The Income Tax Department launched its new e-filing portal www.incometax.gov.in
New e-filing Portal Features And Benefits are covered in our video.
b) Easy to use
c) Multiple login Options
d) Single Dashboard
2. Income tax payment on same portal
a) Multiple Payment Options
b) No challan needed
Popular Article: Wealth Habits – Learn, Unlearn and Relearn
3. Easy to fill details
a) Interactive Q&A format
b) Pre -filled data
4. Quick Processing of Income Tax
5. Quick Refund
6. Help Support
7. Mobile App available
Date of filing ITR – Extended from 31st July to 30th Sep
To get started with personalized Automated financial planning visit – http://bit.ly/Financial-Planning-Tool
The budget brings a bag of amendments along and there begins a never-ending discussion of whether these are good news or not. So like every other year, this year, the Budget introduced some of the peculiar changes in existing Income Tax Laws which will certainly impact your pocket from the start of the coming financial year.
So we decided to sum up everything that could knock your pockets from April 1st, 2021. Hope this article will help everyone looking for amendments affecting or impacting their pockets from April 1st.
Introduction of new wage code
This Budget came with the New-Wage Code which dictates that the basic component in the Salary structure should be at least 50%. Currently, companies have a practice of capping the basic pay around 25-40%, however, with the introduction of the New-Wage Code, Basic Component will be a minimum of 50%.
Implementation of the same may yield interesting results. Capping the basic pay at 50% would mean that other allowances like HRA etc. are capped at 50% altogether. Pay packages will definitely witness a rejig in the salary structure since there are also other rules like PF rules and gratuity which will change with this Budget.
Related Article: Checklist for your Investment portfolio in 2021
1. Provident Fund Rules and Regulations
The Budget has announced certain changes in EPF rules too. Currently, the Employees Provident Fund comes with the tax status of EEE. Contribution to Employee’s Provident Fund as well as the proceeds from the EPF are tax-free.
However, with this budget, contribution above Rs. 2.5 lakhs towards EPF would be covered under Income Tax.
If the employer provides the option of opting for NPS (National Pension Scheme) as an alternative for tax saving over and above the contribution of Rs.2.5 lakhs, then only the employee would be able to save tax.
This rule is also applicable to the Voluntary Provident Fund (VPF). Hence, if the contribution at any time, considering both EPF and VPF exceeds rs. 2.5 lakhs then the excess would be charged to Income tax from now onwards.
2. Pinch to Income Tax Returns Non-filers
Respected Finance Minister Ms. Nirmala Sitharaman made it plenty clear that the Income Tax is widening its scope and coverage. One more hint is the insertion of section 206AB, which basically deals with the highest rate of TDS for non-filers of Income Tax Returns. Additionally, the highest rate of TCS is dictated by section 206CCA.
This move is expected to bring the non-filers also into the Income Tax net. Mass filing of ITR would definitely result in improvement in the transparent process of ITR.
3. Prefilled Income Tax Returns are a reality now
ITR filing for capital gain is very complex and time-consuming especially for shares and mutual fund trading. However, this year brings a welcome change to this set process. Finance Minister has announced the entry of prefilled Income Tax Return w.r.t following
- Income under the head “Capital Gain” from the sale of listed securities.
- Income from dividend
- Interest Income from Bank fixed deposits
- Interest Income from Post Office
This will achieve ease of filing as well as will ensure that no income escapes the taxability.
4. Leave Travel Concession in COVID-19 backdrop
The year 2020 has been harsh to everyone and hence the Respected Finance Minister has announced a change in LTC (Leave Travel Concession) in this year’s Budget.
This year would be in the form of a cash allowance rather than a regular LTC scheme due to the COVID-19 impact.
This scheme will be exercised in the block of 4 years of 2018-2021. LTC was available only on travel expenditure earlier. But in 2021, the employees are allowed to take an exemption of the amount spent on buying the specified goods and services as notified. It is required that the money should have been spent on goods and services through electronic mode and from 12th October 2020 to 31st March 2021. However, this scheme specifies the upper cap on the expenditure as well.
5. Gratuity is Good News after all
Gratuity was previously applicable only if you were onboarded on the payroll of the company. It required that the employees should complete a minimum period of employment before becoming eligible for gratuity payment.
However, with new Gratuity rules, even if the employee works on contract even for a year, then he would be eligible for the gratuity. This change is considered a welcome move.
6. Changes in ULIP contribution
This Budget has brought in the new and much-awaited news from the perspective of the private players in the mutual fund markets. ULIPs were totally exempt and considered under EEE tax status.
However, with these budget amendments, the tax would be levied on capital gains at par with mutual funds, which is at 10% on the amount exceeding Rs.1 lakhs. However, ULIPs are taxable only if the annual premium amount increases by 2.5 lakhs. Due to this amendment, ULIPs no longer would be lucrative as compared to Mutual Funds in tax scenarios.
