The new tax rules will be introduced this week as the new fiscal year FY 2022-23 starts within the same week. According to reports, the personal taxation rules are also expected to change from this week, particularly from 1 April 2022.
Let's have a quick look at these rules and keep ourselves updated with any required taxation changes.
30% Taxes on Virtual Assets
Taxes of 30% will be levied on transactions that include virtual digital assets.
As per the speech by Finance minister Nirmala Sitharaman, "There has been a phenomenal increase in transactions in virtual digital assets. The magnitude and frequency of these transactions have made it imperative to provide for a specific tax regime.
"Accordingly, for the taxation of virtual digital assets, I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30 per cent."
Even if you receive cryptocurrency as a form of gifts, these digital assets will be taxable. Moreover, the losses incurred on the transfer of certain Virtual digital assets (VDA) cannot be written off against the income incurred on the transfer of other VDA.
Updated Filing of ITR Returns
A new provision allows people to file their updated tax returns if there were mistakes in the previously assessed returns. The updated ITR returns can be filed within 2 years from the year of assessment.
Taxes on PF
Finance Minister Nirmala Sitharaman proposed in her budget address for the FY 2022-23 that taxes will be levied on provident fund if the amount exceeds the Rs 2.5-lakh mark.
Taxes will be levied as per the guidelines laid down by the Central Board of Direct taxes.
NPS Deduction for State Government Employees
State government employees will now be able to claim a tax benefit of 14% on the National Pension System under Section 80CCD (2) which is made by their employer up to 14% of their basic salary and dearness allowance (DA). The deduction is similar to that of the central government employees under the same section.
Tax Relief on COVID-19 Treatment
People who receive money for COVID-19-related treatment will be exempted from the taxation on the treatment expenses. Similarly, tax will not be levied on the amount received for the death of a person due to COVID-19. No taxation on amount of up to Rs 10 Lakh if the money is received within 12 months of the date of death.
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