• Income tax rates have been reduced from 10% to 5% in case of individual tax payers in bracket of Rs. 2.50 Lakhs to Rs. 5.00 Lakhs.
  • Tax rebate is cut from Rs.5000/= to Rs.2500/= for individuals with taxable income up to Rs.3.5 Lakhs.
  • Individuals having net taxable income up to Rs.3.00 Lakhs need not to pay any tax.
  • 10% surcharge will be levied on income of Rs.50 Lakhs to Rs. One Crore and 15% if total income exceeds Rs. 1 crore. No change in surcharge for other assessees.
  • Deduction for contribution to NPS allowable to an individual (other than employee) up to 20% of his gross total income.
  • One page return form for those who have taxable income other than business or profession up to Rs.5Lakhs.
  • No tax scrutiny will be done for such first time return filers.
  • Delay in filing tax return for 2017-18 will attract penalty of Rs.5000/= if filed by Dec 31, 2018 and Rs.10000/= if filed later. Such fee will be restricted to Rs.1000/=for small tax payers with income up to Rs.5 Lakhs.
  • The limit of audit is increased form one crore to two crore for the business entities who opt for presumptive income scheme.
  • The limit of maintenance of books of accounts by individuals and HUFs is increased from turnover from 10 lakhs to 25 lakhs or income from 1.20 Lakhs to 2.50 Lakhs.
  • Advance tax can be paid in one installment by the professionals with receipts up to Rs.50 Lakhs under scheme for presumptive taxation.
  • Time period for revision of tax return cut to one year from two years from the end of the relevant financial year or before completion of assessment, whichever is earlier.
  • No TDS will be deducted from the payment made to commission agents and life insurance agents if their income is below taxable limit and they furnish the appropriate form to the deductor of the TDS.
  • Limit of cash donation to charitable trust is reduced from Rs.10000/= to Rs.2000/=
  • Limit for making cash payment of any revenue expenditure reduced to Rs.10000/=
  • Holding period of land and building is reduced to two years from three years for computation of long term capital gains.
  • Base for computing indexation benefit for long term capital gains shifted from first April’1981 to first April’2001.
  • Reinvestment of long term capital gains in notified redeemable bonds beyond NHAI, REC to qualify for long term capital gains tax exemption.
  • Professional, salaried employees and smaller businessmen, paying more than Rs.50000/= per month as rent will have to deduct tax at source at 5%.
  • In case of companies who have the turnover up to Rs.50 Crores, the tax rate is reduced to 25%.
  • Period for carry forward and use of MAT (Minimum Alternative Tax) is increased from 10 years to 15 years.
  • No cash transaction over Rs. 3 Lakhs.
  • With effect from 01.04.17, a trust registered under section 10(23C) can not make donations our of its income to any another trust registered under section 10(23C) or 12AA. Such donations, if made, would not be treated as application of funds of donor trust. Presently also, the donations out of the accumulated income are not treated as application out of such income.
  • If the trust registered under section 12A/12AA modifies its objectives subsequently, then trust would be required to obtain fresh registration by filing an application within 30 days of such adoption or modification of the objectives.
  • Trusts are required to file their income tax return if their receipts (before making any deduction or application) exceeds basic exemption limit i.e. Rs.250000/= for financial year 2017-18.
  • With effect from 01.04.2017, trusts would be allowed to avail the benefit under section 11 and 12 only if they file the income tax return before the due dates under section 139(1). Any delay in filing income tax return would disentitle them from the benefit under section 11 and 12.
  • With effect from 01.04.2017, the loss under ‘income from house property’ would be kept limited to Rs.2,00,000/= for adjustment against other income. However, the remaining portion of loss can be carried forward for next eight years and such loss can be set off against the ‘income from house property’ without any limit.

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