types of mutual funds are available and how they can help you save taxes when investing. It will also provide tips for maximizing your returns and reducing risk when investing in mutual funds. With this knowledge, you can make more informed decisions about your investments and enjoy greater financial freedom as a result. Ready to get started? Let’s dive in!

What are the Best Tax-Saving Mutual Funds?

When it comes to tax-saving mutual funds, there are many options available. Each type of fund has its own benefits and drawbacks, so choosing the right one will depend on your financial goals. Generally speaking, ELSS or Equity Linked Savings Scheme funds are one of the most popular tax-saving mutual funds. These funds invest mainly in equities, making them a high-risk but potentially rewarding choice.

Tax Benefits of Investing in ELSS

Investing in ELSS mutual funds can help you save tax under Section 80C of the Income Tax Act, 1961. You can claim annual tax deductions for investments up to Rs. 1,50,000. However, investments exceeding this amount will not be eligible for deductions.

If your total long-term capital gains from equity-oriented mutual funds or equity shares exceed ₹1,00,000 in a year, you will be subject to a 10% long-term capital gains tax on the returns generated from ELSS funds. If you choose the dividend option, the dividends you receive will be taxable, and the mutual fund will deduct TDS at a rate of 10% for resident investors and 20% (plus applicable surcharge and cess) for non-resident investors. However, when filing their annual returns, investors can claim a tax credit for the TDS deducted.

Therefore, ELSS funds can be considered as one of the best tax-saving investment options due to their high return probability and shorter lock-in period compared to other alternatives.

Things to Consider While Investing in ELSS

Goal Setting:

Before investing in ELSS, setting your goals and determining the right asset allocation is important. Do you want to invest for a short period, or are you looking at long-term investments? Answering these questions will help you decide on the right investment option.

Risk Tolerance:

While investing in mutual funds, it is important to consider your risk tolerance level. Mutual funds come with different risk profiles and returns, so make sure that you choose one which suits your needs and financial objectives.

Low Expense Ratio:

Mutual funds often have high expense ratios due to their management fees and other charges. It is important to look for a fund with a low expense ratio to maximize your returns.

Investment Period:

When investing in ELSS, it is important to consider the lock-in period of the fund. Generally speaking, ELSS funds have a three-year lock-in period, meaning you cannot redeem or sell your investment until the completion of this time frame.

How to Choose an ELSS Fund?

Research:

Do your research and familiarize yourself with the various ELSS funds available in the market. Read their performance history, expense ratio, and risk profile to better understand which will suit your needs best.

Compare Funds:

Compare different funds’ returns, expenses, and other factors before making a decision. Also, consider the past performance of different funds to get an idea of how they are likely to perform in the future.

Invest Wisely:

Once you have decided on a fund, begin by investing small amounts at regular intervals over a period of time. This is known as rupee cost averaging and can help minimize losses due to market fluctuations while maximizing returns from your investments.

The Bottom Line

By investing in ELSS funds, you can enjoy the benefits of tax savings while making potentially rewarding investments. Make sure to do your research before choosing a fund, and invest wisely to maximize returns on your investments. With the right strategy and disciplined approach, you can maximize your investment in ELSS funds. Good luck!

How Late Payments Affect Your Credit Score?

Personal Finance

Shitanshu Kapadia

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May 2, 2023

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Credit score reflects your creditworthiness and shows the lenders how reliable you are with credit. Credit bureaus give the highest weightage to your repayment history. This is why missed payments or late payments on your loans and credit cards will negatively affect your score. If you check your free credit score from any of the third-party platforms and go through the detailed credit report, you will find the ‘Days Past Due’ section on your report which is directly linked to late payments. How does it affect your score and your ability to avail new credit? Let’s find out.

What happens when your payment is late?

When you do not pay the minimum amount due on your credit card by the stated due date, it generally attracts late payment charges. Card issuers may also offer up to 3 days of grace period after the due date, in which case the late payments will start after you exceed the grace period.

The amount of late payment fee depends on the total balances that you are carrying on your card. For example, HDFC Bank charges Rs. 500 as late fee if your dues range between Rs. 501 and Rs. 5,000. However, if the dues are between Rs. 25,001 and Rs. 50,000, you will have to pay Rs. 1,100 as late fee.

Similarly, instalment debts like home loan, personal loan and car loan also offer some grace period after the due date. If you do not clear the dues for the month by the grace period, it will attract penalties.

How does a late payment show up on your credit report?

Late payments, whether on a credit card or a loan, show up in the days past due section of your credit report. This section indicates the number of days by which you have missed an EMI or credit card dues. If you have continuously made payments on time, the DPD section should show ‘000’ in all the months. However, say you missed your credit card dues for the last month by 25 days, the DPD section will be marked in red for the said month and show ‘25’ instead of ‘000’.

Sometimes, you can also see ‘XXX’ written in the DPD section. This is possible when the lender has not shared the payment records with the bureau and does not lead to a negative impact.

The DPD section contains your payment timeline for the past 36 months and helps the lenders check how regular you have been with clearing your dues. Occasionally missing payments for a few days might not influence your credit score as much as it would if you frequently miss credit card dues or loan EMIs.

How long do late payment stay on your credit report?

Late payments or any other negative markings stay on your credit report for seven years. However, it does not mean that your credit score will continue to be impacted for those seven years. If you continue to make future payments on time, your credit score should gradually improve. Also, as years go by, lenders will also not give as much importance to the previous late payments as they are more concerned with your recent credit history.

Consumers also wonder whether they can get a late payment removed from their credit report. However, it is not possible to do so. Such negative markings will stay on your report. Their impact, as said above, will reduce over time.

If late payment mistakenly shows up on your report, then you can raise a complaint with the concerned bureau to get it rectified. Such incorrect entries can also lead to a negative impact on your score but, when rectified, it should improve.

How to avoid late payments in the future?

The best way to improve your credit score and maintain an excellent score over time is to make disciplined use of your credit products and be regular with your payments. In order to stay on track with payments, you can:

Set up standing instruction on your account for automatic bill payments
Set up reminders on your calendar
Read your credit report regularly and get inaccurate information corrected
Spend only as much as you can afford to pay back on time
If possible, set aside some funds for emergency or unexpected expenses, which can also be used to cover bills that go out of hand

Occasional delayed payments do not have a major negative affect on your credit score. However, frequent delays and missed payments can be detrimental for your score and could also make availing new credit difficult for you. Hence, you must always clear your credit card dues and loan EMIs on time to build and maintain a good credit score.