from the time since paypal changed indian regulations, every single cent spent is being taken into account for tax.

since you get all your online income directly into your bank, what sort of strategies you use to have the tax avoided to the most. share it?

Get a USA/UK PP acc and earn like a boss

Just but a USA verified PP account. use VPN to access it . Send it to your Indian PP when needed and use it for your online purchases.

Nice to meet you dude. As per my income Tax knowledge until you earn more than 1.6 lacs in an annual year u need not pay any tax...Any income above that threshold u gotta calculate ur tax for. However while transferring funds bank n paypal deduct thr fees.
Try having different family member accounts and use it wisely as simple as that. But if you start earning nice income you wont bother about tax Also invest in Govt PF's u get a rebate in ur tax and its good income after few years

that's a nice idea. have you tried it without any risks associated with it? how would you verify & cress the limits? any chance of getting banned? you opened my eyes

Originally Posted by SyZygy

Get a USA/UK PP acc and earn like a boss

Originally Posted by virtualc08

Just but a USA verified PP account. use VPN to access it . Send it to your Indian PP when needed and use it for your online purchases.

hehehe. my annual income is over 50 L's & working on improving it. PF's hehe, i'm 25 & don't want to invest in PF's now

Originally Posted by mahan_eesh

Nice to meet you dude. As per my income Tax knowledge until you earn more than 1.6 lacs in an annual year u need not pay any tax...Any income above that threshold u gotta calculate ur tax for. However while transferring funds bank n paypal deduct thr fees.
Try having different family member accounts and use it wisely as simple as that. But if you start earning nice income you wont bother about tax Also invest in Govt PF's u get a rebate in ur tax and its good income after few years

Also you can go for NSC as it gives major boost to ur tax benefit.
To be more black hat for saving plenty of your income (as u said iver 50lacs).. Open an NGO get section 80G and 35AC approved.. Be as a Donor to your own NGO via transferring paypal to Your NGO account. Enjoy the benefit.
PS: Use it on your own Risk

Or even better open a proprietorship and then you can claim your expenses and shit and reduce your tax...

i have been paying taxes fully all these days. could you explain these things in a way i can understand?

also, what abt the paypal ? have you tested it vc8?

Originally Posted by mahan_eesh

Also you can go for NSC as it gives major boost to ur tax benefit.
To be more black hat for saving plenty of your income (as u said iver 50lacs).. Open an NGO get section 80G and 35AC approved.. Be as a Donor to your own NGO via transferring paypal to Your NGO account. Enjoy the benefit.
PS: Use it on your own Risk

Originally Posted by virtualc08

Or even better open a proprietorship and then you can claim your expenses and shit and reduce your tax...

I don't get it. You earn 50L+ and still want to skip taxes? What else do you do? Run away from petrol pumps without paying for fuel? Don't pay for groceries and other utilities?

Regarding NSC...

National Savings Certificate is an assured return scheme and provides for tax rebates under section 80C. It pays interest at 8.4 per cent for a duration of five years and 8.7 per cent for 10 years, which is relatively lower compared to other small saving schemes. You buy NSC for a specific value and the interest compounded half yearly and returned along with the principal amount on maturity. NSCs have low liquidity and premature withdrawals can be done only under specific circumstances, such as the death of the holder(s), forfeiture by the nominee, or under court's order.

You get NSC in any post offices now a days and much worth it. you get that idea.

And if you still looking for alternate option to reduce your tax in India then

HTML Code:

http://www.itrust.in/content/tax-planning/How-Can-I-Save-Taxes-This-Year-India

If you are actually earning 50 L as you say why don't you consult with a CA/lawyer ( won't cost you much ) instead of asking on a BH forum.

This is not a tax advice forum.

lol to 50 L .if it would be real he would already have a ca by now.anyways long story short if u getting that amount show them as export of goods and ask your ca to show only a low profit margin and high turnover. and yes spreading the income in your family would decrease the tax burden

lol 50 L is nothing. Those who're saying " I don't get it ......" & staying at INDIA are you paying FULL 30% TAX. I bet never!

