No changes were made to the tax slabs and deductions in the 2022 budget session held yesterday. However, there is some relief for a taxpayer who mistakes filing the income tax return. Several other measures were announced yesterday which could impact taxpayers and investors.
- If you missed including your rental income or interest earned via your savings bank account while filing your tax returns, you would now be permitted to file an updated tax return. You can pay the relevant taxes in less than two years from the end of the assessment year.
- The Union Budget 2022 recommended amendments to the Income Tax Act. A business entity or an individual will no longer be allowed to set off losses against undisclosed income determined after search and survey operations.
- In case you miss filing your income tax return in the previous year, you will need to pay a higher tax rate deducted at source (TDS) apart from the penalty. The TDS rate will be higher than 5% or double the current rate in such cases.
- The government has received a provision to impose a ‘differential’ excise duty of Rs 2 per litre starting 1 October towards unblended fuel.
- The tax burden towards the sale of shares will reduce for founders, investors, and holders of employee stock options at startups. The Finance Minister (FM) also mentioned that the long-term capital gains tax surcharge would be capped at 15% concerning all listed and unlisted instruments.
- From now on, state government employees will receive a tax break on their employers’ contributions towards the National Pension Scheme (NPS) up to 14% – which is currently 10% of their salary and dearness allowance.
- As per the current law, a deduction is provided to a parent or guardian only when the lumpsum payment or annuity is accessible to a differently-abled person on the death of a subscriber, i.e., either to the parent or the guardian. Nevertheless, there could be a scenario wherein a differently-abled dependant might require a lump sum amount or the annuity payment even during the lifetime of their parents or guardians. FM has now proposed to permit the payment of a lump sum amount and annuity to a differently-abled dependant even during the lifetime of the parents or guardians, once they reach 60 years of age.
For any clarifications/feedback on the topic, please contact the writer at bhavana.pn@cleartax.in.
Bhavana is a Senior Content Writer handling the GST vertical. She is committed, professional, and has a flair for writing. When away from work, she enjoys watching movies and playing with her son. One thing she can’t resist is SHOPPING! Her favourite quote is: “Luck is what happens when preparation meets opportunity”.
