There is no change in the tax slab in the budget presented by Finance Minister Nirmala Sitharaman. However, several such steps have been announced in the budget, which will give taxpayers relief from filing income tax returns and advance tax payments. We are introducing you to the impact of the announcements made in the budget on taxpayers.
1. Above 75 years of age, then freedom to file returns
The Finance Minister said in the budget speech that people above the age of 75 years will not have to file income tax returns. This does not mean that people over the age of 75 will no longer have to file returns. Only those people above the age of 75 years will come under the purview of this rule of the government, whose income basis is the interest received through other means including pension or FD. Such people will not just have to pay returns. As before, their TDS will be deducted in the bank itself. If the medium of income is something else, such as business etc. then returns have to be filled.
2. Relief in revaluation of tax
Till now, cases of revaluation of tax could be opened after six years and in severe cases even after 10 years. Now the revaluation of the tax has been reduced to three years. If in serious cases, there will be a matter of hiding income of more than 50 lakhs in a year, only then cases can be opened for 10 years. However, he would have to get approval from the commissioner.
3. Relief by collecting separate data
The government has given some relief to the employed people. In fact, till now, the employed people had to give separately the details of interest received from investment in other means including FD, apart from Form 16A. Now this will not happen. Their information will already be in Form 16A, so that the income tax payer will not have to collect data separately.
4. Exemption from accounting of dividend income
Taxpayers will no longer have to calculate the income from dividends at the time of payment of advance tax. TDS will be deducted only when the dividend is declared or the company pays. This will relieve the taxpayer from paying tax on interest. Actually, if the dividend is not announced while giving TDS, then tax is deducted on the basis of estimates only.
5. Relief of double imprisonment to NRIs
In the Union Budget, relief has been given to Indians living abroad. He had to contend with double imprisonment, but that would not happen now. The government has announced to give them relief. The Finance Minister said that NRIs used to face difficulty in paying taxes. In such a situation, they are being given relief from double imprisonment.
6. Discount on investment in startup
Investors investing in startups are exempted from capital gains for a year. This will benefit startup units and individuals engaged in innovation.
7. Announcement of formation of faceless committee
To give relief to the taxpayers, the Finance Minister announced the formation of a faceless committee. Under this, a Dispute Resolution Committee will be set up. This will ensure transparency between the tax authorities and the taxpayer. People with taxable income up to Rs 50 lakh and disputed income up to Rs 10 lakh can go to this committee. The hearing for this will be through video conferencing.
8. Capital gains tax on ULIPs
It has been announced in the budget that if a premium of more than Rs 2.5 lakh is deposited annually in the unit linked insurance plans from February 1, 2021, then the income from it will be treated as capital gains and will be taxed as per the rule. In the event of death of the ULIP taker, no tax will be charged.
9. Return to be filled within the limit of three months
Now, within three months of the end of the tax year, delayed or revised income tax returns have to be filed. That is, now every year till 31 December ITR has to be filled. After that you will have to pay a higher fine. Similarly, the assessment period of ITR has also been reduced to 3 months. This will relieve the taxpayers of late, but Indian taxpayers earning from abroad may have difficulty in claiming tax exemption or getting exemption from tax filing in another country.
10. If there is more deposit in PF, then interest
Both employer and employee put money in PF. The rule says that the amount of money that the employer puts for you, will still remain tax-free.