Here in india, people pay just less than 10 times what they should actually pay. My income is online so paying 15 L out of 50 L is foolishness.

I do have a CA, but he's not as much good in advising act saving. It's hard to find a CA who can save you good, but in an online forum people help very much & share their tactics. Let's share ideas instead of " I don't get it ..."

Buddy will you tell me how you making 50L? will you share your methode of making 50L?

bump...

Originally Posted by bilu4u

Buddy will you tell me how you making 50L? will you share your methode of making 50L?

I also want to know the same! Now its your turn!! Can you help us?? Tell the method so that we will earn the same way and see what tax problems come when we earn that much. And will advice you that time

Originally Posted by mahan_eesh

Nice to meet you dude. As per my income Tax knowledge until you earn more than 1.6 lacs in an annual year u need not pay any tax...Any income above that threshold u gotta calculate ur tax for. However while transferring funds bank n paypal deduct thr fees.
Try having different family member accounts and use it wisely as simple as that. But if you start earning nice income you wont bother about tax Also invest in Govt PF's u get a rebate in ur tax and its good income after few years

Thank you for providing information, I was also looking for the solution. :-)

50 L and asking for tax saving help, lol

@ OP on a serious note if you want to save the taxes let me tell you how you can do it.

As you told in your original post about Paypal so I believe you might be selling some kind of services (seo services as your forum names shows). If yes then I would advice you to NOT use paypal rather use third party payment processors like 2checkout/plimus/g2s etc. Ofcourse your clients can still pay you with their paypal.

Open various accounts under different names of your family members. Assuming you have 5 adults in your family you can divide 10L to every account. So now the income is coming from 5 different accounts ih 5 different names so less tax liability for you and you are doing nothing illegal. Provided upcoming IT regulations in India hopefully we don't really need to fill taxes up to 5 L per account so what you need to do is pay a mere of tax and rest show expenses like broadband connections, fuel, computer expenses etc.. there are a lot to be counted

This way you can save a lot of tax as well your money will be white. Hope it helps.

I am not from India but will be happy to share a Indian trick with you.
http://www.youtube.com/watch?v=HKnfseEmgwE

Pay your tax and help your country grow. There's more than enough money out there so that you don't have to worry about a few % on tax.

Originally Posted by BlueTurtle

Pay your tax and help your country grow. There's more than enough money out there so that you don't have to worry about a few % on tax.

What would you opt if the money you pay to govt is entirely getting robbed by corrupt politicians to fill their greed?

In India very few of like minded pplz would opt to pay taxes in full as ultimately they are not going to be invested for the betterment of our country rather personally used by corrupt politicians and secretly diverted to Swedish banks.

I earn more then what you mentioned. Hire a CA and don't think about avoiding taxes. Tax you pay would be useful for our country.

Do investments and other stuff that your CA suggest.

On other hand, if you just need to access blackmoney (want to avoid tax), tell the big clients to send money through western union. Only tell them to send below Rs 50,000. Each account has a limit of 10 transaction a year which goes un noticed. lets say you can get Rs 49,000 X 10 times = 4,90,000 Rs/year per person. You can scale it to your other family members.

^^ LOL inb4 your PM box get filled by noob queries how do you make more than 100K a year

hahahahaha 50 L .. who are you fooling .. you were earning that much your CA would have already told you what to do .. and you were not posting the query here ..

For all those people commenting "pay your taxes, help your country grow" you probably have no idea of the current political/economic situation of India.

The corruption here is alarmingly disturbing and paying 30% of your income to a government that provides little to no public facilities, security, and not even the most normal of things that even similar third world countries provide to their citizens without doubt.

Every day in India, political scams are uncovered and literally billions of dollars are found to be missing from money taxpayers have paid continuously year after year. Where is this money? Stashed away in private Swiss bank accounts of the most notorious politicians.

