Three major changes in income tax rules proposed in the Union Budget 2022 came into effect from July 1 Every taxpayer should know about these latest updates
Three notable changes relate to Aadhaar-PAN linking, crypto investments and social media influencers and benefits received by doctors.
As per changes in income tax rules, the late fee for Aadhaar-PAN linking has been increased, and social media influencers as well as doctors will have to pay an additional 10 percent TDS on benefits received from sales promotions. 1 percent TDS is also payable on cryptocurrency investments.
The government has set various limits on cash transactions to prevent black money. Know cash transactions that may invite serious penalties.
Let’s have a look at the changes in detail.
PAN-Aadhaar Linking Late Fee:
The last date for Aadhaar-PAN linking was June 30. According to the Central Board of Direct Taxes (CBDT), those who fail to link Aadhaar with PAN will now have to pay a penalty of Rs 1,000.
The increased late fees came into effect from July 1. Earlier, CBDT had allowed linking of Aadhaar and PAN between March 31 and June 30 with a late fee of Rs 500.
TDS on Cryptocurrency:
Investments in virtual digital assets (VDAs) above Rs 10,000, including cryptocurrencies, will be subject to a 1 percent tax deduction at source from July 1. Percentage TDS on crypto investments.
Cryptocurrency transactions proposed in the Union Budget will be subject to a flat 30 percent tax in addition to 1 percent TDS
TDS will also be applicable on NFT transactions above Rs 10,000. Section 47A of the IT Act defines VDA as any data, code, number or token other than Indian or any other foreign currency created by cryptographic or other means.
However, refund can be claimed for TDS on transactions involving losses. Hence, experts advise you to report your cryptocurrency investment in your ITR filing.
Tax on benefits received by doctors and influentials:
As proposed in the Union Budget, Section 194R has been inserted in the IT Act, 1961. In the Union Budget 2022, the government included a new section 194R in the Income Tax Act, 1961.
According to the new section, 10 percent TDS will be levied on benefits received from sales promotions by doctors and social media influencers. TDS will be applicable on benefits exceeding Rs 20,000 in a financial year.
Doctors who receive samples from drug manufacturers will have to pay 10 per cent TDS once the total amount exceeds Rs 20,000 in a financial year.
However, this will not apply to doctors in government service.
Other changes: For cash deposits above ₹ 20 lakh in a year, changes in rules
Cash transactions have traditionally played an important role in the Indian economy and are a constant source of black money accumulation, so the government has set various limits.
Deadline for filing IT return:
The deadline for filing income tax returns is July 30 and is unlikely to be extended.
Every person, whose annual income is above the exemption limit, has to pay tax. Income tax (IT) is levied based on a slab system, meaning the rates vary according to income levels. Tax rates change as income increases.
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