https://x.com/SrikantMatrubai/status/1882820556770492520?s=35
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LTCG tax
collection by Govt 🔥
2017-18 : ₹0 Crore
2018-19 : ₹29220.00 Cr
2021-22 : ₹86,075.49 Cr
2022-23 : ₹98,681.34 Cr
Reason is tax rates on LTCG 🚀
in Budget 2017 : 0%
In 2018 Budget : 10%
In 2024 Budget : 12.5%
⁉️ 2025 Budget.
A farmer does F&O, makes losses & gets 69 cr tax bill! Why? He didn't report it in the ITR. In F&O, turnover not profit goes to IT Dept. This led to a notice he didn't see & ex parte assessment. Now wants to appeal but must deposit 20% of amount, which he doesn't have.
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The Central Board of Direct Taxes (CBDT) has extended the last date for filing belated/revised income tax returns (ITR) for the Assessment Year (AY) 2024-25 for resident individuals, as stated in a notification issued by the CBDT. The deadline has been extended from December 31, 2024 to January 15, 2025.
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Are you paying rent in cash?
My friend Vinayak did the same last financial year. (And was shocked)
He paid Rs.20,000 as rent every month. Half in cash, half via online transfer.
Tax season came and he claimed the full Rs.2.4L (20,000 p.m) as HRA exemption.
Fast forward to a few weeks- His HRA exemption was disallowed.
Take a guess why this would have happened.
He filed on time
He disclosed his true rent
Yet disallowed?
Well, what happened was, his landlord didn't report the cash rent payment. Only 1.2L (10,000 p.m)
This caused a mismatch between what Vinayak claimed as rent (2.4L) and what was actually reported (1.2L)
He didnt know that - if the rent you claim is higher than what your landlord shows, the tax department may disallow a portion of your HRA exemption. And that means paying more tax than expected.
The same happened with Vinayak.
He told me about this incident. So I told him, going forward if you are claiming HRA, ensure:
>Pay 100% rent via NEFT, UPI
>Get receipts with payment mode & date
>Inform landlord of rent amount in your ITR
I've seen many salaried people lose HRA exemptions this way. Don't let it happen to you.
Tax filing season is here. Be diligent.
Your savings are key to your dreams. Protect them.
These components in cost-to-company structure are tax-exempt✅
🔸Meal coupons
🔸Mobile bill reimbursement
🔸Gift voucher
🔸Children’ education & hostel allowance
🔸Car expenses reimbursement
🚨🚨 The *EPFO's new rule* allows salaried individuals to automatically transfer their PF balance — *from old employer to new*— when they switch jobs.
Here's all you need to know ⬇️
https://www.cnbctv18.com/personal-finance/epfo-new-rule-april-automatic-provident-fund-account-transfer-online-passbook-balance-19394283.htm?utm_medium=social&utm_source=whatsapp&utm_campaign=regular-editorial
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Genuine Question raised by a tax payer!🤔
But then standards of Government hospitals in India are abysmally low, public transportation is awful..the taxes paid are going to fill the coffers of the corrupt or used to write off loans of corporates.
No benefits for the salaried class living in India!
Yes, You can still save some INTEREST on paying your ADVANCE TAX by 31st March, 2024.
This is only applicable if your advance tax liability exceeds Rs. 10k.
Interest for not paying advance tax on time is levied under two sections:
1. Section 234B - (1% Interest per month is levied if 90% of assessed advance tax is not paid by 31st March 2024 and interest is charged from assessment year i.e. April 2024)
2. Section 234C - (Levied if advance tax is not paid in prescribed percentages quarterly)
Let's discuss two hacks by which you can plan and save some interest now as well.
"SAVE YOUR INTEREST ON ADVANCE TAX - HACK 1"
Let's understand it with an example
Say, for FY 23-24, your total tax liability is roughly 5 Lakhs and TDS/TCS of Rs. 3 Lakhs is already deducted.
So, your resultant advance tax liability from the above equation comes to Rs. 2 Lakhs.
Interest for not paying advance time on time quarterly will be calculated on this 2 Lakh.
