Finance Minister Nirmala Sitharaman announced variations in the Tax Deducted at Source (TDS) framework which will affect salaried individuals. The tweaks will affect disposable income and streamline tax processes, the Finance minister announced, stating, "A beginning is being made in the Finance Bill by simplifying the tax regime for charities, TDS rate structure, provisions for reassessment and search provisions and capital gains taxation."
Here are four variations in TDS provisions announced by Nirmala Sitharaman that may affect you:
Section 192 of the Act states a tax deduction at source on salary income. Nirmala Sitharaman announced that all TCS paid and TDS deducted under various other sections will also be considered for TDS deducted on salary income by changing the provisions. This will offer more money to salaried employees from October 1, 2024, when the amendments will be implemented.
Till now there was a tax deduction on payment of sale consideration for the sale of immovable properties other than agricultural land. This rule has been unclear in the case of numerous buyers or sellers where the sale value of the immovable property or stamp duty value is over Rs 50 lakh.
This Finance Bill has mentioned that the exemption is only when the total sale value is less than Rs 50 lakh and where there is more than one seller or buyer.
A person or a Hindu undivided family who pays rent over Rs 50,000 for a month or part of a month is expected to deduct TDS equivalent to 5 per cent. The Finance Bill has issued a reduction in the applicable rate of TDS from 5 per cent to 2 per cent.
TCS generated in the name of a minor can only be collected in the name of the minor but the Budget has provided for the changes of TCS credits in the name of the minor with the tax liability of the parent which can be done only when the income of the minor is combined with that of parent.
