From April 1, 2022, there are ten major changes in your financial life.

Tax laws are the rules and regulations that control how, when, and how much taxes must be paid to local, state, and federal governments. As a result, we are worried about just the tax regulations so that we can organize appropriately in terms of investments and savings.

What are the new tax rules

What is the COVID-19 treatment tax exemption rule?

From April 1st, 2022, here are ten ways your financial life will alter.

There are several modifications to the income tax regulations that will take effect in the current fiscal year. Income tax on crypto assets, submission of updated reports, new tax regulations on EPF interest rate, and tax reduction on Covid-19 treatment are just a few of the main changes that took effect on April 1, 2022. Here’s a brief summary of the 10 law rules that came into force on April 1, 2022. 

1. The Crypto Tax

The crypto asset tax system in India is phased in over the course of the financial year beginning April 1. The Union Budget 2022 included a tax component for virtual digital assets (VDA). Relevant provisions for a 30% tax entered into force at the beginning of the financial year, while those relating to the 1% TDS will take effect on July 1, 2022. The FY 2022–23 Budget clarified the imposition of an income tax on cryptocurrencies. The TDS threshold limit would be INR 50K per year for designated persons, which would include individuals or HUFs required to have their accounts audited under the I-T Act. Finance Minister Nirmala Sitharaman broke her silence on the question of legalizing cryptocurrency transactions, saying that the government has merely taxed the income generated by cryptocurrency transactions and has done nothing to legalize, restrict, or regulate it.

Also Read: 5 Cryptocurrencies You Should Know About 

2. The cryptocurrency gifts will be taxed.

Additionally, if someone receives a present in the form of cryptocurrency or any virtual digital asset will be taxed as a gift for this financial year.

3. Crypto losses cannot be compensated for with cryptocurrencies profits or other things.

The Government of India has strengthened crypto laws by prohibiting losses in a certain digital asset from being balanced against turnover from another form of crypto investment. The government will not allow tax benefits on development expenses spent when extracting virtual digital currency since they will not be recognized as financing costs. For instance, if you earn an Rs. 2,000 gain on bitcoin and an Rs. 1400 loss on Ethereum, you must pay tax on the Rs. 2,000 gain rather than the Rs. 700 net profit. Similarly, profits and losses in virtual digital assets cannot be balanced against losses and gains in other investments, such as stocks, mutual funds, or real estate.

Also read: Taxation On Mutual Funds And What You Should Know About It?

4. Submission of a revised IT return

There is a new alternative that allows taxpayers to submit a revised return if they make a mistake or typo on their income tax forms. Taxpayers will now have 2 years from the end of a specific assessment year to file an amended return. The revised return, however, cannot be submitted to claim more loss or a reduction in tax obligation. This provision was added to allow for the inclusion of lost or hidden income, as well as any other error resulting in less tax filing, in the original tax return.

5. State government employees are eligible for NPS deductions.

State government staffs can now claim a tax deduction under Section 80CCD(2) for the employer's NPS contribution of up to 14% of their basic salary and monthly allowance, which is the same as the deduction accessible to central government staffs under this section for the FY22.

6. PF Account Tax

The Central Board of Direct Taxes (CBDT) implemented the Income-tax (25th Amendment) Rule 2021 on April 1, 2022. It implies that an Employee Provident Fund (EPF) account would have a tax-free contribution limit of up to Rs. 2.5 lakh. The interest income will be taxed if the contribution exceeds this amount for the FY22.

7. Tax exemption for COVID-19 medication costs.

A tax exemption has been permitted to those who have received money for COVID medication, according to a business news dated June 2021. Similarly, money received by family members on the death of a person owing to COVID will be excluded from up to Rs. 10 lakh if received within 12 months from the date of death. This amendment took effect on April 1, 2022, for the financial year 2022.

Also read business news on covid 19 insurance policy: https://www.tomorrowmakers.com/personal-finance-news/corona-kavach-policy-will-now-be-available-covid-19-group-insurance-policy-news-article

8. Tax breaks for people with disabilities

The parent or guardian of a physically disabled person can enroll in an insurance plan for that person. Section 80U is introduced for disabled people, and it allows a deduction of Rs. 75,000 for people with impairments and Rs. 1,25,000 for those with severe impairments. Autism, cerebral palsy, and other impairments are also considered severe disabilities in this area.

9. Long-Term Capital Gains Surcharge

LTCG surcharges on the sale of stock or mutual funds were generally capped at 15 percent. This restriction is applied to long-term capital gains on all belongings from April 1, 2022.

10. Section 80 EEA benefits are no longer available.

The first-time home buyers, there was an extra deduction on home loan interest of up to INR 1.5 lakh on houses worth less than Rs. 45 lakh. The Finance Minister has not renewed this program through 31st  March, 2022. As a result, taxpayers will no longer be eligible to claim the extra deduction of Rs. 1.5 lakh beginning April 1, 2022. Other current debits for house loan interests up to Rs. 2 lakh would be maintained under Income Tax Act of Section 24.

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