Now, ask your employer to deduct higher TDS for the month of March 2024 and pay you less "in-hand" salary, so that your resultant advance tax liability is less and accordingly, the interest chargeable on quarterly instalments can be brought down.
So, if the employer deducts an extra TDS of 1.5 Lakhs from above, your advance tax liability will now be 50k instead of 2 Lakhs.
So, quarterly interest will be levied on 50k rather than 2 Lakhs.
This will significantly cut down your interest under section 234C wherein you were required to pay advance tax quarterly up to 15%, 45%, 75% and 100% by 15th June, 15th September, 15th December and 15th March.
Similarly, it will reduce your tax liability under section 234B as well wherein if you don't pay your advance tax by year-end, 1% is charged every month from the start of the assessment year i.e. April 2024.
So, in this example, instead of interest of Rs. 2000 per month, you will only pay Rs. 500 under section 234B
"SAVE YOUR INTEREST ON ADVANCE TAX - HACK 2"
Now, suppose, if your employer does not agree to deduct additional TDS as mentioned above and your advance tax liability is Rs. 2 Lakhs.
Then, in this case, you cannot save any interest on the shortfall relating to quarterly instalments i.e. under section 234C but you can pay at least 90% of 2 Lakhs i.e. 1.8 Lakhs as advance tax by 31st March 2024 and you will be charged no interest under section 234B i.e. 1% per month from April 2024 onwards till you pay your tax in full along with filing of income tax return.
So, if you pay now before 31st March 2024, you will save Interest of Rs. 8000 (2000*4 months) assuming you would have paid & filed ITR by July 2024 which is the original due date for filing an income tax return for FY 23-24 (AY 24-25) for non audit assesses.
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Donald Trump is back
Whats the impact on Stock Markets?
Find out !!!
*Beware of switch costs in MF plans*
There are some investment decisions that we took in the past that we would like to modify now. Switching from a regular plan to a direct plan in an equity mutual fund is one such decision. In this article, we discuss the factors you must consider before you make such a switch.
*_Tax effect_*
Mutual funds offer two plans — regular plan and direct plan. Suppose you invest in a large-cap active fund of an asset management company (AMC). If you make the investment through a distributor, you typically invest in a regular plan. When you make the investment directly with the AMC, you invest in a direct plan.
Distributors need incentive to market mutual fund products of an AMC. Therefore, AMCs pay commission to distributors when you invest in a fund and for every year you stay invested in the fund. This commission comes from the fee that an AMC charges you. Hence, the regular plan will carry a higher fee than a direct plan. The portfolio and the fund manager for both direct and regular plans are the same.
What if you want to switch from a regular plan to a direct plan? The process is easy, but you must be mindful of the related cost. This is because your switch is considered as redemption of the regular plan and fresh investment in the same fund through the direct plan.
That would attract capital gains tax. If your redemption involves investments that you have carried for more than 12 months, then you must pay long term capital gains tax at 12.5% if your gains are above ₹1.25 lakh in a year.
For investments with holding period of less than 12 months, you must pay 20% short-term capital gains tax. So, you must consider the tax effect of the switch.
*_Summing Up_*
If the amount involved falls within the 1.25 lakh exemption limit for long term capital gains tax, you can consider switching in any year. Suppose the amount exceeds that level or you are required to redeemed other investments during the same year to meet a life goal. In such cases, you must stop the current systematic investment plan (SIP) on the regular plan and start a new SIP on the same fund through the direct plan. You can switch the accumulated investments from the regular plan to the direct plan subsequently when related long-term capital gains tax falls within the annual exemption limit.
What is a belated ITR?
Typically, individuals are required to file their ITRs by July 31, 2024.
However, you can come out clean by filing a belated ITR by December 31, 2024.
This deadline has been extended to January 15, 2024 for resident individuals.
Income Tax : Senior citizens can avail the benefit of short-term capital gains u/s 80C?
Read further 👇🏿
https://www.informalnewz.com/income-tax-senior-citizens-can-avail-the-benefit-of-short-term-capital-gains-under-section-80c-know-the-rules/
*Govt may review tax sops offered to IFSC*
The government may have to take a relook at the tax incentives being offered to units in the International Financial Services Centre (IFSC), a new financial hub in Gujarat, in view of Pillar Two of the Base Erosion Profit Sharing framework, according to a Deloitte report.
