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MAJOR AMENDMENTS IN INCOME TAX APPLICABLE FOR A.Y. 2018-19😊1. Limit for payment of expenses by cash (Both capital and revenue expenditure) reduced from RS. 20, 000 to RS. 10, 000 per day in aggregate per person.2. No Person shall receive an amount of two lakh rupees or more, by cash (Sec 269ST).3. For below Rs. 2 crores turnover cases - For Non cash sales (through Digital, Online, cheque, Bank etc.) : Net Profit will be taken as 6% of Turnover/ Gross Receipt. It is 8% For Cash Sales.4. Tax Exemption limit is Rs.2, 50, 000/- (same as earlier) After that, up to 5 Lakh, Tax rate is 5% (earlier it was 10%).5. Tax rebate is reduced to Rs.2500 from Rs.5000 per year for taxpayers with income up to Rs.3, 50, 000 (earlier Rs.5, 00, 000).6. Surcharge at 10 percent of tax levied on rich taxpayers with income between Rs.50 Lakh and Rs.1 Crore. The rate for surcharge for the super-rich, with income above Rs.1 Crore will remain 15%.7. Payment of Rent - Rs.50, 000 per month by any Individual or HUF (not subject to Tax Audit requirement) - Deduct TDS @ 5%.8. Capital gain in respect of Land and Building period reduced from 3 Years to 2 Years and Base year shifted from 01/04/1981 to 01/04/2001.9. Corporate tax rate for the account year 2017-18 for companies with annual turnover up to Rs.50 crores (in account year 2015-16) is reduced to 25%. No change in firm tax rate of 30%.10. Donation made exceeding Rs.2000 will be not be eligible for deduction under section 80G.11. Shares of unquoted shares to be taxed at (deemed) fair value.12. Tax exemption will be available on reinvestment of capital gains in notified redeemable bonds (In addition to investment in NHAI and REC bonds).13. Deduction for first time investors in listed equity shares or listed units of equity oriented funds under the Rajiv Gandhi Equity Savings Scheme under section 80CCG of IT act 1961 is withdrawn from FY 2017-18. If an individual has already claimed deduction under this scheme before April 1, 2017, They shall be allowed to avail a deduction for the next two years.14. No tax is applicable for partial withdrawals from National Pension System. NPS subscribers will be able to withdraw 25% of their contribution to the corpus for emergencies before retirement. Withdrawal of 40% of the corpus is tax free before retirement.15. In absence of PAN of the buyer of specified goods, the rate of TCS will be twice of the extent rate or 5%, whichever is higher.16. From Financial Year 2017-18, if Return is not filed within due date, late fee of Rs.5, 000 for delay up to 31st December, and Rs.10, 000 thereafter. Such fee will be restricted to Rs.1, 000 for small taxpayers with income up to Rs.5 lakh.17. A simple one page tax return form is to be introduced for Individual with taxable income up to Rs. 5 lakh (excluding Business Income). Those filing returns for the first time in this category will generally not be subject to scrutiny.18. Time period for revision of tax return cut to one year (from 2 years) from the end of relevant financial year or before completion of assessment, whichever is earlier.19. Where Section 12AA registered trusts modify their object clause, they need to apply within 30 Days to CIT for approval.20. It is mandatory to disclose the Aadhar number while filing IT Return. Earlier it was optional to disclose Aadhar number. Generally the last date of filing IT return is 31 July. Therefore, it is advisable for taxpayer to get their Aadhar number at the earliest
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TDS @ 2% is required to be deducted on payment made to the supplier of taxable goods orservices of both where the value of such supply under a contract exceeds Rs. 2.5 Lakhs. Thus, theindividual supplies may be less than 2.5 Lakhs but if the contract value is more than Rs. 2.5 Lakhs– TDS @ 2% would be required to be deducted.For the purpose of the computation of the contract value, the following shall be excluded1. Central GST2. State GST3. Union Territory GST4. Integrated GST5. CessIt is important to note that these provisions have not yet been implemented and would beimplemented in future from date as notified by the Govt. The date for implementation of provisionsof GST has not yet been announced by the Govt.For example: Suppose a supplier makes a intra-supply i.e. supply within the same state worth Rs.10, 00, 000 to a recipient and CGST @ 9% and SGST @9% is required to be paid. The recipientwhile making the payment of Rs. 1, 000 to the supplier shall deduct 1% TDS under the CGST Actand 1% TDS under the SGST Act and therefore the total TDS Deducted would be 2% which in theabove case would be Rs. 20, 000.In case the above supplier makes an inter-state supply, TDS @2% i.e Rs. 20 would be required tobe deducted and deducted with the Govt.The value for the purpose of computing the amount of TDS shall not include 18% GST.The purpose of introduction of TDS on GST is only to enable the govt to have a trail oftransactions and to monitor and verify the complianceWho is required to deduct TDS on GSTAs per Notification No. 33/2017 Central Tax dated 15th Sept 2017, the following class of personsare required to deduct TDS on GST if the Contract Value is more than Rs. 2.5 Lakhs:-1. An authority or board or any other body with 51% or more participation by way of equity orcontrola. Set up by an Act of Parliament or a State Legislature; orb. Established by any Govt., 2. Society established by the Central Govt. or State Govt. or a Local Authority under the SocietyRegulations Act, 18603. Public Sector Undertakings
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