Abhishek Raja "Ram"
about 1 month ago
๐๐ฒ๐ ๐๐ป๐ฐ๐ผ๐บ๐ฒ ๐ง๐ฎ๐ ๐๐ฎ๐ ๐๐ต๐ฎ๐ป๐ด๐ฒ๐ ๐๐ณ๐ณ๐ฒ๐ฐ๐๐ถ๐๐ฒ ๐๐ฝ๐ฟ๐ถ๐น ๐ญ, ๐ฎ๐ฌ๐ฎ๐ฑ [img:E55dwq-s7]
๐ฅ๐ฒ๐๐ถ๐๐ฒ๐ฑ ๐ง๐ต๐ฟ๐ฒ๐๐ต๐ผ๐น๐ฑ๐ (๐๐ณ๐ณ๐ฒ๐ฐ๐๐ถ๐๐ฒ ๐๐ฝ๐ฟ๐ถ๐น ๐ญ, ๐ฎ๐ฌ๐ฎ๐ฑ) The Central Board of Direct Taxes (CBDT) has increased TDS threshold limits across multiple sections: [img:BL5ZmciCV]
๐จ๐ฝ๐ฑ๐ฎ๐๐ฒ๐ฑ ๐ฅ๐ฒ๐๐๐ฟ๐ป ๐๐ถ๐น๐ถ๐ป๐ด ๐ง๐ถ๐บ๐ฒ๐น๐ถ๐ป๐ฒ ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐ญ๐ฏ๐ต(๐ด๐) The deadline for filing an Updated Tax Return has been increased from 12 months to 48 months (4 years) from the end of the relevant assessment year. This provides greater flexibility for taxpayers to correct returns, reducing disputes, but the graduated penalties ensure compliance discipline, balancing taxpayer convenience with revenue protection. [img:VIgMa27cL]
๐๐ ๐๐ฒ๐ป๐๐ถ๐ผ๐ป ๐ผ๐ณ ๐๐ ๐ฒ๐บ๐ฝ๐๐ถ๐ผ๐ป ๐๐ผ ๐ฆ๐๐ฎ๐ฟ๐-๐๐ฝ๐: The incorporation deadline for eligible start-ups to avail tax holiday benefits is extended from March 31, 2025, to March 31, 2030. Amendments may require updates to Rule 11AA for start-up eligibility, with notifications clarifying the extended deadline. Circulars, such as Circular No. 13/2025, may guide compliance. ๐๐ผ๐ป๐ฐ๐น๐๐๐ถ๐ผ๐ป: The continued tax exemption under Section 80-IAC until April 1, 2030, provides a significant boost to the start-up ecosystem, encouraging innovation and growth by offering a longer period of tax relief. [img:gzcRUzPyb]
๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐ญ๐ญ๐ฑ๐๐๐ ๐๐บ๐ฒ๐ป๐ฑ๐บ๐ฒ๐ป๐๐ The Finance Act 2025 has significantly altered tax slab rates under the new tax regime (Section 115BAC). This regime continues to be the default tax option, with taxpayers needing to actively opt for the old regime if preferred. ๐๐ฎ๐๐ถ๐ฐ ๐๐ ๐ฒ๐บ๐ฝ๐๐ถ๐ผ๐ป ๐๐ถ๐บ๐ถ๐ The basic exemption limit under the new tax regime has been increased from Rs 3 lakh to Rs 4 lakh. ๐๐บ๐ฝ๐ฎ๐ฐ๐ -> Potential tax savings of up to Rs 1.14 lakh per annum -> Lower and middle-income taxpayers stand to benefit significantly -> Reduced number of taxpayers required to file returns at the lower income levels [img:MyP27XLMY]
๐๐บ๐ฒ๐ป๐ฑ๐บ๐ฒ๐ป๐ ๐๐ผ ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐ฎ๐ฌ๐ฒ๐ ๐๐ต๐ฎ๐ป๐ด๐ฒ: TCS on goods sales (Section 206C(1H)) withdrawn from April 1, 2025. Sections 206AB and 206CCA are omitted. The definition of forest produce is introduced, with TCS rate for timber and other forest produce reduced from 2.5% to 2%. The Liberalised Remittance Scheme (LRS) threshold under Section 206C(1G) increases from Rs. 7 lakhs to Rs. 10 lakhs, with no TCS on education loan remittances under Section 80E(3)(b). ๐๐บ๐ฝ๐ฎ๐ฐ๐: These changes reduce the compliance burden for businesses and individuals, particularly small taxpayers, by increasing thresholds and removing complex provisions. This simplifies tax collection and reduces paperwork, enhancing efficiency. The increased LRS threshold benefits frequent international travelers, easing financial transactions. [img:I47TR5xyn]
