Budget 2021 Personal Finance: Union Finance Minister Nirmala Sitharaman has presented the budget for the financial year 2021-22. This is the third budget of the second term of the Modi government. This budget has become very important due to Corona epidemic and subsequent economic crisis. This budget will also have a big impact on your personal finance. Somewhere you can get benefit, then somewhere you can also get loss.
Senior citizens will not have to file ITR
It was announced in the budget that such elderly people above 75 years who depend only on pension and interest income from deposits, will not need Income Tax Return Filing (ITR). The paying bank will deduct the required tax on their income. However, for this benefit it is necessary that pension and interest income come to the same bank. At the same time, senior citizens who have other sources of income besides pension and interest income from bank deposits, will have to file income tax returns.
Tax on pf
Nirmala Sitharaman, in her budget speech, proposed that the tax exemption in respect of interest income on employee contributions to various PFs should be limited to Rs 2.5 lakhs per annum. This new proposal will be applicable to PF contributions to be held on or after 1 April 2021. After the implementation of this proposal, only interest income from contribution up to Rs 2.5 lakh per annum in PF will be tax free. Interest income on contribution over this limit will be taxed. This will directly affect the employees, whose income is high and they get huge tax free interest income through Voluntary Provident Fund.
Budget 2021 Live News Updates: Every update related to the budget
Tax on ulip
Tax exemption available under section 10 (10D) has been removed if you pay a premium of more than Rs 2.5 lakh in a year in unit linked insurance policies (ULIPs). This rule will not apply to existing ULIPs. This will be effective only on policies sold after February 1 this year. Capital gains on these will be taxed in the same way as equity oriented mutual funds are taxed. That is, these will be taxed at 10 percent.
Deposit insurance cover increased from 1 lakh to 5 lakh rupees
Finance Minister Sitharaman said in the budget speech that the government had approved to increase the deposit insurance cover for bank customers from 1 lakh to 5 lakh. She said that she will introduce amendments to the DICGC Act, 1961 only in this session, so that if a bank is temporarily unable to fulfill its obligations, depositors of such bank can easily and timely deposit their deposit deposit insurance cover To the extent of He said that this would help depositors of banks in crisis.
Promotion of faceless assessment
Finance Minister Sitharaman said in the budget speech that he is committed to make the taxation process faceless for easy compliance. The government has already introduced faceless assessment and appeal this year. He said that the next level of income tax appeal is the Income Tax Appellate Tribunal. She now proposes to make this tribunal faceless. A National Faceless Income Tax Appellate Tribunal Center will be set up. All communication between the tribunal and the applicant will be electronic.
High Speed Tax Solutions
Finance Minister Sitharaman said that at present, it can take up to 6 years to reopen an assessment and in serious case it can go up to 10-7. In such a situation, taxpayers have to remain indefinite for a long time. He has proposed to reduce the time limit for re-opening the assessment from the present 6 years to 3 years.
Reduction on home loan interest increased
The Finance Minister announced that it is proposed to extend the tax deduction by another year up to Rs 1.5 lakh on the interest payment of home loans for the purchase of cheap houses. That is, taxpayers can now take advantage of this additional deduction on the home loan taken till 31 March 2022.
Union Budget 2021: Up to 10.50 Lakh Income From Home Loan Only Tax Free! This is a complete calculation
Tax Benefit Zero Coupon Bond
Sitharaman said in the budget that to ensure that a large number of funds invest in India, they are offering relief in private funding restrictions, commercial work restrictions and some conditions related to direct investment in infrastructure. They said that they are approving funding of infrastructure by issuing zero coupon bonds. For this, they are proposing that they can raise funds by issuing notified infrastructure debt funds, tax efficient zero coupon bonds.
Workers will get social security
Employees working in e-commerce businesses like Uber, Ola Swiggy and Zomato do not get salary and do not get the benefit of social security schemes like provident fund, group insurance and pension. For these people, the Finance Minister has announced in the budget that the minimum salary for such personnel will be ensured and employees will be brought under the State Insurance Corporation.
In the budget speech, the Finance Minister said that taking steps towards protecting the investor, she proposes to introduce an investor charter. He informed that this charter will be the right of all financial investors in all financial products.