"MNE groups having operations in the GIFT (Gujarat International Financial Tech) City will need to evaluate the overall tax impact in India, pursuant to the Pillar Two Globe Rules," the report said.
A group having non-IFSC presence along with a unit in IFSC may be able to benefit from the jurisdictional blending at India level, it said.
It suggested offering incentives in other forms to keep the attractiveness of IFSC intact.
Pillar Two sets out global minimum tax rules aiming to ensure that large MNCs pay a minimum effective rate of tax of 15% on profits in all countries.
The report pointed out that units in IFSC may not have enough employees and assets to avail of the benefits, so these units will need to evaluate the overall tax impact in India, after the Pillar Two Globe Rules.
Conglomerates from the financial services industry that have set up base in the GIFT City are incentivised with tax holiday benefits for a period of 10 out of 15 years, and a lower rate of alternate minimum taxes at 9%, along with surcharge and cess, which brings down the effective tax rate to below 15% .
This means their resident countries can apply top up tax on the income from IFSC.
While the majority of European countries have already announced the Pillar 2 framework, India is expected to announce steps in this direction in its full budget in July.
"The Pillar 2 overhang continues to dog policy makers in India," said Rohinton Sidhwa, partner - direct tax, Deloitte.
"It's possible that India could potentially be tempted to look at ways to unilaterally also boost gains from Pillar 2, albeit staying within the overall consensus," he said.
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Benefits in the new tax regime for surcharge
Taxable income above ₹ 5 Crore will attract surcharge only at 25%, not 37%
File ITR on time to claim old tax regime benefit:
If you are planning to opt for old tax regime while filing income tax return this year, ensure that ITR is filed before the July 31 deadline expires.
This is because the new tax regime is the default option and income tax rules allow an individual to opt for the old tax regime only if ITR is filed on time.
If an individual files a belated ITR (between August 1 and December 31), If an individual files a belated ITR (between August 1 and December 31), then tax liability will be calculated only on the basis of the new tax regime.
CBDT PRESS RELEASE: For the first time in recent times, CBDT has enabled taxpayers to file their Income Tax Returns (ITRs) for AY 2024-25 (relevant to FY 2023-24) on the first day of the new FY (1st April onwards)!
A giant step towards ease of compliance & seamless taxpayer services!
✅ITR-1, ITR-2, ITR-4 & ITR-6 are available to taxpayers on the e-filing portal from 1st April, 2024 onwards.
About 23,000 ITRs for AY 2024-25 already filed.
✅CBDT had earlier notified the ITR forms in December, 2023, and January, 2024.
✅ITR-3, ITR-5 & ITR-7 will be made available shortly.
Do you keep a check of losses that you carry forward in your income tax returns?
Not all losses can be carried forward for 8 years.
One such loss is under the category of "Speculative Loss" where you can carry forward the loss only for "Four Years" and not Eight.
Intraday trading qualifies in the category of "Speculative Business"
Speculative losses can be set off only with speculative gains. In case, you don't set off those speculative losses with speculative gains, it will get lapsed.
Most people make either of these 2 mistakes
Mistake No. 1: Not carrying forward the past losses in ITR which is very commonly known.
Mistake No. 2: Not being conscious of the loss that happened 4 years back which may lapse by the end of the 4th year which they realize after the close of the financial year at the time of filing the ITR.
What you can do now to avoid Mistake No. 2?
Check Schedule CFL in the ITR form of the last financial year (AY 2023-2024) that you have filed and check if there is any "loss from speculative business". If Yes, check if you have any loss in AY 2020-2021.
If Yes, You can set off those losses with speculative gains by 31st March 2024.
If you don't, it will be lapsed.
Many people are aware of the law relating to 4 years but forget about it practically only to remember it while filing their taxes in July/October after the close of the financial year by then it gets very very late to claim loss of that 4th year preceding the current financial year.
For easy understanding and which box to check, see the screenshot attached to this write-up.
Keep this thing as a part of your "Annual Tax Check-Up" just like you check for your other deductions.
#IncomeTax
