Budget 2021 Highlights

Finance Minister (FM) Nirmala Sitharaman has presented the Union Budget 2021 of India on the 1st of February, 2021. Here are the key Highlights from Budget 2021:

♦ Relief to senior citizen: for 75 years and above: Having only pension and interest income: exemption from filing ITR: Paying banks will do TDS

♦ Reassessment: from 6 years to 3 years Serious tax evasion cases: where evasion evidence is Rs. 50 lac or more then reopening within 10 years-

♦ Dispute resolution committee: it will be faceless:  anyone with total income less than 50 lacs and disputed income less than 10 Lacs can approach this committee

♦ Faceless ITAT: faceless ITAT centre will be set where personal hearings will be conducted through VC

♦ Tax Audits: digital transactions from 5 cr to 10 cr

♦ Advance tax liability on dividend will arise only after declaration of dividend

♦ Affordable housing 1.5 lac deduction will now be even available for loan taken till 31.3.2022

♦ 80IBA: extended 31.3.2022

♦ Tax incentive of affordable renting housing project

♦ Pre filled income tax return will have pre filled data regarding Dividend, post office interest income, salary , capital gain on listed sec etc.

♦ Trusts: educational and hospitals: limit increased from Rs.1 Cr to Rs. 5 crore (10(23C)

♦ Late deposit of employee contribution of PF will now be not allowed as deduction.

♦ FM proposed to amend the Insurance Act to introduce additional FDI to insurance companies from the existing 49% to 74%.

♦ Our FM modified the definition of small companies: companies with a paid-up capital not exceeding 2cr & a turnover not exceeding 20cr are to be considered small companies. Over 2 lakh+ companies benefit from this provision.

♦ FM stated that the IPO of the LIC will be carried out in FY 2021-22. Also, for the disinvestment strategy, two PSUs and 1 insurance company will be considered.

♦ The FM announced that the ‘1 nation-1 ration card’ plan has been implemented by 32 States and UTs. Migrant workers benefit from this scheme as they can claim ration from anywhere in the country.

♦ The total fiscal deficit is pegged at 9.5 % of GDP and it is funded through govt borrowing. An additional 80,000 crore is needed to ensure our economy is given the needed push.

♦ The FM raised customs duty on solar inverters from 5% to 20% and solar lanterns from 5% to 15%.

♦ The FM proposed to withdraw exemption on import of leather as they are domestically produced.

♦ The FM concluded the Budget2021 and the house has been adjourned after getting the consent for the Finance Bill, 2021.

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March 2021