The 1st Budget of the Narendra Modi government was hailed as the harbinger of acche din. It gave a bonanza to taxpayers by simultaneously increasing the basic exemption limit and the tax deduction under Sec 80C. However, the subsequent Budgets have not been so generous. While some more deductions have been offered to taxpayers, Budgets have also taken away some tax benefits or levied additional taxes. The 2015 Budget, for instance, was not too friendly to the super rich in particular. The surcharge of 10% on incomes above Rs 1 crore was increased from 12% to 15%. The next year, a 10% surcharge was introduced for incomes between Rs 50 lakh and Rs 1 crore. The final blow came last year in the form of 10% tax on LTCG from equity investments exceeding Rs 1 lakh in a year. At the same time, the Modi government has done away with some anachronisms. It abolished the wealth tax, and hiked the deduction limit from Rs 2,000 to Rs 5,000 a month under Section 80GG for those who don’t get … [Read more...] about Will interim Budget 2019 reduce your tax?
Investment loss tax deduction
Budget 2020 has proposed a new lower income tax rate regime which is optional in nature. The option of lower income tax rates (sans tax-exemptions and deductions) under the new regime can be exercised by an individual at the time of filing of income tax return (ITR) as per the Finance Bill, 2020. However, there is no clarity in the Finance Bill regarding the calculation and deduction of tax at source by the employer at the time of paying salary. If an employee informs his/her employer at the start of the financial year about opting for the proposed new tax regime, will he/she be allowed to switch to the existing tax regime during the year and vice versa? Remember, individual taxpayers having no business income in a financial year have the option to choose between the existing tax regime and new one every financial year as per their convenience. How does an employer know in advance as to which tax rates to use to calculate each employee's estimated tax liability for the purpose of … [Read more...] about Govt needs to clarify how TDS from salary will work in new income tax regime: Experts
Income Tax Deductions and ExemptionsThough government levies tax on all kind of income and profits generated by individuals and businesses, it also offers various tax deductions and exemptions. If any individual spends money on the prescribed investment schemes ruled by the Income Tax Law, he/she becomes eligible to claim an exemption on that investment. The individuals can claim exemption of a certain amount of money spent on medical insurance, child's education, ELLS funds, tax saving bonds, FDs, Pension Funds etc. … [Read more...] about Income Tax Slab & Rate FY 2020-21
By Alok Mundra and Shital Gharge While the Indian economy had been facing headwinds like growth slowdown, liquidity squeeze, lack of private investment revival and consumer confidence, the investors are hoping to see turnaround in the overall environment. Budget 2020 was expected to address a number of these issues to stimulate growth and put economy back on roll. The Finance Minister had woven her budget speech around three major aspects of aspirational India, economic development and caring society. The private equity industry being one of the major contributors of foreign investments in India, amongst other growth drivers had anticipated certain tax reforms, to form a part of Budget 2020. Their key wish list consisted of the following: Abolishment of Dividend Distribution Tax (DDT); Reinstate exemption of long-term capital gain tax on sale of listed securities or at least removal of Securities Transaction Tax; Availability of faster and simplified dispute resolution mechanism; … [Read more...] about Impact on alternative investment industry: Some hits and misses from recent policy announcements
Two, the government has also been signalling that you need to save in your own interest and not merely to get the carrots (read tax benefits). For example, by reducing the high interest deduction and claiming set-off on loss on house property a few years ago, the government signalled that you cannot use tax benefit to invest in any number of properties. … [Read more...] about On the tax path less trodden