Know The Changes In Income-Tax Rules Effective Today
New Delhi: Income-Tax (I-T) rules will see many changes effective April 1 for the next financial year. Following are some of the major changes, according to a report in the Mint.
The crypto tax in India kicks in from today. The 30% tax rule will be effective from the start of the fiscal year while the 1% TDS rule will come into effect from July 1, 2022. The threshold limit for TDS would be ₹50,000 a year for specified persons, which includes individuals/HUFs who are required to get their accounts audited under the I-T Act.
Cryptocurrency or other virtual digital asset gift will be taxable.
The Indian government has disallowed losses in a particular digital asset to be set off against income from another crypto holding. For instance, if you make ₹1,000 gain on bitcoin and ₹700 loss on Ethereum, you have to pay tax on ₹1,000 and not on your net profit of ₹300. Similarly, you cannot set off gains and losses on cryptocurrency against gains and losses in other assets like stocks, mutual funds or real estate.
Filing updated I-T return
Taxpayers can now file an updated return within two years from the end of the assessment year to correct mistakes in Income-Tax returns.
State government employees will now be able to claim deduction under Section 80CCD(2) for NPS contribution by the employer up to 14% of their basic salary and dearness allowance.
Tax on PF
A cap of tax-free contributions up to ₹2.5 lakh is being imposed on the Employee Provident Fund (EPF) account. Any contribution above this, the interest will be taxed.
Surcharge on LTCG
Presently, there is a cap of 15% surcharge on long term capital gain on sale of listed equity or mutual funds. From April 1, this cap will be extended to long term capital gain on all assets.
There was an additional deduction on home loan interest up to ₹1.5 lakh on houses valued less than ₹45 lakh for first time homebuyers. FM has not extended this scheme. This additional deduction of ₹1.5 lakh won’t be available to taxpayers from April 1. Other existing deductions on account of home loan interest up to ₹2 lakh would be continued u/s 24 of I-T Act.
Tax relief on Covid-19 treatment
Tax exemption will be given to patients who have received money for COVID treatment. Similarly, money received by family members as compensation for COVID deaths will be exempt up to Rs 10 lakh if payment is received within 12 months from the date of death. This amendment will be effective retrospectively from April 1, 2020.
Tax relief to persons with disability
Parent or guardian of a differently-abled person can take an insurance scheme for such a person.
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