Statistical studies show that India has the most political black money stored off-shore. Way more than some of the top countries combined.

I could go on and on but the point is, avoid your taxes as much as possible if you're in India and pay only what you need to to get past the scanner.

What I recommend is:



For digital payments:

Use services like 2checkout.com, they allow you to store around $65,000 without having to withdraw it.

The beauty of it is you can make more accounts in your parents or spouse's names and store up to $65k in each which should be a great way to combat it all.



What do you do when you have to withdraw?


There are 2 ways to go about this:


1.) The short term hassle but long term convenience - SEZ Certification

2.) Short term simplicity but lack of convenience long term - Offshore Banking



SEZ Certification


This is basically a certification that signifies you operate in the IT industry mainly exporting software or digitized goods. This entitles you to tax free operation for the initial 5 years of setup and 50% tax discount for the following 5 years.

The problem here is, your office needs to be in an SEZ zone and you have to get SEZ approval which is one hell of a task but if you do manage to get it, you can declare all your earnings and not pay 1 cent of tax.



Offshore Banking

There are numerous countries like Belize, Seychelles, etc that allow foreigners to open tax free bank accounts. Some countries require a minimum deposit whereas others don't.

You can opt for one of these and transfer your US held funds there. Problem is, whenever you need to bring in money to India, if you're not an SEZ you can be taxed on it.



Bringing in Money - The Blackhat Way


Though many people may not know about this, you can bring your funds in without the Po-pos knowing a thing.

Talk to your CA, ask him to setup a system where you can wire funds to one of his SEZ clients or a similar tax free business. Then, when those funds arrive you get them in cash.

Some CA's may charge you a VERY NOMINAL fee for this but with most it should be free since the businesses get to retain foreign currency.

But keep in mind, this is as black as it gets and your earnings will always be cash so you won't be able to turn your money "white" i.e. account for it without paying tax.

Indians have been transferring money blackhat way for over a century. Your new generation folks probably have no idea about this.

Get offshore Paypal, wire money out of that Paypal to trusted indian person in offshore country. Get the money back to you by india "hawala" method.

Basically - your money gets paid to some guy in that country; he calls his guy in India; and that guys gives you money in cash.

All tax free, and easily done.

Meet a good tax consultant agency they will reduce tax.

use prepaid gift cards, is good way if you cant used some twist, green dot visa card.

Originally Posted by mahan_eesh

Nice to meet you dude. As per my income Tax knowledge until you earn more than 1.6 lacs in an annual year u need not pay any tax...Any income above that threshold u gotta calculate ur tax for. However while transferring funds bank n paypal deduct thr fees.
Try having different family member accounts and use it wisely as simple as that. But if you start earning nice income you wont bother about tax Also invest in Govt PF's u get a rebate in ur tax and its good income after few years

It has been increased to 2.2 lacs now.

what numers are you talking what is 50L ???

Get an accountant, He will help you show expenses and low profits so that you pay less tax. Paying Tax will benefit you in numerous ways in the future.

Don't go for fake pp accounts, you WILL suffer in the long term if you do that.

Originally Posted by seolabs82

lol 50 L is nothing. Those who're saying " I don't get it ......" & staying at INDIA are you paying FULL 30% TAX. I bet never!

Here in india, people pay just less than 10 times what they should actually pay. My income is online so paying 15 L out of 50 L is foolishness.

I do have a CA, but he's not as much good in advising act saving. It's hard to find a CA who can save you good, but in an online forum people help very much & share their tactics. Let's share ideas instead of " I don't get it ..."

ask your friends on a similar income scale, im sure someone would have figured this out.

but in essence this has to do with you claiming more expense than normal, splittin up accounts into your wifes/kids/parents/realiable unemployed cousins/brothers/sisters etc., ..

putting it all in one company/name is not good you will get audited eventually..



on a lighter note what you need is a bad ass tax advisor(lawyer) like the one in breaking bad

Originally Posted by UltraLink

For all those people commenting "pay your taxes, help your country grow" you probably have no idea of the current political/economic situation of India.

