New Delhi: New fiscal, new rules! With the new fiscal year FY
22-23 kicking in today (April 01), new and reformed Income Tax rules will also
kick in.
From April 1, several rules pertaining to personal taxation
is going to change. Here's looking at 5 major Income Tax rules changing from
the new fiscal.
30 percent tax on virtual digital assets
Income from transactions in virtual digital assets will attract
a tax of 30 percent From April 1
Finance Minister Nirmala Sitharaman in her Budget speech in
February said, "There has been a phenomenal increase in transactions in
virtual digital assets. The magnitude and frequency of these transactions have
made it imperative to provide for a specific tax regime. Accordingly, for the
taxation of virtual digital assets, I propose to provide that any income from
transfer of any virtual digital asset shall be taxed at the rate of 30 per
cent."
Updated ITR filing window
The Finance Minister also gave respite to people filing their
revised Income Tax Return (ITR) from next fiscal. FM has announced
that the revised tax filing window will remain open for two years from the year
of assessment in case of less filing of tax. The rule will be applicable from
April 1.
Tax on PF
Finance Minister Nirmala Sitharaman proposed in her budget
address for 2021-22 that PF payments of more beyond Rs 2.5 lakh per year be
taxed. The Central Board of Direct Taxes (CBDT) has issued new guidelines that
outline how the interest on an employee's provident fund contribution that
exceeds a specific level is taxed.
VDA losses cannot be set off against VDA gains
As per the amendments to the Finance Bill, 2022, circulated
among the Lok Sabha members, the government has proposed to remove the word
'other' from section relating to set off of losses from gains in virtual
digital assets. This would mean that loss from the transfer of virtual digital
assets (VDA) will not be allowed to be set off against the income arising from
the transfer of another VDA. For eg you make a gain of Rs 100 on Bitcoin while
you incur a loss of Rs 70 on Dogecoin --your tax liability will be on the
earning of Rs 100 and not on your net profit of Rs 30 (after eliminating your
loss).
State government employees NPS Deduction
State government employees will now be able to claim tax benefit
of 14 percent on the National Pension System (NPS) under
Section 80CCD(2) made by their employer up to 14% of their basic salary and
dearness allowance. The deduction will be similar to that of Central government
employees under the said section.
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