Income Tax Rules Changing From April 1: 7 Biggest Changes Every Business Should Know

Taxpayers must heed the following updates as announced in this year’s Union Budget

As the financial year draws to a close today, so does the deadline for completing important tax related activities.

There are some changes to the present income tax rules that one needs to be aware of.

1) PAN- Aadhaar Linking 

As earlier reported, the PAN and Aadhaar card have to be linked or else the PAN card would be considered inoperative come Apr 1, 2021. 

One would also incur a penalty of Rs 1,000 due to failure of furnishing the PAN card under Section 272B of the Income Tax Act.

2) Revised ITR Filing

Mar 31 or today is the last date by which-

  • One can appeal in case of errors in ITR
  • One can file revised tax return
  • One can file a delayed ITR if it is not yet filed

Anything done after today will risk a penalty of Rs 10,000 as late fee. But if your income falls in the Rs 5 lakh bracket, there is some relief as you will have to be just Rs 1,000.

3) LTC Cash Voucher Scheme Bill Submission

The government has provided relief in form of tax exemption for those who could not claim their LTC tax benefit due to the pandemic.

Today is the last day of this scheme.

4) Pre-Filled ITR Forms

Details of salary income, tax payments, TDS, etc. will now be automatically filled out in what is known as “pre filled” ITR forms. This is to ensure a smooth process for the taxpayer to comply with the return filing process.

The prefilled details are sourced externally which is then auto-populated in the forms.

5) Senior Citizens Above 75 Years Exempted From Filing ITR

To ease the burden on senior citizens above 75 years of age, the government has decided to exempt them from filing ITR themselves. 

This is applicable to only those whose main sources of income are pension and interest levied on the same.

On behalf of the taxpayer their bank will do the tax deductions for them, thereby scrapping the need for the person to file an ITR.

6) Salary Details Submission Of Previous Employer

For those who changed jobs in the present fiscal year, salary slips from the previous employer will have to be furnished to the present one. 

This is to ensure that the current employer deducts tax properly.

Today is the deadline for the same.

7) Option to choose ‘New Tax Regime’ instead of Old Tax Regime

Form 10-IE is the form that needs to be filled if one is opting for a new tax regime. 

Upon failure to fill the form the taxpayer will be liable to pay tax, the rates of which align with the old or existing tax regime.

The option to opt in to the new regime will be available when filing ITR for FY 2020-21.

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