Interestingly, on the surface there are no major tax law changes from Indian Budget 2021, but many announcements as a whole to bring back the economy on it's wheels. Document covers Top 10 frequent questions from the perspective of a normal tax payer.
There are NO major changes in tax rates for FY 2021-22. The Tax rates which were proposed by Budget 2020 are applicable for FY 2021-22 also. Taxpayers can follow either old regime with deductions or the new tax slabs without deductions.
Know more about Difference between Old Tax Regime and New Tax Regime.
Know your Tax exposure using Income Tax Calculator for FY 2021-22
Senior Citizens over 75 years of age and having only Pension and Interest are exempted from Filing Income Tax returns from FY 2021-22. The required taxes will be deducted by the Banks at the time of payment. In case, if Senior Citizens have any other sources of Income such as Capital Gains, Foreign Income etc, then these are required to file IT Returns
Know more on Senior Citizens to be exempted from filing ITR
The Threshold limit for Tax Audit has been increased to Rs 10 Crores from Rs 5 Crores if at least 95% of the business receipts and payments are made through electronic modes.
Note: If more than 5% of business receipts and payments are made through cash, then the Tax Audit limits remains unchanged. The Business is required to get Tax Audit if the turnover is more than Rs 1 Crore.
|Sales Turnover||Tax Audit ?|
|Up to 1 Crore||Not required.|
|1 to 5 Crores||Not Required, if at least 95% of the business receipts made through electronic mode|
|5 to 10 Crores||Not Required, if at least 95% of the business receipts made through electronic mode|
|Above 10 Crores||Required.|
There are no such major changes in Deductions under Chapter VIA. Following are the deductions which are amended.
Finance Minister Nirmala Sitharaman, emphasized that no additional taxes to be levied but a proper enforcement should bring more tax revenues. In the same lines, few due dates were brough backward to bring seriousness to tax filing due dates.
Original return: There is no changes in Filing Original Income Tax Returns
Belated Returns: The Due date for Filing Belated return has been reduced by 3 months i.e., Belated returns can be filed till Dec 31 of respective Assessment year.
Revised Returns: The Due date for Filing Revised return has been reduced by 3 months i.e., Revised returns can be filed till Dec 31 of respective Assessment year
There are no such major changes in GST.
Finance Minister proposed to review more than 400 old exemptions under Customs Law. W.e.f Oct 2021, revised Custom tariff structure would be introduced.
The FM has announced some schemes for reducing disputes and simplifying Settlement.
There are no changes in Residency rules for NRI’s but there is a positivity from FM in removing hardships faced by NRI in Claiming DTAA benefits and Income accrued in Foreign Retirement accounts. Rules are yet to be notified by FM
The Budget 2021 has provided the ease of compliance in Corporate affairs
More emphasis on Infrastructure spending, raised customs duty to create jobs. No new changes to Taxes (Income Tax & GST)
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