Now investing up to 2.5 lakh PF in a financial year will be tax-free. If you invest more than that, you will have to pay tax on the interest earned.
The new fiscal year is going to start on April 1. With this, many rules related to salaried employees, pensioners, common people and banks will change. Among the rules which are going to change from the first date of next month, there are many rules including the tax on investment in PF, new labour code, income tax return etc. Here are 10 such rules which will change from the new fiscal year.
1. Tax on interest received on PF deposit
The tax was announced on the interest received from the Employees Provident Fund (EPF) in the General Budget 2021-22. Now investing up to 2.5 lakh PF in a financial year will be tax free. If you invest more than that, you will have to pay tax on the interest earned. Meaning if you have deposited four lakh rupees annually, then you will have to pay tax at the rate of your tax slab on the interest earned on a deposit of Rs 1.5 lakh.
2. Changes in the rules related to salary
The government is set to implement the new wage code from April 1. As soon as the new labour code comes into effect, your salary will change. The New Code on Wages will impact the salary of the employees directly. It is said that with the new codes, while your CTC remains the same your take-home salary will go down. Your salary structure may change from the 1st date.
3. Pre-completed Income Tax Return Form
Individual taxpayers will now be provided with a pre-filled return form (pre-filled) before April 1, 2021, for the convenience of the employees and to make the process of filing income tax returns easy. This will make filing returns easier.
4. Freedom for senior citizens from filing returns
From 1 April 2021, citizens above 75 years of age will not have to file income tax returns. This exemption is given to senior citizens who are dependent on pension or fixed deposit (FD) interest. In addition, senior citizens with income sources will have to file returns.
5. Double TDS for non-filing of returns
The government has made changes to section 206AB of the Income Tax Act. Under this, if you do not file ITR now, you will have to pay double TDS from April 1, 2021. According to the new rules, TDS and TCL rates will be 10-20% which is usually 5-10%.
6. Dual air bag will be necessary for the car
Safety standards on cars will be changing since April 1. It will now be compulsory for the driver as well as the side seat to be fitted with airbags.
7. Cheque books of these banks will become useless
If you have a bank account with Dena Bank, Vijaya Bank, Corporation Bank, Andhra Bank, Oriental Bank of Commerce, United Bank of India and Allahabad Bank, your passbook and check book will become worthless from 1 April 2021. This change is happening due to the merger of these seven public sector banks into various other banks.
8. Pension fund managers will charge more fees
It is important for you to know if you invest in a pension fund. The Pension Fund Regulatory and Development Authority (PFRDA) has allowed the Pension Fund Manager (PFM) to charge higher fees to its customers from 1 April. This move can attract more foreign investment in this sector.
9. You will not be able to hide your income
So far only things like salary and provident funds are tracked through PAN card. Due to which mutual fund and other earning system cannot be tracked automatically, but after PAN and Aadhaar will be linked from April 1, after that you will not be able to hide any investment. Due to Aadhaar and PAN link, the system will automatically track your investment.
10. The rule for late return filing will change
Due to the Coronavirus epidemic, the period of filing of revised or delayed ITR of FY 2019-20 was extended. However, once again the Central Government has changed the rules under the Finance Bill-2021. According to this, if you file a late income tax return, then late April 1, 2021, will have to pay a late fee.
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