The new budget passed from Parliament will come into effect from Tuesday i.e. April 1, 2025. Many benefits ranging from income tax to subsidy will be implemented from this date. From April 1, the rule of tax free income will be implemented on earnings up to 12 lakhs. The income tax of 6 lakh rupees will be made free. Senior Cities will double the discount on interest income. There are many changes in the rules of increasing the TCS limit, changes in the rules of filing updated returns, GST and NPCI rules are also going to happen. Let us try to understand them in detail.
Under the New Tax Regim, no tax will have to be paid on earnings up to Rs 12 lakh. This discount will be Rs 12.75 lakhs with standard deduction of 75 thousand for employed people. A new slab of 25% tax has also been included in the new tax regime for income of 20 to 24 lakhs.
Effect: Earlier, the maximum rate of 30% used to apply to income above Rs 15 lakh, but now this limit has been increased to Rs 24 lakh. This will save medium and high-middle income group in tax.
Rebate on rent from rent double: Which has been increased from 2.4 lakh rupees to 6 lakh rupees.
Senior citizens double on interest income: For senior citizens earning interest income from bank FD, the TDS limit has increased from ₹ 50 thousand to ₹ 1 lakh.
TDS limit on professional service: The limit of TDS on professional service has now increased from 30 thousand to 50 thousand.
What will be the effect: This will reduce the burden of TDS on low -income persons and improve cash flow.
What has changed: The tax collected at source (TCS) limit has now increased from Rs 7 lakh to Rs 10 lakh on sending money for studies abroad. On the other hand, if money has been taken from any financial organization like bank etc., TCS will not be attached.
Effect: The removal of TCS will benefit both students and their families. Earlier, 0.5% -5% TCS was deducted on the amount of more than 7 lakhs. This made the transfer process a little hectic. At the same time, the entire amount of up to 10 lakh rupees will be reached at the other end.
The change happened: Now taxpayers will be able to file updated returns for 48 months instead of 24 months from the end of the assessment year. It has some conditions. Firstly, 60 percent additional tax on returns filed between 24 and 36 months. The second condition is that 70% additional tax will be applicable on returns filed between 36 and 48 months.
Effect: This will give taxpayers more time to improve their mistakes. Voluntary compliance will also increase. That is, to follow the rules, laws of an individual or organization.
shift: If the premium of Unit Linked Insurance Plan is more than Rs 2.5 lakh per year, it will be considered a capital asset. Capital gains tax will be levied at any benefit caused by capitalizing such ULIPs. ULIP is a product in which a part of the premium is invested in the stock market. If it is kept for more than 12 months, it will be taxed as a long term capital gain (LTCG). If it is kept for less than 12 months, it will be taxed as 20% tax in the form of short term capital gains (STCG).
Effect: Those investing in high premium ULIP will now have to pay tax. The government has made these changes to prevent high-income tax payers from using ULIPs as tax-free investment instruments. A large part of the ULIP premium is invested in the stock market, so the government argued that it should not get tax exemption like traditional insurance.
shift : In the budget presented in February, the government had reduced custom duty on some products and increased on some. About 150-200 products will be affected by this. Generally, changes in custom duty are applicable from the beginning of the financial year i.e. 1 April 2025.
However, the dates for the implementation of certain changes depend on the notifications of the Central Indirect Taxes and Customs Board (CBIC). For example, in the previous budget, some custom duty changes (such as mobile phones and precious metals) came into force from 24 July 2024.
Effect: Some things can be cheap and some expensive. The indirect impact of the reduction of custom duty has on the prices of things.
Items that can be expensive: Smart meter solar cells, imported shoes, imported candles, imported boats and other ships, PVC Flex Films, PVC Flex Sheets, PVC Flex Banner, Cloth made of Neeting Process, LCD/LED TV
Social welfare schemes such as cash assistance for farmers, schemes for women, or employment schemes can start benefiting from June-July. Projects like road, rail, or school-hospital take time to benefit, because they have a process of planning, tender and construction.
The government is going to start track and trace mechanism to catch GST theft in the new FY 2025-26 starting from April 1. The track and trace mechanism was announced in the budget presented in July for the current financial year. Although the notification regarding this mechanism has not been issued till now, but till date it can be released. With this, these mechanisms will be implemented from April 1. Track and trace mechanism will be used by the GST authority for certain types of goods. In addition to the FMCG sector, tobacco related items, this mechanism will be used for the entire supply chain of the drug and toilet items. The sale of this type of goods is being found less than the actual supply. Under the mechanism, the information will be with the government, from the release of goods from the factory to reach the retail shop.
The GST department will give its software to manufacturers of such items and make special codes for selected items. That code will be connected to the software that will not be rigged in the information of the supply of goods.
If the manufacturers of goods coming under track and trace mechanism do not adopt it, then you may have to pay a fine of at least one lakh rupees. Changes in GST rules from April 1 will be mandatory to give information on the Inveus Registration Portal within 30 days of the release of the e-invoices to the businessmen who are doing business of more than 10 crores annually from April 1. Earlier there was no time limit to give such information.
Old users have to update the identity: From April 1, they will have to inform the GST portal users for the strong identity. Older users also have to update their identity. Apart from this, if a businessman has registered several registration of GST in different states from a PAN number, then it will be mandatory for such a businessman to register as input service distributors for distribution of input tax credit.
The National Payments Corporation of India (NPCI) has issued new rules to increase the security and effectiveness of UPI transactions. These rules are being implemented from April 1. According to this, if you do not use your mobile number for 90 days, then the telecom company can give that number to another person.
This means that if you have linked the UPI with the old mobile number and that number is closed, then your UPI ID will not work. That is, you will not be able to use UPI services.
We will check and update at least once a week: From April 1, bank and UPI app will check the mobile number records of customers at least once a week and update, so that the changed mobile numbers do not cause wrong transactions.
Update your mobile number in the bank so that UPI services are operational.
If the number has changed recently, then register a new number in the bank soon.
Keep using the bank registered number so that it is not affected by the passive and UPI services.
Collecting payment feature will end: NPCI has recently started the process of removing the collecting payment feature to reduce fraud. Now this feature surf will be limited to large and verified traders. Its limit will be increased to Rs 2,000 in personal transactions.
