Interim Budget 2019-20. Highlights of tax benefits exemption given

Interim Budget 2019-20 Highlights of Income Tax Relaxations and Benefits given

Union Finance Minister Shri Piyush Goyal has started presenting the Interim Budget 2019 at the Lok Sabha

In view of the elections ahead, it was speculated that the Budget would bring increased tax benefits specially for individuals taxpayers.

The income tax benefits can be thought of in terms of increase in basic income tax exemption slab/threshold, enhancement of investment limit for qualifying deduction under Section 80C, exemption on savings bank interest, enhancement in section 87A rebate etc.

This post shall be updated for Interim Budget Proposals. Bookmark the page and revisit to read the Income Tax/Direct Tax highlights. 

Highlights of the Direct Tax Proposals for AY 2020-21

1. 100 Percent tax rebate u/s 87A up to total income of Rs. 5 lakhs.

Section 87A of the Income-tax Act amended to provide relief to the individual taxpayers by increasing the maximum amount of tax rebate to twelve thousand five hundred rupees from existing two thousand five hundred rupees.

The tax rebate shall now be admissible to taxpayers having total income up to five hundred thousand rupees, instead of existing three hundred fifty thousand rupees.

Thus, considering 80C deduction income up to Rs. 6.50 lakhs will be out of tax net Read more >>

2. Standard deduction u/s 16(ia) from salary income raised to 50 lakhs

Amendment made to section 16 of the Income-tax Act to provide relief to the salaried taxpayers by way of increasing the amount of deduction from salary income, from existing forty thousand rupees to fifty thousand rupees

3. Nil Annual value for two self occupied residential house

Amendment made to section 23 of the Income-tax Act so as to provide relief to the taxpayer by allowing him an option to claim nil annual value in respect of any two houses, declared as self-occupied, instead of one such house as currently provided. It further seeks to provide relief to the taxpayers that notional rent in respect of unsold inventory shall not be charged to tax up to two years, instead of existing one year, from the end of the financial year in which the certificate of completion is obtained from the competent authority.

Simultaneously section 24 amended to provide that the monetary limit of deduction on account of interest payable on borrowed capital shall continue to apply to the aggregate of the amounts of deduction in case of more than one self-occupied houses.

4. No TDS u/s 194A on interest on fixed deposits up to Rs. 40 lakhs

Amendment made to section 194A of the Income-tax Act so as to ease the burden of compliance by way of increasing the threshold limit from ten thousand rupees to forty thousand rupees, for deduction of tax at source on
interest income, other than interest on securities, paid by a banking company, co-operative society or a post office.

5. No TDS on rent u/s 194I up to Rs. 2.40 lakhs p.a.

Section 194-I of the Income-tax Act amended to rationalise the threshold limit from one hundred and eighty thousand rupees to two hundred and forty thousand rupees, for deduction of tax at source on rental income.

6. Capital gain deduction allowed for purchase/construction of 2 new houses 

Amendment made to section 54 of the Income-tax Act so as to provide relief to the taxpayers having long-term capital gains up to two crore rupees, arising from transfer of a residential house, by affording the assessee a one time opportunity, at his option, to utilise the said amount for the purchase or construction of two residential houses in India instead of one residential house as currently provided.

7. Deduction to Housing Projects u/s 80IB extended for one more year

To augment the supply of affordable houses, Section 80-IBA of the Income-tax Act amended by extending the time limit from 31st March, 2019 to 31st March, 2020 for obtaining approval of the housing project.

8. No change in income tax basic slabs, rates or surcharge

Download Finance Bill 2019 Click Here >>