Following are some messages received on Whatsapp highlighting key points of budget proposals announced today by Finance Minister for FY 2020-21. These are subject to further verification and confirmation from actual copy of budget proposals and after it is approved by Parliament.
Pensioners who were expecting great relief through this budget stands disappointed . No relief has been proposed for senior citizens in addition to what already exists .Individuals earning more than Rs.10 lakhs and more may get some relief if he or she opts new set of rules and is ready to surrender exemptions. Persons in range upto Rs.10 lakh will have to weigh which option is beneficial from Income Tax point of view.
If individual ears income of 15 lakhs then tax would be 1.95 lakh vis-a-vis 2.73 lakhs as earlier.
New scheme of individual tax rates is optional
FM says - reviewed all existing income tax exemptions and removed 70 of them in new regime and will review remaining and rationalize
The individual or HUF opting for taxation under the newly inserted section115BAC of the Act shall not be entitled to
the following exemptions/ deductions:
(i) Leave travel concession as contained in clause (5) of section 10;
(ii) House rent allowance as contained in clause (13A) of section 10;
(iii) Some of the allowance as contained in clause (14) of section 10;
(iv) Allowances to MPs/MLAs as contained in clause (17) of section 10;
(v) Allowance for income of minor as contained in clause (32) of section 10;
(vi) Exemption for SEZ unit contained in section 10AA;
(vii) Standard deduction, deduction for entertainment allowance and employment/professional tax as contained in
section 16;
(viii) Interest under section 24 in respect of self-occupied or vacant property referred to in sub-section (2) of section 23.
(Loss under the head income from house property for rented house shall not be allowed to be set off under any
other head and would be allowed to be carried forward as per extant law);
(ix) Additional deprecation under clause (iia) of sub-section (1) of section 32;
(x) Deductions under section 32AD, 33AB, 33ABA;
(xi) Various deduction for donation for or expenditure on scientific research contained in sub-clause (ii) or sub-clause
(iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of section 35;
(xii) Deduction under section 35AD or section 35CCC;
(xiii) Deduction from family pension under clause (iia) of section 57;
(xiv) Any deduction under chapter VIA (like section 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA,
80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, etc). However, deduction under sub-section
(2) of section 80CCD (employer contribution on account of employee in notified pension scheme) and section 80JJAA
(for new employment) can be claimed.
Pensioners who were expecting great relief through this budget stands disappointed . No relief has been proposed for senior citizens in addition to what already exists .Individuals earning more than Rs.10 lakhs and more may get some relief if he or she opts new set of rules and is ready to surrender exemptions. Persons in range upto Rs.10 lakh will have to weigh which option is beneficial from Income Tax point of view.
If individual ears income of 15 lakhs then tax would be 1.95 lakh vis-a-vis 2.73 lakhs as earlier.
New scheme of individual tax rates is optional
FM says - reviewed all existing income tax exemptions and removed 70 of them in new regime and will review remaining and rationalize
The individual or HUF opting for taxation under the newly inserted section115BAC of the Act shall not be entitled to
the following exemptions/ deductions:
(i) Leave travel concession as contained in clause (5) of section 10;
(ii) House rent allowance as contained in clause (13A) of section 10;
(iii) Some of the allowance as contained in clause (14) of section 10;
(iv) Allowances to MPs/MLAs as contained in clause (17) of section 10;
(v) Allowance for income of minor as contained in clause (32) of section 10;
(vi) Exemption for SEZ unit contained in section 10AA;
(vii) Standard deduction, deduction for entertainment allowance and employment/professional tax as contained in
section 16;
(viii) Interest under section 24 in respect of self-occupied or vacant property referred to in sub-section (2) of section 23.
(Loss under the head income from house property for rented house shall not be allowed to be set off under any
other head and would be allowed to be carried forward as per extant law);
(ix) Additional deprecation under clause (iia) of sub-section (1) of section 32;
(x) Deductions under section 32AD, 33AB, 33ABA;
(xi) Various deduction for donation for or expenditure on scientific research contained in sub-clause (ii) or sub-clause
(iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of section 35;
(xii) Deduction under section 35AD or section 35CCC;
(xiii) Deduction from family pension under clause (iia) of section 57;
(xiv) Any deduction under chapter VIA (like section 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA,
80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, etc). However, deduction under sub-section
(2) of section 80CCD (employer contribution on account of employee in notified pension scheme) and section 80JJAA
(for new employment) can be claimed.
List of deductions excluded from New Tax Regime (Section 115BAC)
(i) Leave travel concession as contained in clause (5) of section 10 (ii) House rent allowance as contained in clause (13A) of section 10;
(iii) Some of the allowance as contained in clause (14) of section 10;(iv) Allowances to MPs/MLAs as contained in clause (17) of section 10;(v) Allowance for income of minor as contained in clause (32) of section 10;(vi) Exemption for SEZ unit contained in section 10AA;
(vii) Standard deduction, deduction for entertainment allowance and employment/professional tax as contained in
section 16;
(viii) Interest under section 24 in respect of self-occupied or vacant property referred to in sub-section (2) of section 23.
