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10 Ways to Convert Black Money to White

Money & Wealth

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September 1, 2014

Converting black money to white is very common today.

People use all illegal methods to convert black money to white. This article is written to expose ways that people use to convert black money to white. I do not encourage any taxpayers or anyone to use any of the below methods.

10 Ways to Convert Black Money to White

#1 Bogus Loan Entry

A popular method people use to convert black money to white is by showing bogus loan entries. Modus operandi, in this case, will be people give black money to friends or relatives and taking a cheque from them. This is a kind of bogus loan entry to convert black money to white.

In some cases, people give a repayment of this loan by giving back a cheque. People doing this must understand that the Income tax department is watching every transaction and tax payers have to prove the genuineness of every transaction.

#2 Formulation of Trust & doing Charity

Another popular way used by people to convert black money to white is by formulating trust for a social cause. They make executive bodies of own people in trust sometimes illiterate people like driver cook etc. They donate black money to this trust as charity to convert black money.

On paper it is charity but off the shelf, it is the conversion of black money to white.

#3 Showing Income as Agriculture Income

Another popular way of converting black money into white is by showing income as agricultural income. In order to show income as agricultural income you must possess the land and it must be used for agricultural purposes like plantation, garden nurseries etc.

However, there are various conditions you need to satisfy in order to claim agriculture income.

#4 Showing Cash Income from Profession

Another popular way to convert money to white is by showing income in cash. Income from tuition, professional fees, or commission is shown as cash by many taxpayers it is nothing but converting black money into white.

#5 Sale of personal belonging like Jewelry

Go to a known jeweler and give him all the black money you want to convert. He will give you a cheque for the same amount. He will also give you a purchase bill showing you sold your personal Jewelry to him. In this way, your Black money is converted to white and you need not pay capital gain tax even.

#6 Converting Black money by Investment

Another method people use to convert black money to white is by making investments in cash.

People purchase an insurance policy and pay premiums in cash. For example, if the insurance premium is 50000 Rs/- payable quarterly than people pay the first premium via cheque and rest of all premiums in cash. This is the most simple and popular way to convert money to white.

#7 Getting Black money as a gift

Another popular way to convert black money to white is by getting gifts from relatives. Modus operandi is simple you have black money and your relative has the same amount of white money. Your relative issues a cheque to you as a gift and you will give your black money to him/her.

#8 Depositing Black Money on the name of Family members

Another popular method for converting black money to white is to open a bank account on each and every individual family member. Deposit black money in the name of every family member to convert it in white.

#9 By Real Estate

Real estate is a sector where the majority of black money is parked. People use real estate deals to convert black money to white. It is observed that people do fake real estate deals exchange money and cancel these deals due to non-payment of money.

#10 By Declaring Black Money

The best method for converting black money to white as per me is by declaring this money to IT authorities and paying tax on this money to convert it to white.

Disclaimer –

I don’t recommend readers to follow any of these methods for black money conversion. This article is just for exposing loopholes in our system. So, RBI and the government can take appropriate action by formulating strict rules to remove black money from India. I am against black money and black money generation ideas.

If you have any information about people holding black money and trying to launder it. Please send an email to blackmoneyinfo@incometax.gov.in This email id will be monitored by a special cell and immediate action will be taken on information sent by you.

Let’s help the government to fight against black money and tax evaders.

If I have missed any other methods which people use to convert their black money into white money I request you to share them with our team.

Let’s fight against black money and corruption.

If you are true Indian and against Black Money and corruption share this post on Facebook and Twitter. Show your love and devotion to our Nation India.

10 Best Safe Investments in India

Investment

Shitanshu Kapadia

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August 23, 2014

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My friend Suresh is looking for a safe investment option. In the recent past he lost a couple of money in the stock market and now he wants to invest only in safe investment options.

I know many of you must be looking to grow your wealth without taking on too much risk. While high-risk options like stocks and cryptocurrencies may promise skyrocketing returns, they can also lead to massive losses. If you’re more inclined towards stability and security, there are plenty of investment options in India that offer consistent returns while keeping your capital intact.

In this guide, we’ll walk you through the 10 best safe investments in India that can help you secure your financial future. Whether you’re a risk-averse investor or just looking to diversify, these options are worth considering.

10 Best Safe Investments in India

Bank Fixed Deposit

Tenure – 7 Days to 10 Years

Expected Return – 6-8%

Tax Applicability – Taxable at investor slab

A fixed deposit from a bank is said as one of the best safe investments in India because as per the guidelines of RBI, the bank needs to take insurance of the deposit placed by you.