The corruption here is alarmingly disturbing and paying 30% of your income to a government that provides little to no public facilities, security, and not even the most normal of things that even similar third world countries provide to their citizens without doubt.

Every day in India, political scams are uncovered and literally billions of dollars are found to be missing from money taxpayers have paid continuously year after year. Where is this money? Stashed away in private Swiss bank accounts of the most notorious politicians.

Statistical studies show that India has the most political black money stored off-shore. Way more than some of the top countries combined.

I could go on and on but the point is, avoid your taxes as much as possible if you're in India and pay only what you need to to get past the scanner.

That's bullshit. I agree that the Congress has done it's share of scams, but that ain't any reason not to pay the taxes? Do you even know how much our country spends on other costs like the defence, etc? Say for example your child's school has a corrupt MLA as a trustee, would you skip the school fees? Have you stopped using the roads made my the government? That's the reason why our country is like this, even after 60 years. People want to skip taxes, abuse the government and then NOT VOTE. (Not directed to you but to others who skip taxes and don't vote).

Originally Posted by abrigado

what numers are you talking what is 50L ???

50L = 5 million INR = $100,000

Originally Posted by prateekm

That's bullshit. I agree that the Congress has done it's share of scams, but that ain't any reason not to pay the taxes? Do you even know how much our country spends on other costs like the defence, etc? Say for example your child's school has a corrupt MLA as a trustee, would you skip the school fees? Have you stopped using the roads made my the government? That's the reason why our country is like this, even after 60 years. People want to skip taxes, abuse the government and then NOT VOTE. (Not directed to you but to others who skip taxes and don't vote).

there are always pro and cons for this opinion :-)

how do you feel when you realise yu are a honest tax payer of which they take 30% of your hard earned income and provide you with bad roads, bad services, endless delays in any government approval AND not to forget the news of billion dollar scams by people in the government.. you begin to slowly think otherwise.. hey... if they can steal billions what is my little 10k going to do :P

its just a thought.. people do think both ways.. not saying one is wrong and the other is right ;-)

anyways to stay on topic and the OP s question you real best bet is to find someone in your income scale (friends/family) they might already be knowledgable in this perhaps guide you in showing more expenses or splitting up your income into different people s names like wife/kids/parents/brother/sister etc.,

that way you dilute the total earnings hence less taxes.

Originally Posted by dheer

What would you opt if the money you pay to govt is entirely getting robbed by corrupt politicians to fill their greed?

In India very few of like minded pplz would opt to pay taxes in full as ultimately they are not going to be invested for the betterment of our country rather personally used by corrupt politicians and secretly diverted to Swedish banks.

You can't teach an angry man to shed his anger by approaching him with anger.

Thank you so much. Is SEZ possible in INDIA?
I reside at Chennai, That's an SEZ Zone?
If possible do you mind giving me your skype( If im not troubling you )

Originally Posted by UltraLink

For all those people commenting "pay your taxes, help your country grow" you probably have no idea of the current political/economic situation of India.

The corruption here is alarmingly disturbing and paying 30% of your income to a government that provides little to no public facilities, security, and not even the most normal of things that even similar third world countries provide to their citizens without doubt.

Every day in India, political scams are uncovered and literally billions of dollars are found to be missing from money taxpayers have paid continuously year after year. Where is this money? Stashed away in private Swiss bank accounts of the most notorious politicians.

Statistical studies show that India has the most political black money stored off-shore. Way more than some of the top countries combined.

I could go on and on but the point is, avoid your taxes as much as possible if you're in India and pay only what you need to to get past the scanner.

What I recommend is:



For digital payments:

Use services like 2checkout.com, they allow you to store around $65,000 without having to withdraw it.