(Loss under the head income from house property for rented house shall not be allowed to be set off under any
other head and would be allowed to be carried forward as per extant law);
(ix) Additional deprecation under clause (iia) of sub-section (1) of section 32;
(x) Deductions under section 32AD, 33AB, 33ABA;
(xi) Various deduction for donation for or expenditure on scientific research contained in sub-clause (ii) or sub-clause
(iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of section 35;
(xii) Deduction under section 35AD or section 35CCC;
(xiii) Deduction from family pension under clause (iia) of section 57;
(xiv) Any deduction under chapter VIA (like section 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA,
80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, etc).
However, deduction under
sub-section (2) of section 80CCD (employer contribution on account of the employee in notified pension scheme) and
section 80JJAA (for new employment) can be claimed.
Highlights of Union Budget 2020
This is the Budget for increasing the Income & Purchasing power of Indians
Fiscal Deficit seen at 3.8% vs 3.3% target 2019-20. Target seen at 3.5%
GDP seen at 10% nominal Growth as compare to current year. It might be in the range of 5% to 5.5% some where
Govt will raise the funds through LIC stake sale via IPO
Expenditure estimated at Rs.26.99 lakh crores. Total Expenditure at Rs.30.42 lakh crs
Receipts estimated at Rs.19. lakh crs
Net Market Borrowing target Rs.4.99 lakh crores
60 lac new Tax Payers added via GST introduction
Committed to Doubling farmers income by 2022
6.11 Cr farmers insured under "PM FASAL BIMA YOJANA"
Rs.2.83 lakh crs allocated for agriculture and irrigation
Agri credit target at Rs.15 lakh crs
Rs.1.23 lakh crs allocated for Rural Development
Rs.12300 crs allocated for Swach Bharat Mission
Rs.3.6 lakh crs allocated for Jal Jivan Mission
Rs.69000 crs allocated for Health Sector
Rs.99300 crs allocated for Education sector. Rs.3000 crs to be for Skilled Segment
Rs.6000 crs allocated for BharatNet Program. Approx 1 lac Gram Panchayat will be linked under BharatNet
Rs.27300 crs for development of Industry & commerce
Rs.35600 crs allocated for Nutrition related plans
Rs.1480 crs allocated for Textile Mission
Expand Gas Grid to 27000 kms
Rs.18600 crs Bengaluru Suburban Transportation Project
100 more Airport till 2024 under Udaan Project
Rs.1.7 lakh crs allocated for Transportation
Rs.22000 crs allocated for Power and Renewable Sector
Rs.85000 crs for Schedule Caste & OBC
Rs.53700 crs allocated for Schedule Tribs
Rs.3100 crs allocated for Ministry of Culture
Rs.2500 crs allocated for Tourism Promotion
Rs.28600 crs allocated Women centric programs
Rs.9500 crs allocated for Sr. Citizen and Handicapped
Rs.4400 crs allocated for clean Air
Deposit Insurance coverage increases to 5 lakh from 1 lakh
Rs.22000 crs for National Infra Pipeline
Direct Tax
Changes in Income Tax slabs
- if having income 5 lakh then no Tax is applicable
Income More then 5 lakh has following rates
- 0 to 2.5 lakh - Nil
- 2.5 lakh above to 5 lakh - 5%
- 5 lakh above to 7.5 lakh - 10%
- 7.5 lakh above to 10 lakh - 15%
- 10 lakh above to 12.5 lakh - 20%
- 12.5 lakh above to 15 lakh -25%
- above 15 lakh - 30%
Dividend Distribution Tax
- Abolish of DDT. Company will not pay tax on the dividend declared only receipient has to pay the same
FPI investments in Infra Bonds (Sovereign Wealth Funds) with 3yrs lock no Tax on Dividend and capital Gains investments upto 31st March 2024
Audit limit of Businesses increased from 1 cr to 5 crs
___________________________________________________
Income Tax
Between ₹5 lakh and ₹7.5 lakh Reduced to 10% from the current 20%
Between ₹7.5 lakh to ₹10 lakh Reduced to 15% from the current 20%
Between ₹10 lakh to ₹12.5 lakh Reduced to 20% from the current 30%
Between ₹12.5 lakh to ₹15 lakh Reduced to 25% from the current 30%
Above ₹15 lakh Continue at 30%, but without exemptions
Over 70 deductions have been removed.
* Disinvestment Targeted at Rs. 2.1lakh crs
- 80C limit no changes it is upto 1.5 lakh only.
* Approx 70 items removed out of 100 for Tax exemption
No Changes in LTCG
ReplyDeleteThanks for providing useful, knowlegeable and informative blog.
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