Highlights of Union Budget 2024-25

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Stay updated with the latest changes and proposals in the tax landscape from the Union Budget 2024-25. Our goal is to bring you the most relevant and beneficial information to help you navigate the tax season smoothly.

Highlights of Union Budget 2024-25

Revised Tax Slab Rates

For the New Tax Regime under Section 115BAC:

• Up to ₹3,00,000: Nil
• ₹3,00,000 – ₹7,00,000: 5%
• ₹7,00,000 – ₹10,00,000: 10%
• ₹10,00,000 – ₹12,00,000: 15%
• ₹12,00,000 – ₹15,00,000: 20%
• Above ₹15,00,000: 30%

 

Key Direct Tax Proposals

• Employer Contribution to Pension Scheme: Increased from 10% to 14%.
• Family Pension Deduction: Raised from ₹15,000 to ₹25,000.
• Standard Deduction for Salaried Employees: Increased from ₹50,000 to ₹75,000.
• Rental Income Taxation: Income from renting residential houses to be taxed as House Property.
• Settlement Payments: Amounts paid to settle legal proceedings now considered non-deductible expenses.
• Share Buyback Taxation: Amount distributed on share buybacks will be taxed as dividends.
• Angel Tax Abolished: The tax on the issue of shares at a premium has been abolished.

 

Capital Gains Taxation

Holding Period Adjustments

For Listed Securities:

• • Equity Shares: Remains at 12 months
  • Units of Business Trust: Reduced from 36 months to 12 months
  • Other Units: Reduced from 36 months to 12 months
  • Debentures/Bonds: Remains at 12 months
  • Government Securities: Remains at 12 months

For Unlisted Securities:

• • Equity Shares: Reduced from 24 months to 12 months
  • Units of Business Trust: Reduced from 36 months to 24 months
  • Other Units: Reduced from 36 months to 24 months
  • Debentures/Bonds: Reduced from 36 months to 24 months
  • Government Securities: Reduced from 36 months to 24 months

For Other Assets:

• • Physical Gold: Reduced from 36 months to 24 months
  • Immovable Property (Land and Building): Remains at 24 months
  • Any Other Assets: Reduced from 36 months to 24 months

 

Revised Tax Rates for Capital Gains

Short-Term Capital Gains (STCG):

• • Listed Stocks/Mutual Funds: Increased from 15% to 20%
  • Listed Bonds: At slab rate
  • Other Capital Assets: At slab rate

Long-Term Capital Gains (LTCG):

• • Listed Stocks/Mutual Funds: Increased from 10% to 12.5%
  • Listed Bonds: Remains at 20%
  • Other Capital Assets: Remains at slab rate

Note: The benefit of indexation has been removed. Exemption limit increased from ₹1,00,000 to ₹1,25,000 under Section 112A.

 

TDS/TCS Provisions

• Salary/Remuneration to Partners: TDS @ 10% for amounts exceeding ₹20,000.
• EPF Withdrawal for Non-PAN Holders: TDS reduced to 20%.
• Luxury Goods Sale: TCS @ 1% for sales above ₹10,00,000.
• Reassessment Time Limit: Reduced from 10 years to 5 years for income escaping assessment of ₹50,00,000 or more.

 

Goods and Services Tax (GST) Updates

• Refunds: Unutilized ITC or IGST on zero-rated supplies subject to export duty will not be disallowed.
• ITC Eligibility: Invoices from FY 2017-18 to FY 2020-21 are eligible if claimed by November 30, 2021.
• Waiver of Interest and Penalty: Conditional waiver for demands under Section 73 for FYs 2017-18 to 2019-20.
• Representation by Authorized Person: Individuals can send authorized representatives to appear before GST authorities.

 

Customs Updates

• Custom Duty Rates: Reduced for items like PVC flex films, garden umbrellas, and laboratory chemicals.
• Self-Certification for Proof of Origin: Accepted for imported goods.
• Advance Rulings: Expanded to include “other persons” besides importers and exporters.

 

Stay Informed and Compliant

Understanding these updates can significantly impact your financial planning and tax compliance. For further information or personalized advice, feel free to reach out to our team of experts.

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