As you are aware that Union finance minister Arun Jaitely presented Finance Budget 2017 on 1st January 2017 with some exciting announcements for Individuals and Industry.
Below are the Important take away from the Union Budget 2017 for you ready reference.
- Reduces income tax rate from 10% to 5% for tax slab of Rs 250,000 to Rs 500,000.There is additional existing Rs.2500 Rebate for the Income below 3.5 lacs
- All tax payers (above Rs 5 lakh) to get benefit of Rs.12,500.
- Effective NIL tax for taxable Income upto 3 lacs
- Carpet area of 30sq. mtr and 60sq. mtr will be counted for affordable housing scheme instead of earlier built up area
- 3 year period for long-term capital gains tax on immovable property reduced to 2 years; base year indexation shifted from 1.4.1981 to 1.4.2001
- A scheme for senior citizens to ensure 8 per cent guaranteed returns.
- Aadhar based smart card for senior citizens: Scheme for senior citizens to give them assured income and health benefits
- Service charges on e-tickets booked from IRCTC website will be withdrawn
- Surcharge of 10% on income between Rs 50 to 1 crore
- Existing surcharge of 15% on people earning more than 1 crore will continue
- A single one-page form for filing IT returns for taxable income up to Rs 5 lakh
- Withdrawn deduction for 1st time investors in listed equity shares or listed units equity oriented fund under Rajiv Gandhi Equity saving scheme from 2017-18.If benefit is claimed in scheme before April 1st 2017, then he/she shall be allowed to avail deduction for next two year.
- Time Period for revision of tax return cut to one year (from 2 years) from the end of relevant financial year or before completion of assessment whichever is earlier.
- Housing loan Interest deduction in respect of let-out property vs self-occupied property, it is proposed that the set-off of loss under the head “income from house property” against any other head of income will be restricted to Rs.2 lakh for any assessment year. And the loss not set off will be allowed to be carried forward for set off against house property income for eight assessment years.
Earlier, for properties rented out, a borrower could deduct the entire interest paid on the home loan, after adjusting rental income. However, now the borrower could claim deduction of up to Rs. 2 lakh only after adjusting for rental income. As earlier individuals used to buy properties on loan and were allowed to set off the full interest liability against the let out value of property usually resulting in loss which would substantially bring down tax liability and borrowing costs. This option is now not available and loss above 2 lakh will have to be mandatory carried forward to next year maximum up to 8 years.
- Presumptive tax rate for Turnover upto 2 crore reduced to 6% from 8%
- Increase in carry forward of MAT (Minimum alternate tax) credit to 15 years from 10 years
- Small Companies with Turnover upto 50 crore will have tax rate of 25% accounting to approx. 96% companies
Others Important announcements
- Maximum cash donation only Rs 2000 for political parties
- No cash transaction above Rs 3 lakh will be allowed
- No major change in service tax and Excise ad GST is awaited to replace the same
- Govt will launch two new schemes to promote the use of Bhim (an payment application to promote unified digital transaction )
- Defense budget by 10 per cent to Rs 2,74,000 crore