Saturday, April 1, 2017
10 Income Tax Rules That Will Come Into Effect From 1 April
Amendments in several government rules and regulations will come into force on 1 April 2017, the start of the new financial year. The Income Tax regulations that will come into effect can be broadly divided into two parts. First, the rules for filing I-T returns and second, the rules for calculating I-T.
1. It is now mandatory to disclose the Aadhaar number while filing I-T returns. This is the most important amendment in the rules for filing I-T. Till last year, it was optional to disclose the Aadhaar number while filing the returns. Generally, the last date for filing I-T returns is 31 July. Therefore, it is advisable for tax payers to get their Aadhaar number at the earliest.
2. Another important amendment that comes into effect from the financial year 2017-18, is the provision of penalty in case the return is filed late. According to this provision, if the return is not filed till 31 December, the tax payer has to pay the penalty of Rs 5,000. If the tax payer files the return after 31 December, a penalty of Rs 10,000 will be imposed. However, the penalty has been restricted to Rs 1,000 for income of up to Rs 5 lakh.
3. Only a one-page tax return form will be provided for salaried tax payers with income up to Rs 50 lakh. The source of their income can be their salary and rental income from only one house. If the tax payer has more sources of income, he cannot file his return through a one-page tax return form. Those earning up to Rs 5 lakh and filing return for the first time will be free from scrutiny.
1. Income tax for those earning between Rs 2.5 lakh to Rs 5 lakh has been slashed to 5 percent. This will result in an annual saving of up to Rs 12,500 for the maximum number of tax payers. However, this saving will rise up to Rs 15,000 for tax payers who earn Rs 1 crore or more annually, if the surcharge and cess is added.
2. After having executed the amendments in the tax rebate rules, under section 87 A, only tax payers with an annual income of Rs 3.5 lakh will be benefitted. Up till now, tax rebate benefit of up to Rs 5,000 was allowed for tax payers with an annual income of Rs 5 lakh. The rebate has also been reduced to Rs 2,500.