7 Major Changes In Income Tax Rules In effect From April 1

Income Tax Rules For New Financial Year

With the start of the new Financial Year 2022-23, we are going to witness some major changes in Income Tax Rules. The government is taking crucial decisions at a rapid pace that urges you to keep yourself updated in time. Your financial life is going to change from today, with the addition of new rules and with the modifications of existing ones.

7 Major Changes In Income Tax Rules For FY:22-23

Digital Assets (Crypto) Becomes Taxable

From April 1 all the forms of digital assets that generate profit will attract a tax of 30 per cent. This announcement was made by our Financial Minister Nirmala Sitharaman in her budget speech. However, the TDS of 1 per cent will be applicable from July 1.

As per Livemint, “The threshold limit for TDS would be ₹50,000 a year for specified persons, which include individuals/HUFs who are required to get their accounts audited under the I-T Act, Livemint reported.”

Crypto Losses Cannot Be Set off Against Any Form Of Digital Gains

The tax on crypto gains will be paid no matter the losses incurred in any other version of crypto holdings. As per the strict Income Tax rules a person cannot set off losses incurred in a particular digital asset against any other form of digital gains. For example, a person gains Rs.1000 on Bitcoin and loses Rs.700 in Ethereum, then he has to pay tax on Rs.1000 only and not on his net profit of Rs.300.

Updated ITR To Eliminate Errors

As per a new provision the Government has allowed the taxpayers to file an updated ITR against the errors and mistakes done in the initial income tax return. Now Taxpayers are allowed to file updated ITR within two years starting from the end of the assessment year.

NPS Deduction

Employees of The State Government can now claim the deductions for their NPS contributions under Section 80CCD(2). However, they can claim up to 14 per cent of their basic salary and DA.

Also read:

File ITR Of Deceased Person This Way?

Taxable PF Account

As decided by The Central Board of Direct Taxes (CBDT) now the new Income Tax Rule 2021 is going to be in effect from April 1. This change will make the interest income taxable if the PF contributions are made above the capped amount of Rs.2.5 lakh per annum.

COVID-19 Treatment Becomes Income Tax-Free

The person who has received money for the COVID treatment will get the tax exemption on that amount as per the press release in June 2021. Similarly, the amount received by the family on the death of a family member due to covid will be exempt upto Rs.10 Lakh, if they receive the money within 12 months of the date of the death.

Income Tax Benefit For Differently-Abled Person

The parent or guardian of a differently-abled person can purchase an insurance scheme for later, and the tax exemption will be applicable on gross income.