New income tax rules: Learn about the significant changes in the ITR that will take effect on April 1st
Under the Income-tax (25th Amendment) Rule 2021, the Central Board of Direct Taxes (CBDT) will implement a host of important modifications to the income tax beginning April 1.
One of the most significant developments in the non-crypto sector is the imposition of a limit on tax-free contributions to the Employee Provident Fund (EPF) account of Rs 2.5 lakh.
CHANGES IN ITR
Another significant adjustment has been made to the income tax return. Taxpayers will now be able to file an amended return for errors or inaccuracies in income tax returns within two years of the end of the relevant assessment year.
Previously, there was only a 5-month window from the due date of filing returns to alter tax returns. However, it will be unable to file an amended return to indicate any new loss or drop in tax due.
This provision was expressly designed to give a chance to people who overlooked or underreported income or had any other error that resulted in less tax filing in the initial tax return.
Dividends received from mutual funds or domestic corporations will now be taxed. Investors in higher tax rates will have a larger tax burden, while those in lower tax levels would face a lesser tax burden.
TAX ON CRYPTO EXCHANGES
Finally, the taxation of digital assets, including crypto money, has sparked the most outrage among investors. During the Union Budget Session 2022, Finance Minister Nirmala Sitharaman revealed that a flat 30% tax will be paid on any gain gained from digital assets such as cryptocurrency.
While investors will be charged in this manner, recipients of digital assets will also be taxed. Under certain scenarios, the recipient who received digital assets as a gift may be required to pay 1% TDS and gift tax.