The Indian government regularly updates its tax regulations to keep pace with economic changes and promote compliance. These adjustments can significantly impact your tax returns, deductions, and potential refunds, making it crucial to stay informed. Vikas Dahiya, Director of ALL India ITR, emphasizes that even seemingly minor changes can have a substantial impact on your tax calculations.
Here are some key changes you need to be aware of for filing your ITR in 2024:
Changes in Tax Slabs and Rates:
The government has introduced new tax slabs this year under the optional new tax regime, which offers lower tax rates but eliminates exemptions and deductions. The previous system with exemptions and deductions remains available. It’s essential to compare both regimes to determine which best suits your financial situation.
Standard Deduction for Pensioners:
Pensioners now benefit from a new standard deduction of Rs 50,000, covering their pension income and offering similar support to salaried individuals. Retirees should claim this deduction to reduce their taxable income.
Changes in Section 80C and 80D Limits:
The maximum investment limit under Section 80C for PPF, NSC, and life insurance premiums remains at Rs 1.5 lakh. However, the government has increased the Section 80D medical insurance cap to promote digital payments and savings in the healthcare sector. You can now claim higher tax deductions for health insurance premiums paid for yourself, your family, and elderly parents.
Updated TDS and TCS Provisions:
The scope of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) has been expanded. Notable changes include new TDS rates for non-salaried individuals and professionals, along with additional compliance requirements for e-commerce transactions. Review your TDS certificates carefully and ensure you claim appropriate credits in your ITR.
Higher Deduction for Home Loan Interest:
The additional deduction of Rs 1.5 lakh under Section 80EEA for home loan interest has been extended for first-time homebuyers. This measure aims to promote home ownership and provides significant relief to taxpayers with new home loans.
Faceless Assessment and Appeals:
The government has expanded the channels for faceless assessments and appeals to reduce human interaction and promote transparency. Familiarize yourself with these processes and ensure you complete all online submissions and notice responses within the designated timeframes.
Enhanced Reporting Requirements:
Updated ITR forms now require more disclosures, particularly regarding overseas income, assets, and large transactions. Taxpayers with significant financial operations or investments abroad must submit comprehensive information to avoid penalties.
Relief for Senior Citizens:
Senior citizens aged 75 years and above who solely receive interest income from their pensions are exempted from filing an ITR if the bank deducts the mandatory tax. This simplification reduces the compliance burden for elderly individuals with straightforward income sources.
Staying updated about these changes is crucial for ensuring accurate tax calculations and maximizing your potential tax benefits. Consulting with a tax professional can provide personalized guidance and help you navigate these changes effectively.
