Union Budget 2021: Announcements were made in the field of agriculture to the health sector, which would benefit the common people as well as the sector. This budget will also have a big impact on your pocket and deposit. Somewhere you can get benefit, then there can be loss too.
Union Finance Minister Nirmala Sitharaman presented the General Budget in Parliament on Monday. This is the first budget of the new decade. In the budget, the finance minister has made important announcements for many sectors. Such announcements were made from agriculture to the health sector, which will benefit the common people as well as the sector. This budget will also have a big impact on your pocket and deposit. Somewhere you can get benefit, then there can be loss too. Let’s know about those five budget announcements that can benefit or harm you.
1. Now PF will be taxed
Those investing in provident funds have received a big setback. Nirmala Sitharaman announced that now investing only up to 2.5 lakh rupees in a financial year will get the benefit of tax exemption. Meaning if you have invested more than that, then the interest earned will come under the tax net. Currently the interest rate on PF is 8 percent and the interest income is completely tax free. This rule will be applicable from 1 April 2021. According to the new rule, if a contributor has invested more than 2.5 lakhs in PF annually, then the income from interest on additional investment will be taxable.
2. Relief to home loan customers
The Finance Minister announced that it is proposed to extend the tax deduction by one more year up to 1.5 lakh rupees on the interest payment of home loans for the purchase of cheap houses. Nirmala Sitharaman has extended the limit of additional exemption up to 1.5 lakh on interest under section 80EEA for one year. Now this scheme can be availed by 31 March 2022. Earlier, the deadline for this scheme was ending on 31 March 2021.
3. Tax on ULIP
In ULIP (Unit Linked Insurance Plans), if you pay a premium of more than 2.5 lakh rupees in a year, then the tax exemption available under section 10 (10D) has been removed. This rule will not apply to existing ULIPs. This will be effective only on policies sold after February 1 this year.
4. Senior citizens will not have to file ITR
The government has given relief to the elderly above 75 years in the budget. It was announced in the budget that such elderly people above 75 years who depend only on pension and interest income from deposits, will not need Income Tax Return Filing (ITR). The paying bank will deduct the required tax on their income. However, for this benefit it is necessary that pension and interest income come to the same bank.
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5. Capital gains will not be taxed for one more year
Taxpayers have been given tax relief for one year on the capital gains. Tax holiday on capital gains has been extended for 1 year to entice investors to startups. Apart from this, the tax holiday for startups has been extended for one year. Now its deadline has been extended till 31 March 2022. Earlier this deadline was ending on 31 March 2021.
