The financial year ends on March 31, this means the new financial year 2022-23 is going to start from April 1. Every year many big financial changes come into effect on this day which affects the pocket of Indian citizens. Some of the proposed things for the budget of 2022 are included in these changes. In this context, let’s have a look at the changes.
- Tax on virtual assets:
With the new financial year from April 1, new tax rules on cryptocurrencies will be implemented. From April 1, you will have to pay heavy tax on profits earned on cryptocurrencies. From April 1, returns received on crypto will be taxed at 30 percent, irrespective of the tax slab you fall in. Along with this, one percent of TDS will also be deducted from the transaction of cryptocurrencies.
- A separate account for EPF interest:
In the budget for the financial year 2021-22, it was announced to levy tax on the interest received on the contribution of more than Rs 2.5 lakh in the PF account of the employees. For this, the accounts of employees contributing more than Rs 2.5 lakh annually from the new financial year starting April 1, 2022, will be divided into two parts. One account will have the exempted part, while the other account will have the taxable part above Rs 2.5 lakh. According to the Central Board of Direct Taxes (CBDT), a new EPF account will be opened if the employee’s contribution to EPF exceeds Rs 2.5 lakh in the financial year 2021-22. An amount exceeding Rs 2.5 lakh will attract tax.
- Additional chance to update ITR:
From April 1, taxpayers will get an additional opportunity to update their ITR. For this, a new section 139(8A) has been added to the Income Tax Act. Updated returns can be filed within three years after the end of the financial year. At the time of filing the updated ITR, the taxpayer will have to pay an additional tax of 25 to 50 percent as tax and interest due. This updated return will be filed in case additional information was not provided at the time of filing ITR.
- Removal of additional tax exemption on house purchase:
Under Section 80EEA of Income Tax 1961, the government is giving the benefit of additional tax exemption to the taxpayers for buying cheap houses. The benefit of this concession is only available till 31 March 2022. After this, from 1st April 2022, you will not be able to take advantage of this exemption because the government has not extended this additional tax exemption for FY 2022-2023. This discount was available on houses costing less than Rs 45 lakh.
- Tax relief to differently-abled child parents:
Tax relief for the differently-abled was announced in the budget. Tax concessions have been given to the parents or guardians of the disabled person. A parent or guardian of a disabled person can take an insurance plan for such a person. The present law provides for a deduction to the parent or guardian only if there is a lump-sum payment or annuity facility available to the disabled person on the death of the subscriber i.e. the parent or guardian. Now no tax will be charged on annual or lump-sum payments for disabled dependents and they will be exempted for life.
- Change in TDS on sale of immovable property
The government has changed the provisions of TDS on the sale of immovable property with effect from April 1, 2022. Under this, one percent TDS will be applicable on the sale price or stamp duty, whichever is higher, on sale of non-agricultural immovable property valued above Rs 50 lakh. At present, this deduction is made only based on the value of the immovable property and does not take into account the stamp duty.
- Changes in Input Tax Credit:
Many times people surrender their GST Registration within six months. The credibility of the newly registered dealers will be tested thoroughly now. This may lead to some delays in getting an input tax credit to newly registered traders. Besides, if a business is declared a defaulter in filing returns or there is continuous delay in filing quarterly and monthly returns, then the trader who buys goods from him will also not get input tax credit. Similarly, from April 1, electronic invoicing will be mandatory for businesses with a turnover of more than Rs 20 crore.
- New bank rules:
Some banks are also changing the rules from April 1. Axis Bank is increasing the minimum balance for savings account from Rs 10,000 to Rs 12,000. Also, the free withdrawal limit will be increased to four times or Rs 1.5 lakh. On the other hand, PNB will introduce positive pay system. Under this, verification will be mandatory for cheques of an amount of Rs 10 lakh or exceeding it.