๐๐ต๐ฎ๐ป๐ด๐ฒ๐ ๐ถ๐ป ๐๐ฎ๐ฝ๐ถ๐๐ฎ๐น ๐๐ฎ๐ถ๐ป๐: ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐๐ณ๐ณ๐ฒ๐ฐ๐๐ฒ๐ฑ: Section 10(10D) Change: Unit Linked Insurance Plans (ULIPs) not exempt under this section are classified as capital assets. ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐๐บ๐ฒ๐ป๐ฑ๐ฒ๐ฑ: Section 45(1B) Change: ULIPs are taxed as capital gains under this new sub-section. The taxation of high-premium ULIPs as capital gains is aimed at removing perceived tax arbitrage and aligning the tax treatment of these investment-linked insurance products with other purely investment-oriented financial instruments . ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐๐บ๐ฒ๐ป๐ฑ๐ฒ๐ฑ: Section 112A Change: ULIPs are considered equity-oriented funds under this section if they meet the 90%/65% investment requirement in equity shares. ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐๐บ๐ฒ๐ป๐ฑ๐ฒ๐ฑ: Section 115AD Change: Long-term capital gains tax for non-residents on certain securities (excluding Section 115AB units) increased from 10% to 12.5%. ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐๐บ๐ฒ๐ป๐ฑ๐ฒ๐ฑ: Section 2(14) Change: Clarification that any security held by investment funds referred to in Section 115UB and invested per SEBI regulations is treated as a capital asset. ๐๐บ๐ฝ๐ฎ๐ฐ๐: These changes ensure uniform taxation across financial instruments, with ULIPs now taxed similarly to other investments, potentially affecting insurance product sales. The increased rate for non-residents may impact foreign investment decisions, aligning with resident rates for fairness. ๐ฅ๐๐น๐ฒ๐, ๐ก๐ผ๐๐ถ๐ณ๐ถ๐ฐ๐ฎ๐๐ถ๐ผ๐ป๐, ๐๐ถ๐ฟ๐ฐ๐๐น๐ฎ๐ฟ๐: Notifications may be issued under Section 112A to define equity-oriented fund criteria, potentially amending Rule 2BA. Circulars, such as Circular No. 11/2025, may clarify ULIP taxation. [img:NpNWd_znb]
๐๐บ๐ฒ๐ป๐ฑ๐บ๐ฒ๐ป๐ ๐๐ผ ๐ฆ๐ฒ๐ฐ๐๐ถ๐ผ๐ป ๐ด๐ณ๐ ๐๐ต๐ฎ๐ป๐ด๐ฒ: The rebate threshold is increased from Rs. 7 lakhs to Rs. 12 lakhs, with the maximum rebate raised from Rs. 25,000 to Rs. 60,000, excluding incomes taxed at special rates (e.g., capital gains under Sections 111A, 112). ๐๐บ๐ฝ๐ฎ๐ฐ๐: This amendment significantly enhances disposable income for middle-class earners, particularly those with incomes up to Rs. 12 lakh, who will have zero tax liability under the new regime. For salaried individuals, with a standard deduction of Rs. 75,000, the effective tax-free income rises to Rs. 12,75,000. This is expected to stimulate consumption, supporting economic growth, and aligns with the government's focus on urban consumption. ๐ฅ๐๐น๐ฒ๐, ๐ก๐ผ๐๐ถ๐ณ๐ถ๐ฐ๐ฎ๐๐ถ๐ผ๐ป๐, ๐๐ถ๐ฟ๐ฐ๐๐น๐ฎ๐ฟ๐: Post-passage, the Central Board of Direct Taxes (CBDT) may issue notifications to clarify rebate applicability, potentially under Rule 26B of the Income Tax Rules, 1962. No specific circulars are mentioned yet, but updates are anticipated. Withdrawal of the Equalisation Levy on Digital Advertisements Finally, the withdrawal of the Equalisation Levy on digital advertisements appears to be in line with the evolving international consensus on the taxation of the digital economy and it may lead to the taxation of these services under the general income tax framework based on the concept of significant economic presence. [img:jhV6Rxytt]
The withdrawal of the Equalisation Levy will impact non-residents providing online advertisement services to Indian customers. They will now need to consider whether their activities constitute a significant economic presence in India and if their income from such services will be subject to income tax in India, potentially impacting their tax planning and compliance obligations. [img:MOUZJfAHz]
๐๐ถ๐ป๐ฎ๐น ๐ฅ๐ฒ๐บ๐ถ๐ป๐ฑ๐ฒ๐ฟ These income tax changes are now in effect! Ensure compliance and adapt your tax strategies accordingly. Businesses & individualsโstay updated and take action! [img:WwXGhZ-QS]
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