Union Budget 2017: Tax proposals in annual Budget explained
BT Online February 1, 2017
The Union Budget 2017 was presented before the Parliament today by Finance Minister Arun Jaitley.
Here are the salient features of Direct Tax proposals:
1. Three concessions in the scheme of Income Tax exemption for affordable housing:
2. Tax on Notional rental income for builders to be calculated only after 1 year from the end of the year in which completion certificate is received.
3. Changes in Capital Gain taxation for immovable properties:
4. Basket of financial instrument in which capital gain can be invested without payment of tax to be expanded.
5. For joint development agreement, the liability to pay capital gain tax will arise in the year in which project is completed.
6. For Andhra Pradesh capital, land belonging to owners as on 2.6.2014 to be exempted from capital gain if the same is offered under land-pooling
1. Concessional withholding rate of 5 per cent for interest received by foreign entities on loans given in India to be continued for another 3 years beyond Jun 30, 2017.
2. Start-ups to get two relaxations under the scheme of Income Tax holiday given last year.
3. The period of carry forward of MAT/AMT credit increased from 10 years to 15 years.
4. The corporate income tax to be reduced from 30% to 25% for companies with turnover uptoRs.50 crore in 2015-16. This will benefit 96% of existing 6.67 lakh companies. This will result into tax saving of 16.67% for these companies.
5. Deduction for provision for NPA of Banks to be increased from to 8.5% instead of7.5% of profit.
1. In the presumptive income tax for small traders, income to be taken as 6% of turnover which is received by digital or banking means.
2. Cash expenditure allowable to be reduced to Rs.10,000 from the existing Rs.20,000.
3. Cash transaction of above Rs.3 lakh not to be permitted. The penalty of equal amount to be levied in case of breach.
IV Transparency in Electoral Funding:
3. Political parties to file their return in time limit prescribed in the Income Tax Act.
V. Ease of Doing Business:
2. The audit limit for business entities opting for presumptive scheme to be increased from Rs.1 crore to Rs.2 crore.
3. Individuals and HUFs not required to keep books of accounts if their turnover is up to Rs.25 lakhs or income is upto Rs.2.5 lakhs.
4. Investment in Category 1 and 2 foreign portfolio investors registered with SEBI to be exempted from provisions of indirect transfer.
5. TDS of 5% not to be deducted for individual insurance agents if they certify their income to be below taxable limit.
6. Professionals in presumptive scheme to pay advance tax only in one instalment in March instead of four.
7. The time limit for revising a tax return reduced to 12 months. Also time limit for completion of scrutiny will be brought down to 12 months from
VI Personal Income Tax: