On September 1, India will witness a lot of changes, which are directly related to the common man's pocket. These changes, perhaps, will greatly affect day-to-day life. From Tax Deduction at Source (TDS) to new changes in traffic rules, from Aadhaar- PAN link to KYC update and so on, here are 10 crucial finance-related things that will be effective from September 1.
1. TDS at the time of purchasing an immovable property
From September 1, payments such as club membership fees, car parking fees, electricity and water facility fees, maintenance fee, advance fee and so on, will be included in the cost of buying property amount while calculating the amount of tax to be deducted at the time of making payment for a property.
A buyer will be required to deduct TDS at the rate of 1 per cent of purchase price while buying an immovable property of more than Rs 50 lakhs with effect from September 1.
2. Cash withdrawals over Rs 1 crore to attract 2% TDS from September 1
There will be a two per cent tax deduction on cash withdrawals of Rs 1 crore or more than that from banks or post offices from Sunday, September 1. The government had made the provision of levying two per cent TDS on cash withdrawals exceeding Rs 1 crore in the Budget 2019 with an aim to discourage cash transactions and move towards a less-cash economy.
The Central Board of Direct Taxes (CBDT) said that if a person has already withdrawn Rs 1 crore or more in cash up to August 31, 2019, in the current fiscal, the two per cent TDS shall apply on all subsequent cash withdrawals.
3. TDS on payments made by HUF/Individual to professionals and contractors
If the payment made to a contractor or a professional or brokerage exceeds Rs 50 lakh in a year, an individual or HUF (Hindu Undivided Family) is required to deduct 5 per cent TDS at the time of crediting such amount.
4. PAN-Aadhaar linking deadline is September 1
Those who have not linked their pan cards with Aadhaar will be issued a new PAN. The older PAN will be considered invalid. If you have not done yet, here's a quick step to link your Aadhaar with PAN:
You can send an SMS to 567678 or 56161 from your registered mobile number in the following format - UIDPAN
For example: UIDPAN 012345678910 ABCDE1964F
5. IRCTC to restore service charges on e-tickets
E-tickets bought through IRCTC will get costlier as the Indian Railways has decided to restore service charges from September 1. The IRCTC will levy a service charge of Rs 15 per ticket for non-AC classes and Rs 30 for AC classes, including first class. Goods and Services Tax (GST) will be applicable separately.
6. New traffic rules
The government has notified that the provisions of the Motor Vehicles Act 2019 will be implemented from September 1. According to the new law, the drunken driving penalty has been increased to 6 months imprisonment and/or Rs 10,000 fine for the first offence and 2 years imprisonment and/or fine of Rs 15,000 for the second offence. The current penalty is Rs 2,000. The penalty for racing and speeding has also been increased to imprisonment of up to 1 month and/or fine up to Rs 500 for first offence and imprisonment of up to 1 month and/or fine of up to Rs 10,000 for the second offence.
7. Launch of India Post Payment Bank (IPPB)
Prime Minister Narendra Modi on September 1 will launch the long-awaited India Post Payments Bank (IPPB) that will have at least one branch in every district and focus on financial services in rural areas. This will create the country's largest banking network with direct presence at the village level. With the third party tie-ups, account holders in IPPB will be able to avail financial services as in the case of a regular banking customer. The payment bank will be used by the government to distribute MNREGA wages, subsidies, pension etc.
8. Changes in SBI home loan and auto loan
Home loans and auto loans of the State Bank of India (SBI) will be repo-linked from Sunday, September 1 at interest rates starting from 8.05 per cent. The new interest rates will be applicable to all existing and new loans. This means, any changes in the key interest rate by the RBI would be passed on directly to the customers.
9. Buyers must pay up to Rs 24,000 on insurance for new vehicles
All general insurers will offer long-term third-party insurance on vehicles sold on or after September 1. prospective vehicle buyers will have to pay more than Rs 24,000 for new cars and over Rs 13,000 for new motorcycles in third-party insurance.
10. KYC update
People using mobile wallets like Paytm, PhonePe or GooglePay will have to complete their KYC before 31 August. If in case they fail to do so, the central bank would block all their mobile wallet accounts from September 1, 2019.
Copyright©2021 Living Media India Limited. For reprint rights: Syndications Today