Below changes / Provisions are applicable for Financial Year 2018-19 (Assessment Year 2019-20)

1. Tax Exemption limit is Rs. 2,50,000/- for non Senior citizens. After that, up to 5 Lakh, Tax rate is 5%.  Tax Rate of 5% is applicable from Financial Year 2017-18 and also applicable for Financial Year 2018-19.

Tax Rate for Individual/HUF/AOP/BOI

(Amount in Rs. )

Tax Rates % Age below 60 years Senior Citizen
Ageed above 60 Years and below the Age of 80 Years
Super Senior
Citizen
Age  aged above 80 Years
0 Up to 2,50,000 Up to 3,00,000 Upto 5,00,000
5 2,50,001 to 5,00,000 3,00,000 to

5,00,000

20 500001 to 10,00,000 5,00,001 to

10,00,000

500001 to

10,00,000

30 Above 10,00,000 Above 10,00,000 Above 10,00,000

Rate of Surcharge on Individual/HUF/AOP/BOI/ Artificial  Juridical Person

Total Income in the Range of Rs.50 Lakh – Rs.1 crore Rs.1 crore – Rs.10 crores Above Rs.10 Crores
Individual/HUF/AOP/BOI/ Artificial  Juridical Person 10% 15% 15%

Existing Education cess of 2% and Secondary and Higher Education Cess of 1% has been abolished and a new cess by the name “Health and Education Cess” at the rate of 4% will be levied on the amount of income tax and surcharge.

2. Payment of Rent – Rs.50,000 per month by any Individual or HUF (not subject to Tax Audit requirement) – Deduct TDS @ 5%.

3. Cess levied on your tax liability has been hiked by 1 per cent from the current 3 per cent to 4 per cent.

4. Tax rebate is reduced to Rs. 2500 from Rs. 5000 per year for taxpayers with income up to Rs. 3,50,000 (earlier Rs. 5,00,000) with effect from financial year 2017-18.

5. Increase the tax exempt limit on interest income for senior citizens from Rs 10,000 to Rs 50,000 vide newly inserted section 80TTB wef Financial Year 2018-19.

As per the provisions of Sec 80TTB, deduction upto Rs.50,000/- will be allowed to senior citizens who have interest income from deposits with banks or post office or co-operative banks. Interest on saving and fixed deposit, both shall be eligible for deduction under this provision. Earlier deduction u/s 80TTA upto Rs.10,000/- will not be available to senior citizens in respect of interest on saving deposits.

Further, corresponding amendment has also been made in section 194A which provides that no tax shall be deducted at source from payment of interest to a senior citizen upto Rs.50,000/-.

6. Limit for payment of expenses by cash (Both capital and revenue expenditure) reduced from RS. 20,000 to RS. 10,000 per day in aggregate per person.

7. There is a standard deduction of Rs. 40,000 for salaried assessee in lieu of transport allowance and medical reimbursement. This standard deduction will benefit the pensioners also, who normally do not enjoy any allowance on account of transport and medical expenses. (Provision in inserted with effect from Financial Year 2018-19 vide insertion of New clause (ia) under section 16 of Income Tax Act, 1961.

8. No Person shall receive an amount of two lakh rupees or more, by cash (Sec 269ST).

9. Those companies whose turnover is up to Rs. 250 crore, will now have to pay corporate tax at the rate of 25%.

10. Late fee if IT Return not filled on time,Rs.5,000 for delay up to 31st December, and Rs.10,000 thereafter.

11. A simple one page tax return form is to be introduced for Individual with taxable income up to Rs. 5 lakh (excluding Business Income).

12. Those filing returns for the first time in this category will generally not be subject to scrutiny.

13. It is mandatory to disclose the Aadhar number while filing IT Return.

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Founder of RocGuru.com. Through our online platform we assist entrepreneurs to register their Startups and manage their compliances through a Company Secretary, Chartered Accountant, Cost Accountant and Lawyers at a reasonable Cost. Contact details: e-mail- rocguru.com @ gmail.com Website: www. View Full Profile

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Tags : income tax act 1961 (267)

22 responses to “13 changes in Income Tax applicable from 1st April, 2018”

  1. Gaurav says:

    Sir,
    What about Section 80CCE deduction?

