February 2019

Interim Budget 2019-2020, Tax Implications for Salaried

Interim Budget FY 2019-20 Highlights ! for Normal Salaried

Interim Budget – Highlights !

1. Full tax rebate for individuals earning up to Rs.5 lakh.

Tax savings largely for people earning about 5-10L annually.

Minimal impact for people in the higher tax slabs or earning say 15L+ etc. They still save about 3K annual for the savings on tax on 10K  increase in standard deduction

Tax Calculations with Provisions (Example of 10L+ Income and how it can go tax free.. Now)

Total Salary: 10.25 lacs *
Deductions
Housing Loan Interest 200k
Standard Deduction 50k
Sec 80C 150k
NPS 50k
Mediclaim Self 25k
Mediclaim Parents 50k*
Total Deduction 525k
Net Income 5 lac
Tax 12.5k
Rebate 12.5k
Net tax to pay ZERO

*80G and other deductions (as applicable) not taken into effect
*The above deductions are taken as example as majority of salaried people avail the same

2. TDS relief: There will be no TDS on interest earned up to Rs.40000 from savings bank account and post office savings schemes.Also, there will be no TDS on rental income of up to Rs.2.40 lakh per annum.

3. Higher standard deduction limit: Salaried individuals can claim standard deduction of up to Rs.50,000 (up from Rs.40,000) in lieu of transport and medical reimbursement.

4. Higher tax free gratuity: A good news for private sector employees. The government has proposed to double the approved ceiling limit for gratuity payouts from Rs 10 lakh to Rs 20 lakh. That means, gratuity of up to Rs.20 will not be taxable anymore.

5. No income tax on notional rent: So far, if an individual owned a second house, even if his house is vacant, he had to pay income tax on notional rent (i.e. market value of rent of the property in a particular location). However, individuals having unoccupied second house will not be required to pay tax on such a property.

6. Amending Section 54EC: Individuals can invest up to Rs.2 crore in two residential properties under Section 54 EC. At present, Section 54EC of the Income Tax Act lists the cases in which capital gains tax from long- term assets (held for more than three years) need not be charged if the gains are up to Rs. 1 crore and are invested in certain specified areas.

Points 5/6 are trying to give a boost to the sagging real estate market by introducing incentives for home purchases. I don’t think salaried people will start buying just yet considering that the prices in cities like Mumbai are still sky high. However it is good proposal for people with 2 houses or in the mode of selling etc.

Some interesting statistics

6.85 crore individuals have filed income tax returns last fiscal

The government has collected close to Rs.12 lakh crore from direct tax

 

February 2017

Interim Budget 2019-2020, Tax Implications for Salaried

Highlights of Union Budget 2017 – 2018

Highlights of Union Budget 2017 – 2018

GST – No changes in service tax & excise duty as GST draft will be launching soon

Fiscal Deficit – Seen at 3.2% (17-18) & 3% (18-19)

Current Account Deficit – 0.3% (16-17) 1st Half

FDI Investments – 1.45 Lakh Crores (16-17) 1st Half

Direct Tax – Tax to GDP Ratio is very low
Income upto 2.5 Lakhs – Nil Tax
Income above 2.51 Lakhs to 5 Lakhs – Reduces to 5% Tax from 10%
Income above 50 Lakhs to 1 Crore – 10% surcharge

Farmer – Double their income in 5 years

Agriculture – 10 Lac Crores credit

MNREGA – Allocation 48,000 Crores

PM Gram Sadak Yojna – Allocation 19,000 Crores

Sr. Citizen – 8% guaranteed pension for 10yrs by LIC of India scheme

(more…)

February 2016

Union Budget 2016 Highlights !!!!

Union Budget 2016 Highlights, Indian Economy, Budget 2016,

Union Budget 2016 Highlights !!!!

1. Rs. 35984 crores allotted for agriculture sector.2. Rs. 17000 crores for irrigation projects.
3. Two new Organic farming scheme for 5 lakh acres.
4. Rs. 19000 crores for Gram Sadak Yojana
5. Rs. 9 Lakh Crores Agriculture Credit Target.
6. Rs. 38500 crores for MANREGA, highest ever.
7. Rs. 2.87 Lakh crores to be spent on Villages in total.
8. Rs. 9000 crores for Swach Bharat Mission.
9. Rs. 97000 Crores for Roads.
10. Total Outlay on Roads and railway Rs. 2.18 Lk Crores.
11. Rs. 2.21 Lakh Crores on Infra Projects.
12. NHAI to raise Rs. 15000 crores via NHAI Bonds.
13. More benches for SEBI Appellate tribunal.
14. Registration of Company in One Day for Start-ups.
15. Rs. 25000 crores for Banks rehabilitation.
16. 100% FDI for food processing.
17. Non planned expenditure of Rs. 14.28 Lk Crores.
18. Planned expenditure increased by 15.3% .
19. Relief Section 87A Rs. 2000 to Rs. 5000
20. Relief Sec 80GG Rs. 24000 to Rs. 60000
21. Section 44AD limits Rs. 1 crores to Rs. 2 crores. Rs. 50 Lakh for professional
22. Accelerated depreciation limited to 40%
23. New manufacturing companies will pay tax @ 25%.
24. LTCG on unlisted securities limited to 2 years.
25. 100% tax deduction for companies building houses upto 30 sq. mtrs.
26. Additional interest deduction for first house.
27. No service tax for building houses upto 60 sq mtrs.
28. 10% dividend tax for recipient over Rs. 10 lakh per annum.
29. TCS on purchase of asset over Rs. 2 Lakh in case and luxury cars.
30. VDS Scheme @ 30% + surcharge, Ist June to 30th September 2016.
31. Dispute resolution for appeal pending before Commissioner(Appeals).
32. Penalty for concealment of Income from 100-300% to 50-200%.
33. Rationalisation of TDS provisions.
34. 11 new benches for Income Tax Appellate tribunal.
35. No face to face scrutiny…..