Changes in Income Tax Act w.e.f 01.04.2018
Finance Act 2018 has been assented by the President of India on 29th March 2018.sections 2 to 55 of Finance Act 2018 shall come into force on the 1st day of April, 2018
LTCG (Long Term Capital Gain ) reintroduced :-
After a gap of 14 years, the long-term capital gains tax was reintroduced in the by Finance Act 2018.
A 10 % tax will be levied on equity investments exceeding Rs 1 lakh from sale of shares.
[ Before Finance Act 2018 taxpayers used to pay a 15 % on capital gains made on share sale within a year of purchase. If the shares are sold after a year, the tax was nil. ]
TDS Rates FY 2018-19 :-
Rates for deduction of TDS for FY 2018-19 are given in Part II and Part III of THE FIRST SCHEDULE
Note : Health and Education Cess on income-tax has been imposed @ 4%of such income-tax and surcharge by Finance Act 2018
[Download Finance Act 2018 PDF File ]
Tax exemptions were announced on deposits with banks and post offices for senior citizens only. Interest income will now be increased five times from Rs 10,000 to Rs 50,000.
TDS (tax deducted at source) under section 194A will not be applicable on any income on fixed deposit s or recurring deposit schemes for the senior citizens.
TSC Rates FY 2018-19
Due Dates of Various Income Tax Payments
Refer month wise Due dates as per Income Tax Calendar 2018-19
Health and Education Cess for FY 2018-19
Health and Education Cess on income-tax has been imposed @ 4%of such income-tax and surcharge by Finance Act 2018
There will be no Secondary and Higher Education cess w.e.f FY 2018-19.
Standard deduction for Salaried Employees
Though the tax slabs were not changed this year, the finance minister reintroduced the standard deduction under the head “ Income from Salary “
A standard deduction of Rs 40,000 will be effective in lieu of transport allowance and medical reimbursement.
The Central Board of Direct Taxes had previously said that the standard deduction can be claimed directly and would not require any proofs or bills to avail it
Medical, travel allowances will be taxed
Medical allowances and travel allowances will be taxed from Financial Year 2018-19 .
Before Finance Act 2018 , Medical allowances up to Rs 15,000 and travel allowance till Rs 1,600 per month used to be tax free and could be claimed by furnishing bills.
Limits for Senior citizen on medical expenses :-
The deduction limit for health insurance premium or medical expenditure was increased from Rs 30,000 to Rs 50,000 under section 80D.
The deduction limit for medical expenses for critical illness was also hiked from Rs 60,000 (for senior citizens) and Rs 80,000 (for very senior citizens) to Rs 1,00,000, under section 80DDB.
Pradhan Mantri Vaya Vandana Yojana
Pradhan Mantri Vaya Vandana Yojana was extended up to March 2020, under which senior citizens can invest up to Rs 15 lakh.
Before Finance Act 2018 the limit was Rs 7.5 lakh per senior citizen.
Dividend Distribution Tax on equity MFs
Dividend distribution tax (DDT) was introduced on equity mutual funds at the rate of 10 % in Finance Act 2018
National Pension System is tax free
The withdrawal of pension money was made tax free for non-employee subscribers.
Before Finance act 2018 , There is no such provision at present.