In fixed deposits rates of return are fixed and known, there is no uncertainty. Tax is applicable as per slab on FD to avoid TDS on FD you can submit form 15H/15G. You can download 15H/15G form from here.

Fixed deposit investment gives a moderate return and is best for small investors.

Recurring Deposit

Tenure – 6 Months to 10 Years

Expected Return – 7-8%

Tax Applicability – No TDS by Bank but interest is taxable at investor slab

A recurring deposit is a special kind of deposit where you need to deposit a specific amount at monthly intervals. In simple terms, it is making a fixed deposit every month. The return of a fixed deposit will be slightly higher than a fixed deposit as in a recurring deposit you are making investments in parts.

Also Read – Top 10 Long Term Investment Options in India

Tax Saving Fixed Deposit

Tenure – 5 Years

Expected Return – 7-8%

Tax Applicability – Amount for Investment is deducted from your taxable income up to 1 Lac (80 C). Tax is applicable on interest income.

Tax saving deposit is another form of safe investment. Tax saving fixed deposit is fixed deposit which you can use for tax saving. The drawback with tax saving fixed deposit is your money will be locked for 5 years.

PPF (Public Provident Fund)

Tenure – 15 Years

Expected Return – 7- 8.8%

Tax Applicability – Amount for Investment is deducted from your taxable income up to 1 Lac (80 C). Return in tax-free.

PPF is one of the safe investment option. PPF will give you very good return provided you wait for 15 years. No other fixed investment instrument can match return of PPF. Even return from PPF is tax-free.

MIS (Monthly Income Scheme)

Tenure – 5 Years

Expected Return – 7- 8.4%

Tax Applicability – Interest income is taxable

MIS is post office scheme suitable for retired employees/ Senior Citizens. You can invest from 1500 Rs/- to 4.5 Lakh in this scheme. It is safe investment option as Post office is directly managed by government of India. As name suggest interest income can be withdrawn by investor on monthly basis.

SCSS (Senior citizen saving scheme)

Tenure – 5 Years

Expected Return – 7-9%

Tax Applicability – Interest income is taxable, Investment amount is eligible for 80 C deduction.

Senior citizen saving scheme is for senior citizen only. Senior citizen can visit nearest post office or designated bank to open senior citizen saving scheme account. This scheme gives good returns but investment is allowed by senior citizen only.

NSC (National Saving Certificate)

Tenure – 10 Years

Expected Return – 7-8.8%

Tax Applicability – Interest income is taxable, Investment amount is eligible for 80 C deduction.

NSC is another safe investment with decent returns. NSC can be purchased from Post office.

FMP (Fixed Maturity Plan)

Tenure – 1 Year or more

Expected Return – Depends but yet comparable to fixed deposit

Tax Applicability – Interest income is tax-efficient

FMP is another form of safe investment. Compared to FD here insurance is not taken as capital protection and returns are not fixed but yet it is found that FMP gives better returns compare to FD. FMP falls in the category of mutual funds.

Debt Mutual Funds

Tenure – Variable

Expected Return – Not fixed

Tax Applicability – Tax on capital gain and dividend

Debt mutual funds are like FMP only, return in debt mutual funds is not fixed so if you don’t want any uncertainty this option is not for you. Debt mutual funds invest money in fixed investment instruments. Debt mutual funds are easy to buy and sell. In recent past debt mutual funds has given good returns.

Saving Bank

Tenure – No maturity

Expected Return – 4 -7%

Tax Applicability – No tax applicable up to 10,000 Rs/ interest

Savings bank is another safe place to place your money, especially emergency funds. Don’t place excessive money in saving bank consider another investment options like FD etc.

When it comes to investing, safety doesn’t mean compromising on returns. The options listed above offer security while helping you grow your wealth in a risk-free or low-risk manner. The key is to diversify your investments based on your goals and risk appetite. If you’re looking for tax-saving options, PPF and NPS are great choices. If regular income is your priority, SCSS and POMIS are ideal. Want long-term wealth creation? Debt mutual funds and government bonds are worth considering.

Pick the investment that aligns with your financial goals, and watch your money grow safely!

FAQs

1. Which is the safest investment option in India?

Fixed Deposits, PPF, and Government Bonds are among the safest investment options in India.

2. Can I get monthly income from any of these investments?

Yes, Post Office Monthly Income Scheme (POMIS) and Senior Citizens Savings Scheme (SCSS) offer regular income.

