CA Pratik Anand
The financial year is over and time for filing the income tax return for FY 2014-15/AY15-16 is around the corner. In this situation, following are some important points that every individual must know for filing income tax return this year.
1. Basic exemption limit increased by INR 50,000 to INR.2,50,000 for Individuals taxpayers.- Income Tax Rate Chart / Slabs for AY 2015-16 / FY 2014-15
3. Deduction limit for interest expense in respect of self-occupied property raised from INR 150,000 to INR 200,000. Read- Home Loan Interest Exemption Limit increased to Rs. 2 Lakh
4. Long term capital Gain on sale of units of Mutual Fund (other than equity oriented) @20%.
5. Amendment in the criteria of holding period for treating an asset as Short Term Capital Asset, as under:
For share in Company (listed) – 12 months;
For share in Company (unlisted) – 36 months;
For other unlisted securities – 36 months;
For other listed securities (including units of Business Trust) – 12 months;
For unit of Mutual Fund (equity oriented) – 12 months;
For unit of Mutual Fund (other than equity oriented) – 36 months;
For zero coupon bond – 12 months
6. As per CBDT circular No. 6/2015 dt. 09.04.2015, No Capital gains will arise in respect of units of Mutual Funds under the Fixed maturity Plans on extension of their term.
7. Plugging of loop hole to prevent misuse of Section 54EC
Investment within six months from the date of transfer of the asset in specified securities not exceeding fifty lakh rupees is only permitted.
Investments within six months but in different financial years of upto 50 lacs each are not allowed.
8. Investment only in one residential house in India allowed for claiming exemption under Section 54 or Section 54F. Read-Budget 2014 – Benefit U/s. 54 / 54F available only if investment is made in one residential house situated in India
9. No exemption allowed for investment in Residential House located outside India.
10. Advance received and forfeited in relation to a transfer of capital asset now taxable immediately under the head ‘income from other sources’ and not to be reduced from the cost or written down value or the fair market value, as the case may be, in computing the cost of acquisition of such asset. Read- Budget 2014 – Advance forfeited against transfer of Capital Assets taxable as other Income as Income from other sources
11. Presumptive income in respect of taxpayers engaged in the business of plying, hiring or leasing goods carriages increased to a uniform amount of INR 7,500 per month for all types of goods carriages. Read- Budget 2014- Presumptive income amount increased to Rs. 7500 for Business of Plying, Hiring or Leasing Goods Carriages
12. Employer’s contribution to NPS by non-Central Government employers eligible for deduction up to ten per cent of salary in a financial year, irrespective of the employees’ date of joining of employment and without any limit. The deduction in respect of employee’s contribution is restricted to INR 100,000 within the overall limit of Section 80CCD. Also Read- Extension of tax benefits U/s. 80CCD to private sector employees
13. Aggregate payments of INR 100,000 or more under life insurance policy not exempt under Section 10(10D) liable to withholding tax at two per cent. Also Read- TDS on non-exempt payments made under life insurance policy
14. Transfer of government security, carrying a periodic payment of interest, by a non-resident to another non-resident and made outside India through an intermediary dealing in settlement of securities not to be regarded as transfer and accordingly not liable to capital gains tax. Read- No Tax on Transfer of Government Security by one non-resident to another non-resident
15. Trading in commodity derivatives carried out through a recognised association and which is chargeable to commodities transaction tax will not be treated as a speculative transaction. Trading in commodity derivatives not to be considered as a speculative transaction
Some More Points to Take care (Updated on 08.07.2015)
1. it is proposed that only the IFSC Code and account number of all the current/ savings account, which are held at any time during the previous year, will be required to be mentioned.
2. In respect of foreign travel details, excessive disclosures like details of foreign trip or expenditure incurred will not be required to be filled up. Instead, only passport No. would be required to be given.
3. An individual or HUF who does not have capital gains, income from business/profession or foreign asset/foreign income can file a shorter version of ITR2, i.e. ITR 2A.
4. E-Filing mandatory if claiming refund by Individuals/HUF.
5. An individual, who is not an Indian citizen and is in India on a business, employment or student visa (expatriate), would not mandatorily be required to report the foreign assets acquired by him during earlier years in which he was non-resident if no income is derived from such assets during the relevant previous year.
It comes as a big relief for the expatriates who come to India for employment and may qualify for resident and ordinary resident (ROR) in India considering their duration of stay in India.
6. No filing of hard copy of acknowledgement with CPC Bangalore if Aadhar No. is given in the return.
7. Last date of filing of filing return has been extended to 31.08.2015.