CA Nirmal Ghorawat's Blog

1. STANDARD DEDUCTION FOR SALARIED EMPLOYEES ₹50,000/- introduced in New Tax Regime similar to the existing provision for Old Tax Regime.
2. Tax Rebate u/s 87A upto Taxable Income of ₹7,00,000/- under New Tax Regime. Under Old Tax Regime Rebate u/s 87A will continue be available for Taxable Income upto ₹5,00,000/- only.
3. Tax Slabs under New Tax Regime Revised leading to Tax Savings for those opting for NTR.
   Upto ₹3 Lakhs – Nil
   ₹3 Lakhs to ₹6 lakhs – 5%
   ₹6 Lakhs to ₹9 lakhs – 10%
   ₹9 lakhs to ₹12 lakhs – 15%
   ₹12 lakhs to ₹15 lakhs – 20%
   Above ₹15 lakhs – 30%
4. Surcharge reduced to 25% from 37% on Income above ₹5 crore in case of New Tax Regime. Except this, no changes in rates or threshold of Surcharge & Cess.
5. No changes in Tax Slabs or Rates have been proposed under the Old Tax Regime. Further, there is no New Deduction or Exemption nor any concession in rates if Surcharge or Cess in Old Tax Regime.

Author’s Comments : Tax Outgo must not be the Sole Criteria to opt / plan for between Tax Saving Investments and New Tax Regime or Old Tax Regime. (Discretionary) Cash Flows must be considered as well.

NEW TAX REGIME GETS ATTRACTIVE VIS A VIS OLD TAX REGIME.

6. New Tax Regime will become the default Option for Individuals & HUFs. Option will have to be exercised before the due date of Filing ITR if Assessee desire to opt for the Old Tax Regime.

7. Revision in Exemption Limit of Leave Encashment for Non-government Salaried Employees from ₹3 lakhs to ₹ 25 lakhs.
8. Anti Tax Avoidance – Interest on Housing Loan claimed as Deduction u/s 24 not Chapter VI-A shall not be included in computing Cost of Acquisition while determing Capital Gain on Transfer.
9. Capital Gain Deduction u/s 54 & 54F – Investment in Residential Property or Rollover of Invesment in Residential Property capped to ₹10 crore.
10. Conversion of physical Gold to electronic Gold Receipt (Digital Gold) shall not be considered a transfer / prior period of holding physical Gold to be considered for determing Capital Gain on transfer Digital Gold so converted.
11. Market Linked Debentures will be taxed as Short Term Capital Asset (ie at Slab rates) without benefit of Indexation and also STT paid will not be allowed as deduction.
12. Taxation provision for Life Insurance Policy – Survival Benefit Less Premium paid (aggregate annual Premium above ₹5 lakh) introduced. Death Benefit continues to be Exempt from Income Tax.
13. Gift or Sum received without consideration from Non-relative exceeding ₹50,000/- (aggregate if all gifts) received by Non-Residents brought under Tax Net (56(2)(x)).
14. Issue of Shares at Premium by Closely Held Company in excess of FMV to Non-Resident brought within the scope of Section 56(2).
15. Increase in threshold limits for Presumptive Taxation u/s 44AD (from ₹ 2 crore to ₹ 3 crore) & 44ADA (from ₹ 50 lakhs to ₹ 75 lakhs) subject to Cash Receipts being less than 5% of Gross Receipts or Total turnover. Previous limits u/s 44AD & 44ADA continue to be available irrespective of Cash Receipts exceeding 5% of Gross Receipts or Total turnover.
16. Delayed Payments (after 45 days) to MSMEs shall be disallowed / not allowed as deduction u/s 43B.
17. 80IBA Deduction for Startups – penultimate Date of Incorporation for eligibility extended for 1 year upto 31.03.2024.
18. TCS on Overseas Tour Package & Drawal of Foreign Exchange (Foreign Remittances) under Liberalised LRS except for Educational purpose @20% without any threshold (earlier 5% & above ₹7 lakhs threshold)
19. TDS on Net Winnings from Online Games introduced @30% plus applicable Surcharge & Cess.
20. TDS on cash withdrawl by Cooperative Society ~ threshold increased to ₹3 crore
21. Benefit of Concessional Income Tax Rate in case of manufacturing companies extended to manufacturing cooperative society @15%.
22. New Deposit Scheme for Females – two years tenor; 7.5% interest rate and maximum ₹2 lakhs principal deposit.

Post Office Schemes Maximum Deposit Amount increased ::

23. Senior Citizen Savings Scheme from ₹15 lakhs to ₹30 lakhs.
24. Monthly Income Scheme or MIS from ₹4.5 lakh to & ₹9 lakh in case of Single Account Holder and ₹9 lakh to ₹15 lakh in case of Joint Account Holder.