Startups have long demanded that tax on Esops must be levied only at the time of sale and not at the time of vesting, as valuation of new ventures remains volatile even as opportunities to sell are rare.
This will make it easier for tax authorities to determine residential status of such individuals without asking for passport copies. Individuals may not have to hold their old passports as proof of physical presence in earlier years in India if their ITR is processed.
While there is no change in existing income-tax slab rates for individuals, a new tax regime has been proposed in Budget 2020, under which individual taxpayers foregoing exemptions and deductions would be taxed at reduced rates. Here are other major announcements.
Most of the commonly available deductions such as section 80C, 80D, standard deduction etc. have been proposed to be removed but here is one tax benefit that can still be claimed by you under the new tax regime.
Under the proposed ‘Vivad Se Vishwas’ scheme, a taxpayer would be required to pay only the amount of the disputed taxes and will get a complete waiver of interest and penalty provided he/she pays by 31st March 2020.
This is good news for employees of start-ups having ESOPs. Currently, the taxation of ESOPs is split into two components - (i) at the time of allotment of shares from the startups and (ii) as capital gains.
In order to ease the process of claiming deduction for donation, it is proposed to pre-fill the donee’s information in taxpayer’s return on the basis of information of donations furnished by the donee.
As per income tax laws, an individual can claim interest paid on housing loan as a deduction from gross total income. The amount of interest which can be claimed as deduction is currently capped at Rs 3.5 lakh
Digital frauds are on the rise and taxpayers too are not safe from it. To help you, the income tax department has released a list of trustworthy sources that a taxpayer should make a note of. Do not just trust any other source.
Different sections under the Income-Tax Act correspond to different savings or expenses, some of which are eligible for tax deductions and could be a great way to show that you are actually out of the taxable bracket. Here are 8 such deductions.
For the home loan taken, the interest paid to the bank can be claimed as a deduction for a maximum of Rs 2 lakh under section 24. Further, the principal component also offers tax benefit under section 80C.
After notifying the income tax return forms for FY 2019-20, which reduced the number of individuals who can file the ITR-1, CBDT has now rolled back such restrictions. Here's a look at who can file a tax return using ITR-1 for FY 2019-20.
The income tax department, via its Twitter handle and emails, has been informing taxpayers about the important tax dates for the year 2020. Being mindful of these dates can help taxpayers avoid penal consequences.
Long term capital gains accrued from selling equity shares and equity-oriented mutual funds are exempt from tax for maximum up to Rs 1 lakh in a financial year. The gains in excess of Rs 1 lakh are chargeable at the rate of flat 10 percent.
The government has extended the deadline to link PAN with Aadhaar once again. The last time deadline was extended in September 2019 by three months to December 31, 2019. If the PAN is not linked with Aadhaar by March 31st, then PAN will become inoperative.
Based on a clarification received from IRDAI, it is hereby clarified that annuity payable by ASPs NRIs and OCIs will be taxed at source, at rates applicable as per the DTAA of the country where the annuitant resided.
You can optimise tax by rejigging your income and investments. In this taxpayer's case, there is scope for further tax reduction if he makes use of all the deductions available. For instance, he should invest in NPS on his own too.
The law of levying late filing fees under section 234F became effective from the financial year 2017-18 or assessment year 2018-19 onward. However, if your income is below the taxable limit, then you do not have to pay a late filing fee.
Income tax is a tax levied directly by the central government on the incomes earned by the individuals and other non-individual entities such as Hindu Undivided Family (HUF), partnership firm and so on during a financial year. These various sources of income include salary, pension, capital gains, sale of financial investments, interest income, other incomes and so on.
Unlike the Goods and Services Tax (GST) Council where the Union Finance Minister and State Finance Ministers decide the rates, the income tax rates are announced by the Finance Minister during the year’s Union Budget.
The rate at which your total income earned during the year will be taxed depends on the slab in which your income falls. Over and above the income tax, a cess and surcharge is levied. The cess is payable by all taxpayers. For those earning more than Rs 50 lakh a year, a surcharge is levied between 10 percent and 37 percent.
The total income earned by a taxpayer during a financial year has to be reported to the government in the assessment year by filing income tax return (ITR filing).
Financial year is the year in which income is earned by a taxpayer; a financial year is between April 1 and March 31. Assessment year is the year immediately following the financial year for which the return is to be filed.
Income earned from various sources such as salary, pension, interest from fixed deposits (FDs), savings account, capital gains from sale of house, equity mutual funds, debt mutual funds and so on have to be reported in ITR.
1. What is the basic exemption limit for individuals aged below 60 years? According to income tax laws, it is mandatory to file ITR if your income exceeds the basic exemption level. The basic exemption level depends on the age of the individual during the financial year.
Currently, for individuals below 60 years of age, the maximum income exempt from tax is Rs 2.5 lakh in a financial year. This can change depending on the announcements made in the Union Budget.
2. What are the tax rates at which income is charged? The income tax slab rates are 5 percent, 20 percent, and 30 percent.
Also Read:Latest income tax slabs
3. How to file income tax return An individual can file income tax return by registering himself on the incometaxindiaefiling.gov.in or via private e-filing websites.
4. What is the difference between gross total income and net total income? Gross total income refers to the total income earned by the taxpayer. Income tax laws allow an individual to claim certain tax-exemptions (such as house rent allowance) and deductions under various sections such as section 80C for investments made in Public Provident Fund, equity mutual funds etc. of up to Rs 1.5 lakh.
Gross total income minus tax-exemptions and deductions would result in net total income. The tax liability of the person will be calculated on the net total income.
5. What is the last date to file income tax return? The last date to file income tax return for individuals is July 31, unless extended by the government.