Important pointers to deal with the changes
- Check if the salary pay package is changing as per the wage code and make necessary changes for maintaining the liquidity position all along.
- Reconsider the Employees Provident Fund and Voluntary Provident Fund contributions so as to mitigate the tax liability brought in by the budget.
- Check with the employer whether LTC claims are entertained and what are the eligible goods and services for which they can be availed.
- If you are a contract employee, ensure that you will at least complete a year to be eligible for gratuity.
- Consider reorganizing the tax investments for availing deductions in line with amendments, especially w.r.t ULIPs, EPF contribution, etc.
- Always ensure to file ITR on or before the due date to avoid the highest rate of Interest.
The Income Tax Department of India has announced the last dates to file Income Tax Return (ITR) for financial year 2019-2020. After several extensions, the date for individuals, Hindu Undivided Family, Body of Individuals and Association of Persons has been finalised on 30th November. Businesses requiring Audit & Transfer Pricing report need to carry out their tax return filing by 31st October.
If you are filing your tax return online for the first time, then your chance of getting confused is pretty high. Today, we are going to walk you through some income tax return filing tips, which can be of great assistance while you file your returns without making any mistakes. So, keep them in mind while filing your income tax return form in a confident manner.
- Choosing The Right Form
There are seven different kinds of forms available for you to choose from. You have to understand which one is applicable to you and choose the right one accordingly. Some of these are meant for specific companies and trusts, while others might apply to specific individuals or Hindu Undivided Families (HUF). Most importantly, the Central Board of Direct Taxes (CBDT) has issued new forms for the assessment year 2020. Some of the earlier forms have been replaced as well making it even more crucial to choose the correct one.
- Missing Deadlines
If you miss the specified deadline, then you will have to pay a late fee based on your income. However, you shall always have the option of filing a belated return. Even though it is not the most desirable thing to do, a belated e tax filing for the financial year 2019 can be carried out within 31st March 2021.
- TDS And Rent Paid
If you are a tenant paying rent that is over 50,000 INR a month, you will have to deduct 5% in the form of TDS. Even though you will not be able to show it as your own tax liability while e tax filing, this has been made mandatory by the central authorities. You also need to keep in mind that your landlord will receive the credit for TDS paid
- Income Tax Return
You may be working as a salaried employee in a company that deducts a certain amount in the form of TDS every month. Even if Form 16 is issued, it does not relieve you of your responsibilities to pay your taxes. You have to find out if you are applicable for income tax e-filing and accordingly choose the relevant form to file your returns with the Income Tax Department of India.
- Interest Income And ITR
If you have a bank account (savings), then interest earned more than 10,000 INR on the same shall be taxed. Even if it is less than that amount, you will have to provide this information while filing your ITR. However, senior citizens can claim exception in interest income up to 50,000 INR on their bank deposits.
Related Article : Know How To Save Taxes By Claiming Expenses
- Unpaid ITR Dues
If you have failed to pay your taxes for the last few years, then you can file a belated return only for FY 2018-19. Tax returns for Financial Years 2016-17 and 2017-18 cannot be filed any further.
- Income Tax Return Tips for Consultancy Professionals
If you happen to be a doctor, architect, engineer, etc., and your source of income is through professional consultation, then you can opt for a presumptive taxation scheme. Tax consultants in Mumbai, India advocate the selection of either ITR-3 or ITR-4 form, in such a case. However, if your income is less than 50 lakhs INR (through indirect consultation) then you need to proceed with ITR-1 form. If Consultation is not your only source of income and it exceeds 50 lakhs INR, you may have to choose ITR-2 form.
- Basic Information Requirements
While filing your Income Tax Returns, you will need to provide information regarding a few basic things such as PAN Card details, your Address, Bank Account number, mobile number and email ID. The process of online tax filing will be faster if you have these documents ready and with you, before beginning with the procedure.
- Income Tax Rates
The income tax rates differ based on your income bracket. If your income is up to 2,50,000 INR then tax rate will be 0%. If it falls between 2.5 lakh and 5 lakh INR, the tax rate will be 10% of the amount exceeding 2.5 lakh INR. The tax rate will keep on increasing after this. For example, if your revenue falls under the taxable bracket between 5-10 lakh INR, the tax rate will be 20% of the amount exceeding 5 lakh. Similarly, for income above 10 lakh, the tax rate becomes 30% of the amount exceeding 10 lakh. This however does not apply to you if you are a senior citizen.
- Income Tax Rates For Senior Citizen
If you are a senior citizen falling under the prescribed age bracket (60-79 years) you will receive a basic tax exemption up to 3 lakh INR. For individuals, above 80 years of age, the basic tax exemption amount is 5 lakh INR.
Income tax e-filing can prove to be a strenuous procedure because off frequent alterations in the forms. With more columns and tables being added for ensuring better presentation of information regarding the sources of income it becomes all the more necessary to understand these Income Tax Return filing tips in details. Alternatively, you can also seek out the assistance of tax advisory firms if you are not feeling very confident about getting it done by yourself.