Finance Minister Nirmala Sitaraman made an announcement regarding slight alteration in the income tax rules in the budget on February 1, 2021.
These changes will come into force from April 1. The new rules include letting off people to file ITR having pension and interest earned from fixed deposit.
These people should be of and over the age of 75 and have these income sources in the same bank account. The other rule suggests higher TDS to the people who are not filing the ITR.
People who have annual input of Rs 2.5lakhs to the EPF will have to pay tax. The aim is to charge tax to people with a higher value of the contribution to the EPF account. Therefore people earning less than Rs 2 lakhs income annually will not have to pay tax.
The introduction of new sections which are Sections 206AB and 206CCA aims at the deduction of higher TDS or TCS rates to the non-filers of ITR. As a result, it will encourage more people to file an income tax return.
Additionally, according to the new changes, it will be easier for people to file returns. Now the taxpayers will get a pre-filled ITR form. It also comprises prior filling other details like capital gains, interest earned and dividend income, etc.
Last year government made an announcement regarding Leave Travel Concession. The budget 2021 formulates a rule for LTC. It contains the provision of tax exemption for those who couldn’t claim the LTC benefit because of the Covid-19 situation.
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