Don't Miss: Here's how your financial life will change from April 1



New Delhi, March 31: Get ready for some major changes in your taxes from April 1. Here are the key tax changes which will come into effect from April 1.

Several budget proposals including the reintroduction of the tax on long-term capital gains(LTCG) exceeding Rs 100,000 from the sale of shares will kick in from April 1, the beginning of the 2018-19 financial year.

Besides, other tax proposals like reduced corporate tax of 25 per cent on businesses on turnover of up to Rs 250 crore and a standard deduction of Rs 40,000 in lieu of transport allowance and medical reimbursement will come into effect from Sunday.



While the exemption limit on income from interest for senior citizens has been raised five times to Rs 50,000 per year, the limit of deduction for health insurance premium and medical expenditure has been raised to Rs 50,000 from Rs 30,000 under section 80D of the I-T Act.

For senior and very senior citizens, the tax deduction for critical illness will be Rs 100,000 from April 1, as against the existing limit of Rs 60,000 for senior citizens and Rs 80,000 for very senior citizens.

In the last regular Budget of the present NDA government, Finance Minister Arun Jaitley had retained the 10-15 per cent surcharge on the super-rich, while raising the health and education cess, levied on all taxable income, to 4 per cent from 3 per cent at present.

These proposals too will come into effect from Sunday.

The 2018-19 Budget had after a gap of 14 years reintroduced 10 per cent tax on LTCG exceeding Rs 1 lakh from sale of shares.

Currently, 15 per cent tax is levied on capital gains made on share sale within a year of purchase. However, it is nil for shares sold after a year of purchase.

However, indexation benefit for computing tax liability on the sale of shares listed after January 31 will be available, which will come as a relief to investors. In July 2004, the government had abolished LTCG tax on shares and replaced it with the securities transaction tax (STT) - a same-day tax credit system that continues.

Keeping the income tax rates and slabs unchanged, the Budget introduced a Rs 40,000 standard deduction for salaried employees and pensioners in lieu of the present exemption in respect of transport and medical expenses.

The standard deduction, which is provided to salary earners, was discontinued from the assessment year 2006-07. Presently, no tax is applicable on Rs 19,200 of transport allowance and medical expenditure of up to Rs 15,000. This has now been subsumed into the new standard deduction of Rs 40,000 which may mean very little benefit in tax saving considering that health and education cess has gone up.

With regard to corporate tax, the Budget has lowered the rate to 25 per cent for companies with the turnover of up to Rs 250 crore in 2016-17.

The changes will benefit the entire class of micro, small and medium enterprises which accounts for almost 99 per cent of companies filing their tax returns.

In 2015 Budget, Jaitley had promised to reduce corporate tax from current 30 per cent to 25 per cent over four years.

The Union Budget 2018-19 was the last full budget before the general elections next year, when a vote on account would be presented. The next full budget will be presented by the new government.

PTI

Related news

Don’t Miss

Sensex ends flat at 34,415.58; tech stocks RISE
18 Rohingyas arrested in Tripura for entering country illegally
BMW India launches third generation of SUV X3
Apple working on iPhone SE 2
Now you don't need a commercial licence for taxis and autos
Modi warns Pak from London,stop terror else face surgical strike..Rapes are worrisome, says PM
10 Points: Where has all the cash disappeared from ATMs
Hmm..Deepika walks hand-in-hand with ex Ranbir Kapoor
Pakistan calls India's claims on surgical strike 'baseless'
Chaiwala as PM has made Indians aspirational..Modi targets Gandhi family in London
LIVE: PM Modi and Prince Charles visit exhibition on 5000 Years of Science and Innovation
1993 Mumbai blasts death row convict Tahir Merchant dead
Can dogs predict earthquakes? Read here
Video: There's hope, Indians can see the truth, says Rahul Gandhi
Rape-accused Unnao MLA Kuldeep Singh's 'Y' category security withdrawn
10 Points: Naroda Patiya Massacre Case: All you wanted to know
Jio Magic.. Ambani among Fortune's 50 Greatest Leaders of 2018
BJP protecting rapists, am feeling insecure..Actress quits BJP
Rishi says this cute thing about Big B
From London Modi salutes Army for surgical strike..Pak understands only this language
Eye on Karnataka, PM Modi salutes Lingayat philospher in London
After pat on cheek of journo sparks outrage, TN Governor apologises
"Did I kill 8 members of my family," questions a weeping victim
Yogi's Facebook page is most popular among all chief ministers'
Wedding anniversary special: Never seen before pics of Abhishek-Aishwarya
Deepika Padukone in Time 100 Influential People of 2018 list
'Biggest tragedy is that to settle political scores, even judiciary is scandalised'
Jammu High Court Bar Association clarifies to SC on Kathua Case
Your cash shortage problem will be resolved by tomorrow
Mecca Masjid blast verdict judge Ravinder Reddy asked to attend court again

Most Recent




Most Popular