Income Tax Rules Change: From April 1, 2021, many rules related to income tax will be changed. Finance Minister Nirmala Sitharaman (Union Finance Minister Nirmala Sitharaman) announced these changes in Budget 2021. The new changes include exempting 75-year-olds from filing income tax, in addition to raising TDS and making big announcements on tax on EPF.
So let’s understand all the tax changes one by one, which will affect you and our life from 1 April 2021.
Income Tax rules on PF
From April 1, interest on the contribution of more than 2.5 lakh rupees in the provident fund will be taxed. The government says that people will come under its ambit who use EPF to earn interest by contributing more. The Finance Minister announced this change and said that EPF is for the benefit of the employees. This change will not affect those who earn Rs 2 lakh or less in a month.
More TDS will be deducted for those who do not fill ITR
As more and more people file income tax returns (ITR), Finance Minister Nirmala Sitharaman proposed to impose more TDS (Tax Deducted at Source) or TCS (Tax Collected at Source) in Budget 2021. For this, two sections 206AB and 206CCA were proposed to be included in the Income Tax Act in the budget.
Relief for the elderly over 75 years
In the budget, big relief was given to the elderly people over 75 years. In order to reduce the burden of compliance on such elders, the Finance Minister had announced to give exemption from filing ITR. Exemption from filling ITR will be available only to those elders, whose earning is only interest from pension and bank deposits. These two should be in the same bank. If the income of the elderly is anything else, then they will have to file ITR. Such as house, shop rent, etc.
ITR forms will be pre-filled
From April 1, now a lot of information will be pre-filled in the ITR form. Information like salary of taxpayers, tax payment, TDS are already available in ITR form, which reduces the burden of compliance. Now the information about capital gains tax, dividend income and interest from banks, post office will also be filled in advance from the listed securities of taxpayers. With this step, it will now be easier to file tax returns.
Big relief on LTC
Due to covid-19 and lockdown, central employees could not take advantage of the Leave Travel Concession (LTC), for them it was proposed in the budget that tax exemption on cash allowance for LTC be given.
