Budget 2021

These 5 major changes related to tax in the budget, they will have a direct impact on your pocket

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Many important changes have been made in this time budget regarding income tax. Now people above 75 years of age will not need to file returns. Apart from this, interest on PF is included in taxable income. We are telling you about 5 such important changes that you may need to know.

Limit on tax free interest on PF

Interest on PF is included in taxable income. Employees who contribute 2.5 lakh rupees or more in PF will now have to pay more tax. The interest they receive will be included in the taxable income. This limit will apply to contributions made on or after 1 April 2021.

No need to return if you are over 75 years old

Those over 75 years of age will no longer need to file tax returns. According to the new rule, people above the age of 75 years will not be required to pay ITR, which is dependent only on pension or bank interest income. If they are earning from other sources too, whether it is rent or anything else, they will be obliged to fill ITR as usual.

Now filling ITR will be easier

Till now, while filling the ITR, we had already received information like name, address, tax on salary, payment of tax, TDS in the form. This has been made even easier by an announcement in the budget. Now the information of capital gains from securities listed, information on dividend income and interest received from bank-post office will also be filled in advance.

Now only 3 year old tax returns will be open

In tax evasion cases of income below 50 lakh, the time limit for opening old returns has been reduced from 6 years to 3 years. With this, only 10 year old returns can be opened on the evidence of more than 50 lakh tax evasion. The permission of the Principal Commissioner of Income Tax will also be required for this.

Over 2.5 lakh ULIP premiums to be taxed

The budget limits the tax exemption available under section 10 (10d) on the premium of unit-linked insurance plans (ULIPs). If the premium is more than 2.5 lakh rupees, there will be no tax exemption. While this will not apply to existing ULIPs, it will be effective only on policies taken after 1 February 2021. ULIP is a product where insurance and investment benefits come together.

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