In the General Budget of 2018-19. Finance Minister Arun Jaitley has not made changes in the income tax slab and rates. But propose some changes, which will affect many taxpayers. In fact, the year 2018-19 Several changes have made since the long-term capital gains tax on shares and equity mutual fund. From the annual budget of the year to the relief of interest from senior citizens.
The finance minister has proposed a new standard deduction for salaried workers but simultaneously has increased. The rate of interest on income tax by one percentage point. Most of these changes will take place on April 1, 2018-19, Will be effective as soon as it starts.
10 key changes related to the proposed income tax in the General Budget 2018
Standard deduction of 40,000 Rs
The standard deduction of Rs 40,000 was made for the salaried class in the budget. The deduction proposes at the place of existing 19,200 transport allowance and Rs 15,000 crore medical rebarbative. This deduction will reduce the taxable income of the salaried class by 40,000 rupees. This will benefit about 2.5 crore employees. Also, pensioners, who usually do not get any allocation for transport and medical expansions, will also benefit from them. However, the advantage of this new rule will be according to the employee’s tax bracket.
Increase in cess
Finance Minister Arun Jaitley has increased the education cess. Which is levied on income tax, from the existing three percent to four percent … this cess is levied on the income tax payable by the taxpayer.
Long-term capital gains tax on equity investments
Equity Shares or Equity-Oriented Funds Sales from Units Now more than 10 percent tax (plus additional) charged. If the income is more than Rs. 1,00,000. However, the income of taxpayers till January 31, 2018, not counted. This means that As a result, the profit on prices after Jan 2018 counted as income.
Nonsalaris class can also get tax exemption on NPS clearance
Now, such NPS account holders who do not have salary clauses, if they close their accounts then they will not have to pay tax on 40% of the total funds. The convenience of the salary class account holders is already available in the tax exemption facility. This facility will also be available to account holders of nonsalary classes.
Income Tax Exemption on Single Premium Health Insurance Policy
If you pay continuous insurance premiums for a few years, then health insurance companies give some discounts. Earlier, thus insure could claim the tax deduction at the amount up to Rs 25,000. But in this budget, a single premium health insurance policy for more than a year proposes to tax deduction based on a proportion of the period of insurance.
For example, in the event of your insurer pay 40,000 rupees together for a two-year policy, you are giving a discount of 10 percent, and you pay it, if the new proposed rules now, Can get the tax deduction at a premium of Rs 20,000.
Senior Citizens Rs 50,000 Tax exemption on interest income up to
Now, senior citizens will be able to get tax exemption on the amount of interest earned on savings accounts and recurring deposit accounts (recurring deposits or RDs) opened in banks and post offices.
At present, on the income from savings accounts, each person can get the tax rebate on the interest of Rs. 10,000 under section 80 TTA of the Income. Tax Act, but now tax proposes to add Section 80 TTB under which the Senior Citizens will be able to get tax relief on the amount of interest up to Rs 50,000 from the interest income.
Although senior citizens not able to avail the exemption of 80 TTA exemptions. Besides this, the government has also increased the limit of investment. Under Prime Minister Vaidya Yojana (PMVVY) from 7.5 lakh to 15 lakh rupees. This scheme also proposes to extend the extension by March 2020. The Prime Minister Vandana Yojana (PMVVY) introduce senior citizens is give an eight percent interest assure.
Tax on dividend of equity mutual fund
Tax on income dividend income from equity mutual funds Dividend by equity-oriented mutual funds will be taxed at the rate of 10 percent.
Section 80D deduction limit increased for senior citizens
In 2018, the government also proposes to increase tax deduction on the payment of health insurance premium for Senior Citizens. Senior Citizens now not require paying income tax on the payment of 50,000 rupees as a health insurance premium in one year from 1 April. Earlier this limit was 30,000 rupees. However, under Section 80D for people under age 60, the limit will still be 25,000 rupees. This limit has been increased to Rs. 50,000 for those above 60 years.
Increased Tax Exemption Limit for Senior Citizens on Treatment of Diseases
The amount of Rs.1,00,000 of the expenditure incurred for the treatment of selected diseases now deducted from taxable income, whereas till now, over-senior citizens (more than 80 years) get 80,000 rupees and senior citizens (more than 60 years) A discount of Rs 60,000 was given in this item.
TDS limit for senior citizens increased
It proposed to increase the limit of tax deducted at source (TDS) from an interest of Rs 10,000 to Rs 50,000 on the interest income from senior citizens.