Though the government refrained from announcing any major populist measure, the finance minister provided some relief to individuals as well as startups
Read More:- Indian government will borrow less money from the market next year — that’s good for PSU banks
Finance Minister Nirmala Sitharaman has presented her sixth Union Budget in a row. In this pre-election Budget, though the government refrained from announcing any major populist measure, the finance minister provided some relief to individuals on personal taxation as well as startups. Here are the personal taxation announcements in the Interim Budget 2024-25:
No Changes in Personal Tax Rates
Suresh Surana, founder of RSM India, said, “In line with the past parliamentary practice, the interim budget does not propose any major structural change in the tax rates and continues the same as per last year. Under the new regime, a person having gross income up to Rs 7 lakh shall have NIL tax liability.”
Health & education cess @ 4 per cent is levied on aggregate of tax amount and surcharge amount.
A rebate of Rs 12,500 is available in the case of the old tax regime for a total income up to Rs 5,00,000 and of Rs 25,000 in the case of the new tax regime up to a total income of Rs 7,00,000. Marginal tax relief is available in the case of the new tax regime for income exceeding Rs 7,00,000.
Surcharge on capital gains and dividend taxation unchanged at 15 per cent.
Waiver of Old Trivial Tax Demands
“In the Interim Budget 2024, the Proposal of waiver of old unreconciled trivial tax outstanding is in line with the Government’s vision to improve ease of living and ease of doing business. There are a large number of petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing undue hardship, administrative difficulties and hindering refunds of subsequent years,” Surana said.
Read More:- Budget 2024: Nirmala Sitharaman Gives Her Shortest Speech at 58 Minutes; No Change in Income Tax Slab
The proposal is to withdraw such outstanding direct tax demands up to Rs. 25,000 pertaining to the period up to financial year 2009-10 and up to Rs. 10,000 for financial years 2010-11 to 2014-15. No specific mention has been made about whether this tax proposal would be applicable for individual or corporate taxpayers. it is expected to overall benefit about 1 crore taxpayers and is extremely welcome. There are no specific proposals in the Finance Bill 2024 in this respect and it is likely that a separate circular will be issued by the CBDT to provide the aforesaid relief.
No Changes in Basic Exemption Limit
“As per the current tax laws, the Basic Exemption Limit (BEL) under old tax regime is Rs 2,50,000, which has remained the same since its last revision in Budget 2014. Even under the new tax regime, the basic exemption limit is Rs 3,00,000,” Surana said.
Considering that the cost of living has increased multi-fold times in the past decade, it was expected that the said basic exemption limit be increased to Rs 3,50,000 under both regimes. Enhancing the said basic exemption limit may benefit a large number of taxpayers and tax filers out of the about 7 crore taxpayers, he added.
Due Date Extension for Filing Belated Tax Return to End of Assessment Year
The existing due date for filing a belated return is December 31 of the relevant assessment year. For instance, the belated return for the financial year 2023-24 can be filed by December 31, 2023. Such filing of a belated return would attract late fees of Rs 5,000 (restricted to Rs 1,000 wherein the total income of the taxpayer does not exceed Rs 5 lakh).
“There are a large number of tax filers who miss the deadline of the belated return due to personal exigencies, delay in getting or collating data. It was expected that belated returns should be permitted up to March 31 but can require a higher fee of Rs 10,000. This would have ensured that while the tax filer is penalised, he does not become a delinquent tax filer,” Suresh Surana said.
Read More:- Budget 2024: FM Announces Withdrawal Of Direct Tax Demand Below Rs 25,000, Check Details Here
“We can still hope that the increase in basic exemption limit and the belated return-related relaxations will be introduced in the Final Budget,” Surana said.