  2. V Nayak says:

    Dear Karan Kattri,
    Very informative article. Thanks for the efforts you have put in. However it sad to note that the Banks especially almost all psu banks have still not changed their software to implement the new tds exemption upto Rs 50,000/- for Sen. citizens.They bluntly dictate to fill & submit form 15H just like before even if the interest income is below Rs. 50,000/-. The Government proposes but our lethargic bureaucracy seldom disposes.

  3. srinu says:

    IF YOU NEED ANY ASSISTANCE TO FILE ITR PLIASE CONTACT 7386887732 (SRINU)

  4. M. Moni says:

    I am 70 years old. For FY 01/4/2017–31/3/2018 (A.Y. 2018-2019), can I file ITR manually or do I have to “e-file”? My total income is less than 5 lakhs. Pl. clarify.

    • Karan Khattri says:

      Hi M Moni Sir,
      There is no change in the manner of filing of ITR Forms as compared to last year. All these ITR Forms are to be filed electronically. However, where return is furnished in ITR Form-1 (Sahaj) or ITR-4 (Sugam), the following persons have an option to file return in paper form:-

      (i) an Individual of the age of 80 years or more at any time during the previous year; or

      (ii) an Individual or HUF whose income does not exceed five lakh rupees and who has not claimed any refund in the Return of Income.

      For detail article: http://rocguru.com/cbdt-notifies-income-tax-return-forms-for-assessment-year-2018-19/

  5. GANDHI MOHAN BHARATI says:

    Lots of errors.
    Earlier year for <5.00 Lakhs Tax Rate was 5% and NOT 10%

    • Karan Khattri says:

      Hi Gandhi Mohan Ji,
      Please don’t pass any negative comment without knowing the fact. At least ask me the reason or you need any clarification then i will explain you.

  6. kantilal says:

    GOOD ADVICE

  7. rugram says:

    The following points need to be clarified:
    1. “Applicable from 1st April, 2018” – Whether this relates to financial year or assessment year.
    2. Item 1 is for non-senior citizens and has been in force for FY 2017-18 or earlier. Basic non-taxable limits for senior citizens and super senior citizens are different.
    3. Item 4 was in effect from FY 2017-18.
    4. Item 5 – needs to be clarified that Rs 10,000/- was only towards interest from savings bank accounts while Rs 50,000/- applies to all interest, whether from savings bank accounts or fixed deposit accounts, recurring deposit accounts. No separate deduction for savings bank interest is allowed for senior citizens for FY 2018-19, but non-senior citizens will be allowed deduction upto Rs 10,000/- from only savings bank accounts. (These are only the upper limits in the respective categories. If the actual interest amounts are less than these limits, then the deduction is restricted to the actual interest amounts.)
    5. Item 7 – This is applicable only to salaried and pensioner assessees.

    Thanks.

    • Karan Khattri says:

      Hi Rugram,
      Thanks for your comment.
      1. Yes,Provisions are applicable from 1st april, 2018 onward( only few applicable from 1st April, 2019)

      2. Limit 250000/- for only non-senior citizens( male and female below 60yrs). Senior and super senior have different slab.
      4. FD interest also includes.
      5. Yes, you are right.

  8. suman deep kumar says:

    what will happen who have not filed for the F/Y 2016-17 please reply

  9. UMESH says:

    i wanted to file Itr a.year 2017-2018 pls give advice, online not possible and message shown is date is over.. pls give advise

    • Karan Khattri says:

      Hi Umesh,
      Thanks for the comment.
      you can’t file return for the AY 2017-18 now.

    • srinu says:

      IF YOU WANT TO CLAIM ANY REFUND THEN ITS BETTER TO FILE INCOME TAX RETURN, OTHER WISE LEAVE IT. EVEN IF YOU WANT TO FILE INCOME TAX RETURN YOU NEED TO PAY SOME PANALITY AMOUNT ACCORDING TO SEC 234A,234B,234C

  10. UMESH says:

    can we still file ITR for A. Year 2017-2018?

  11. Puja says:

    pt no 5 & 7 are applicable from 1st April 2019 and not 1st April 2018.

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