The new financial year will start from April 1. Changes in tax rules in the budget will also have an impact on your investments. This also includes taxes from cryptocurrencies to PF contributions.
The new financial year will start from April 1. Changes in tax rules in the budget will also have an impact on your investments. This also includes taxes from cryptocurrencies to PF contributions. Apart from this, parents of disabled children will also get the benefit of tax exemption. Here is the report of Sangeeta Ojha on seven such changes related to your investment
Tax on crypto
The tax regime on crypto in the country will be implemented gradually in the financial year starting from April 1. The rule of 30 percent tax on the earnings from this will be effective at the beginning of the financial year. Whereas the provision related to one percent TDS will be applicable from July 1. Clarity has been brought regarding imposition of income tax on crypto assets in the budget. The TDS limit will be ₹50,000 per annum for specified individuals, including individuals/HUFs who are required to get their accounts audited under the Income Tax Act.
No loss compensation option in crypto
The government has not given an option to compensate for the loss on investment in crypto. If you gain in one crypto and you lose in another, you will not get the benefit of compensation like stocks.
For example, if you make a profit of ₹1,000 on Bitcoin and lose ₹700 on Ethereum, you will have to pay tax on ₹1,000, not your net profit of ₹300. Apart from this, you cannot take advantage of loss compensation in shares, mutual funds or real estate on crypto.
Updated ITR facility
Income Tax Department has given new facility in ITR. Under this, a new provision has been inserted that allows taxpayers to file an updated return for errors or mistakes made in the income tax return. Taxpayers can now file an updated return within two years from the end of the relevant assessment year.
NPS more exemption for state government employee
State government employees will now be able to claim deduction under section 80CCD(2) for NPS contribution up to 14 per cent of their basic pay and dearness allowance by the employer. This is in line with the deduction available to central government employees. At present, state government employees can claim up to 12 per cent.
Tax on pf account
The Central Board of Direct Taxes (CBDT) has decided to implement the Income Tax (25th Amendment) Rules, 2021 from April 1. Under this, you can claim tax exemption only on investment up to Rs 2.50 lakh annually in EPF. In case of excess investment, his interest income will be taxed.
Tax relief on the cost of treatment of corona
As per the June 2021 press release, tax exemption has been provided to persons who have received funds for COVID medical treatment. Similarly, amount up to Rs 10 lakh received by family members on death of a person due to COVID will be tax exempt. This exemption will be available only if the family members receive such payment within 12 months from the date of death. However, this amendment will come into force with effect from April 1, 2020.
Tax exemption to the guardian of the handicapped
A major change in the Income Tax rules is regarding the tax exemption given to the parents of a disabled person. The parents or guardians of the handicapped can take advantage of tax exemption on the insurance policy for such a person.
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