What’s likely to be changed in income tax rules on April 1st 2022.
1. 30% tax on profits derived from the sale of digital assets
Since April 1 all types of digital digital assets (also known as crypto assets) that are sold for profit will be subject to an additional tax at 30 percent.
In addition, the 1 percent TDS is set to take effective from July 1 2022. The threshold amount for TDS will be set at Rs50,000 per year for certain individuals that include HUFs and individuals who must have their accounts audited as per the I-T Act.
2. Losses from crypto can’t be offset against crypto gains or other assets.
The government has banned losses that are incurred by a specific crypto asset from being offset against the income earned from another form of a cryptocurrency. In contrast to certain investments like stocks mutual funds, real estate, you’ll have to pay the 30 percent tax on your total profit and not the ‘profit less loss’.
3. Filing of a revised ITR in order to fix any errors that were in the initial file
Taxpayers can prepare an updated return beginning April 1 to correct any mistakes or errors made on taxes on income. The updated return is filed within two years after the date of the assessment year.
4. NPS deduction for state govt. employees
State employees will now be eligible to claim deductions in accordance with Section 80CCD(2) to claim NPS contribution from the employer as high as 14% of the base salary and dearness allowance which is in accordance with the deduction offered to Central government employees in the section.
5. The tax on PF account
The government has taken the decision to tax interest earned in the Provident Fund account from April 1st.
If the amount of the contribution is lower than Rs. 2.5 lakh the tax will not be charged. However , if the contribution exceeds Rs2.5 lakh, the interest earned is taxed.
6. Tax relief for Covid-19 treatment costs
According to the press release from the month of June, 2021 tax exemptions have been granted to those who have received funds in exchange for Covid health care.
Also, any cash received by relatives on the passing of a patient due to Covid will be exempted up to Rs 10 thousand for members of the family provided this payments are received in the 12 month period of when the death occurred. This change will become effective retroactively on April 1st in 2020.
