Finance Minister Nirmala Sitharaman had introduced a few modifications within the revenue tax guidelines throughout Union Funds 2021. These guidelines have come into impact from 1 April 2021, and a few of these modifications embrace exemption for submitting ITR returns for senior residents of the age 75 and above with revenue from pension and curiosity from fastened deposit in the identical financial institution.
Amongst different key modifications are the proposed larger tax deducted at supply (TDS) for many who are usually not submitting their ITR and funding in EPF account to return beneath the ambit of revenue tax. Additionally Learn: Forgot To Carry Debit Card? Here is How To Withdraw Money From ATM Utilizing Smartphone
PF tax guidelines: The federal government’s determination to tax the high-value depositors within the Worker Provident Fund (EPF) has stunned many buyers. One of many many modifications is that the curiosity on annual worker contributions to provident fund over Rs 2.5 lakh could be taxed from 1 April 2021. Whereas asserting the change, the FM mentioned it’s aimed on the welfare of staff, and any individual incomes lower than ₹2 lakh per 30 days won’t be affected by the proposal. Alternatively, the finance ministry raised the deposit threshold restrict to Rs 5 lakh each year in provident fund for which curiosity would proceed to be tax-exempt, if there is no such thing as a employer contribution.
Possibility to decide on new tax regime: The brand new tax regime introduced in Funds 2020 will kick in for the monetary yr 2020-21(FY21). Taxpayers could have an possibility to decide on new tax regime as an alternative of outdated tax regime on the time of submitting their tax returns.
Senior residents above 75 years exempted from submitting ITR: In tune with different measures taken to ease compliance burden on widespread man throughout Covid occasions, the federal government has introduced reduction measures for senior residents above 75 years. The Funds 2021 has exempted submitting ITR returns for these above 75 years from submitting revenue tax returns (ITR). Keep in mind, senior residents who haven’t any different revenue however depend upon pension and curiosity revenue from the financial institution internet hosting the pension account.
TDS: In an try to make sure that extra individuals file revenue tax returns (ITR), the finance minister has proposed larger TDS (tax deducted at supply) or TCS (tax collected at supply) charges. The Union Funds 2021 has proposed the incorporation of latest Sections 206AB and 206CCA within the Revenue Tax Act as a particular provision for the deduction of upper charges of TDS and TCS, respectively for the non-filers of an revenue tax return.
LTC: The federal government has proposed a tax exemption to money allowance towards Go away Journey Concession (LTC). This explicit scheme was introduced by the federal government in 2020 to augur spending within the economic system by permitting people who have been unable to assert their LTC tax profit on account of covid-related restrictions on travelling.
Pre-filled ITR types: Making the method of tax fee simpler, the federal government has proposed pre-filled Revenue Tax Returns (ITR) together with particulars of wage revenue, tax funds, TDS, and so on. together with in revenue tax returns. In truth, particulars of capital good points from listed securities, dividend revenue, and curiosity from banks, put up workplace, and so on. can even be pre-filled.