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2015

Budget 2015

Corporate Tax:

  • Reduce from 30% to 25% over next 4 years

Other than Corporate Tax:

  • No changes in Exemption Limit and general tax rate

Additional surcharge of 2% on super rich with Taxable

  • Income over Rs. 1 crore p.a. for Individual, HUF, Firm, domestic company

Wealth Tax:

  • Abolished

Section 80C:

  • Investment in Sukanya Samriddhi Scheme will be eligible for deduction u/s 80C AND any interest received on such investment will be exempt AND Amount Withdrawn from the scheme shall not be liable to tax ( Applicable retrospectively w.e.f.01/04/2015)

Section 80CCC:

  • Contribution to Pension funds : Increase in limit from Rs. 1 lakh to Rs. 1.5 lakh

Section 80D:

  • Increase in the Limit of deduction of health insurance premium:
    Person Old Deduction Limit Proposed Deduction Limit
    Below 60 years 15,000 25,000
    Senior Citizen (Above 60 years) 20,000 30,000

    Note :

    Very Senior citizens above the age of 80 years, who are not covered by health insurance, to be allowed deduction of Rs. 30,000 towards medical expenditures

Section 80DDB:

  • Payment for Medical treatment of very senior citizens introduced at Rs.80,000
  • Changes made in Conditions of Section80DDB
  • Now prescription to be obtained from specialist doctor instead of certificate from Government Hospital

Section 80DD:

  • Expenditure incurred for medical treatment or payments to LIC/insurer under a scheme for dependent-
  • In case of disability deduction increased–From Rs.50,000 to 75,000 &
  • In case of Severe Disability, deduction increased From Rs.1,00,000 to Rs.1,25,000

Section 80JJAA:

  • Benefit of deduction for additional wages paid to new workmen extended to ALL ASSESSEES instead of Corporate Assessee only.
  • Minimum no. of workmen to be employed reduced to 50 instead of 100.

Section 80U:

  • In case of person suffers from disability deduction increased From Rs. 50,000 to Rs. 75,000
  • In case of person suffers from Severe Disability, deduction increased From Rs. 1,00,000 to Rs. 1,25,000

Section 80CCC:

  • Contribution to Pension Fund (Any annuity plan of LIC or other insurer) From Rs.1,00,00 to Rs.1,50,000

Section 80CCD:

  • Contribution to Pension scheme of Central Government.
  • New subsection 80CCD (1B) inserted where by additional deduction upto Rs.50,000 over and above deduction u/s80CCD(1) allowed.
  • 80CCD(1A) omitted-Threshold limit of Rs.1,00,000 removed.
  • Furnishing of Form15G/15H allowed for non-deduction of TDS from payments receivable under Life insurance policies, not covered by section 10(10D).

Deduction and Exemption:

  • 100% deduction for National Fund for Control of Drug Abuse & Tax benefits for Swachh Bharat Kosh and Clean Ganga Fund.
  • More funds included in 100% bracket for donations u/s 80G:
    • National Fund for Control of Drug Abuse
    • Swachh Bharat Kosh – w.r.e. from 01-04-2015
    • Clean Ganga Fund – w.r.e. from 01-04-2015
  • Deduction NOT available if Donations to Swachh Bharat Kosh & Clean Ganga Fund considered as apart of CSR Activities u/s135 of Companies Act 2013

TDS Provisions on Transporters REINTRODUCED

  • Provisions of Finance (No.2) Bill, 2009 intended to exempt only small transport operators (as defined in section 44AE of the Act) from the purview of TDS, however the said amendment, however the said amendment was being used as a tool for avoiding compliance by large transporters as well.
  • Accordingly, it is proposed to amend the provisions of the Act to expressly provide that the relaxation under section 194C (6) of the Act from non-deduction of tax shall only be applicable to the payment in the nature of transport charges made to an contractor who is engaged in the business of transport AND who is eligible to compute in come as per the provisions of section 44AE of the Act AND who has also furnished a declaration to this effect along with his PAN.

Other Amendment

  • Additional Depreciation in case of Assets used for Less Than 180 days.

    • 50% of the Additional depreciation i.e.10% to be allowed in the year of purchase; and
    • Remaining 50% deduction of additional depreciation u/s32 (1) (iia) to be allowed in immediate subsequent year.
  • Emphasis to promote ‘Yoga’

    • Yoga considered as an activity of charitable purpose defined u/s2(15).
  • Seized Cash

    • Seized cash can be adjusted towards assessee tax liability.
  • Charitable Institution:

    • Ceiling on receipts from activities in the nature of trade, commerce or business modified from existing Rs. 25 lakh to 20% of total receipts.
  • Direct Tax Code (DTC)

    • May be revamped or scrapped
  • Swachh Bharat Cess @ 2% or less

    • Enabling provision added to levy in case if need arises

Measures to prevent Black Money

  • Acceptance or repayment of advance of Rs. 20,000 or more in Cash for purchase of immovable property – Prohibited
  • PAN : Mandatory for purchase or sale exceeding Rs. 1 lakh
  • Benami Transactions (Prohibition) Bill to be introduced : Key Features of new law on black money
    • Evasion of tax in relation to foreign asset
      • Imprisonment upto 10 Years and Penalty rate 300%
    • Non filing of return/ Return with inadequate disclosures
      • Imprisonment upto 7 years.
    • Undisclosed income from any foreign asset
      • Taxable at maximum marginal rate
    • Mandatory filing of return in respect of foreign asset

Indirect Taxes

 
  • Excise Duty (General): Increase from 12.36% to 12.50 %
  • Service Tax: Increase from 12.36% to 14%
  • Time limit for taking Cenvat Credit on inputs and input services increased from 6 months to 1 year
Financial Management