The beauty of it is you can make more accounts in your parents or spouse's names and store up to $65k in each which should be a great way to combat it all.



What do you do when you have to withdraw?


There are 2 ways to go about this:


1.) The short term hassle but long term convenience - SEZ Certification

2.) Short term simplicity but lack of convenience long term - Offshore Banking



SEZ Certification


This is basically a certification that signifies you operate in the IT industry mainly exporting software or digitized goods. This entitles you to tax free operation for the initial 5 years of setup and 50% tax discount for the following 5 years.

The problem here is, your office needs to be in an SEZ zone and you have to get SEZ approval which is one hell of a task but if you do manage to get it, you can declare all your earnings and not pay 1 cent of tax.



Offshore Banking

There are numerous countries like Belize, Seychelles, etc that allow foreigners to open tax free bank accounts. Some countries require a minimum deposit whereas others don't.

You can opt for one of these and transfer your US held funds there. Problem is, whenever you need to bring in money to India, if you're not an SEZ you can be taxed on it.



Bringing in Money - The Blackhat Way


Though many people may not know about this, you can bring your funds in without the Po-pos knowing a thing.

Talk to your CA, ask him to setup a system where you can wire funds to one of his SEZ clients or a similar tax free business. Then, when those funds arrive you get them in cash.

Some CA's may charge you a VERY NOMINAL fee for this but with most it should be free since the businesses get to retain foreign currency.

But keep in mind, this is as black as it gets and your earnings will always be cash so you won't be able to turn your money "white" i.e. account for it without paying tax.

could you explain abt hawala? i know something, but maybe the exact process?

Originally Posted by xenix9

Indians have been transferring money blackhat way for over a century. Your new generation folks probably have no idea about this.

Get offshore Paypal, wire money out of that Paypal to trusted indian person in offshore country. Get the money back to you by india "hawala" method.

Basically - your money gets paid to some guy in that country; he calls his guy in India; and that guys gives you money in cash.

All tax free, and easily done.

outsource to people in your own country.

Originally Posted by seolabs82

from the time since paypal changed indian regulations, every single cent spent is being taken into account for tax.

since you get all your online income directly into your bank, what sort of strategies you use to have the tax avoided to the most. share it?

You can't really avoid Tax mate. Just pay the taxes and make sure you show all your purchases this way you can adjust your profits.

Apart from that you gotta be smart while preparing your balance sheet. Consult a CA

You idiots are blaming your country,And you itself are behaving like a shit.
If your friends wife run away with a neighbour,Will you also sent your wife with another neighbour?
If few politicians are corrupt,is it that you should not pay any tax?

Tax in India is way low than that of other countries.Pay your taxes or get out of the country that gave you food,shelter and security.

Hi,

From this 1st april, 2012 the minimum threshold income free of tax is Rs 2,00,000

Now you have to declare you overseas assets in your return of income, so there goes opening a overseas bank account way of evading taxes. (and if you don't declare they can proceed against you, if they find out in the next 15 years)

Instead of evading taxes concentrate more on tax planning, as you are doing business all your expenses are allowed as deduction from your income.

The IT department is getting smarter and is getting inputs from lots of service providers including credit card companies, banking companies, jwellers etc. so tax evasion is not the right way to go now, also the penalties and interest are very high, so try it at your own peril.

Just my 2 cents

Regards,

Originally Posted by seolabs82

could you explain abt hawala? i know something, but maybe the exact process?

Also with regard to hawala transactions, earlier only financial penalties were levied on these transactions under income tax but now there is a law called Prevention of Money Laundering and hawala transactions are now a criminal offence. So do them at your own peril

MY accountant told me that unless you're earning more than 10 laks per year, you don't need to worry. After that there's service tax. Its foreign money so we don't need to pay tax under 10L. Also you can show that you're earning only 30% of amount u're getting. rest you're paying others.

Just go to an accountant and he will take care of the rest. Thats the trick.