3. Are there any tax-saving safe investments?

Yes, investments like PPF, EPF, NPS, and SCSS provide tax benefits under Section 80C.

4. What is the best low-risk investment for beginners?

Fixed Deposits and Recurring Deposits are great low-risk options for beginners.

LIC Varishtha Pension Bima Yojana

Life Insurance

Shitanshu Kapadia

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August 14, 2014

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LIC of India new Varishtha Pension Bima Yojana will be launched on Independence Day 15^th Aug, 2014. Varishtha Pension Bima Yojana is guaranteed pension plan for senior citizen.

This pension yojana initiative is taken by government of India for the welfare of senior citizen of country. As per advertisement it is subsidize attractive pension scheme, with LIC as exclusive administrator. Let’s look at detail of this scheme.

LIC Varishtha Pension Bima Yojana

Eligibility – 60 years of age and above

Single Lump sum Premium –

Minimum Rs 66,665 (For Monthly pension)
Maximum Rs 6,66,6665

Pension –

Minimum Pension – Rs 500 per month
Maximum Pension – Rs 5000 per month

Benefit –

The pensioner will get pension during his entire lifetime

Assured return of 9% monthly (9.38% annually)
On demise of pension, Nominee receives pension price
Pension payment method – Monthly, Quarterly, Half Yearly, Yearly for life time

For more information refer to following poster by Government on Varishtha Pension Bima Yojana.

For More Information visit LIC Site.

10 Best Short Term Investment Options

Investment

Shitanshu Kapadia

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July 23, 2014

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My friend Shyam has excessive money and he is in search of a short-term investment option. He wants to get a quick return. Do you have excessive money? Do you want to invest this money for the short term? If yes you are at the correct place today we will be discussing about 10 best short-term investment options.

Short term Investment need

A short-term investment option is required when we have excessive money and there is a pressing expense expected shortly. Expenses could be anything but investment in good short-term investment would definitely increase the value of money.

Short-Term Investment Options

Fixed Deposit

Fixed deposit is the most popular investment option. FD is available with different tenures, starting from 7 days to 5 years. The interest rate varies of FD varies from 7% to 9.25%. Nationalized banks, Cooperative banks, and corporate FDs are a few lucrative investment options.

Saving Bank Account

Saving a bank account is a safe and very good short-term investment option. You must be thinking that savings banks will provide less interest 4% only but today you can earn up to 7% interest by placing your money in the savings bank. Few banks also offer higher interest on savings bank accounts.

Auto Sweep Account

Auto sweep provides the combined benefit of saving bank accounts and fixed deposits. An auto sweep account is a very good short-term investment option. Auto sweep account automatically converts the surplus amount of your account into a fixed deposit. In some cases, the penalty is applicable if FD under the auto sweep account is broken before 1 year.

FMP

A fixed maturity plan is a closed-ended debt scheme. FMP as the name suggests it has a fixed maturity date and fixed return. FMP is a low-risk risk high-return investment option. Investment in FMP also provides attractive tax benefits.

Liquid Funds

A liquid fund is a mutual fund that invests in money market instruments like term deposits, certificates of deposits, treasury bills, etc. You can liquidate money from a mutual fund in 24 hours.

Ultra Short-Term Funds

Ultra short-term funds invest in fixed-income instruments with short-term maturities. Ultra short-term funds provide good protection against interest rate risk. Some Good ultra-short-term investment funds are ICICI Prudential Ultra short-term plan and HDFC Ultra Short-term Bond Fund.

Certificate of Deposit

A certificate of Deposit is usually sold by the bank. The bank gives you the guarantee of returning the bank principal amount with interest. Premature withdrawal is not allowed in this option.

Equity Market Investment

Investment in the stock market is a risky affair, but it is a very good investment option for hungry investors. In the short term, you can gain good profit but sometimes you can end up making a loss also.

Mutual Funds

Mutual funds are also one of the risky investment options for the short term. If your investment horizon is for 1 year then you can invest in a good blue chip large cap oriented fund to get a good return.

Gold ETF

Yellow shining gold could be another option for short-term investment. As we know in recent past gold has given very good returns. Instead of investing in physical gold, you should invest in Gold ETF. Gold ETF investment provides good liquidity.

Before investing in any short-term investment option given above make sure you understand investment options in terms of associated risk and expected returns. Understand terms and conditions thoroughly before making investment.