CA Pooja Madhan

In this article we will discuss the recent amendments which have been made applicable with effect from 1st April 2018:

 

  1. Basic Tax Exemption limit is Rs. 2,50,000/- for non Senior citizens. After that, up to 5 Lakh, Tax rate is 5%. Tax Rate of 5% is applicable from Financial Year 2017-18 and also applicable for Financial Year 2018-19.

 

  1. Payment of Rent – If the rent is paid which is not less than Rs.50,000 per month by any Individual or HUF (not subject to Tax Audit requirement) – TDS @ 5% is required to be deducted

 

  1. Tax rebate under section 87A has been reduced to Rs. 2500 from Rs. 5000 per year for taxpayers with income up to Rs. 3,50,000 (earlier it was Rs. 5,00,000) with effect from financial year 2017-18.

 

  1. Limit for payment of expenses by cash (Both capital and revenue expenditure) has been reduced from Rs.. 20,000 to RS. 10,000 per day in aggregate per person.

 

  1. Section 269ST has been introduced according to which no Person shall receive an amount of two lakh rupees or more, by cash.

 

 

  1. Late fee of ,Rs.5,000 will be if the Income Tax return not filed within stipulated time for delay up to 31st December, and for delay beyond 31st December Rs.10,000 will be payable.

 

  1. Donation made exceeding Rs. 2,000 in cash will not be eligible for deduction under Section 80G. Hence donation exceeding Rs. 2,000 must be made in mode other than cash.

 

  1. Unquoted shares to be taxed at (deemed) fair value.

 

  1. Tax exemption will be available on  reinvestment of capital gains in notified redeemable bonds.

 

  1. In absence of PAN of the buyer of specified goods, the rate of  TCS will be twice of the existing  rate or 5% , whichever is higher.

 

  1. No Tax is applicable for partial withdrawals from National Pension System. NPS subscribers will be able to 25% of their contribution to corpus for emergencies before retirement. Withdrawal of 40% of the corpus is Tax free before retirement.

 

  1. Time period for revision of  Tax return has been reduced to 1 year from 2 years  from the end of relevant financial year or before completion of assessment,  whichever is earlier.

 

  1. In case of modification of object clause of Trust Registered u/s 12AA, approval from CIT must be obtained within 30 days.

 

  1. It has been made mandatory to disclose the Aadhar number while filing IT Return it was optional to quote Aadhar on Income Tax Return earlier.

 

  1. A simple one page tax return form is to be introduced for individual with taxable income up to Rs. 5 lakh (excluding Business Income ). Those filing returns for the first time in this category will generally not be subject to scrutiny.

 

  1. Capital gain in respect of  Land and Building period reduced from 3 years to 2 years and Base year shifted from 01/04/1981 to 01/014/2001.

 

  1. For below Rs. 2 crores turnover cases – For Non cash sales (through Digital, Online, Cheque, Bank etc.) : Net profit will be taken as 6% of Turnover/Gross Receipt. It is 8% for Cash Sales.

 

  1. Income Tax rate for companies having annual turnover of upto Rs. 50 Crores will be taxed at reduced rat of 25%. No change in firm tax rate of 30%.