As per upkeep 2018, there is no transpiration in Income Tax Slab and Rate. So, you must be thinking that nothing is reverted as far as tax is a concern. However, your theorizing is wrong. Finance Minister has introduced 10 new tax changes in upkeep 2018. Most of the changes are unfavorable and will impact on your personal finance badly. Let’s take a squint at 5 New Tax Changes and its impact post Upkeep 2018.
New Tax Changes and Impacts – Upkeep 2018
1. Cess on Income Tax hiked to 4%
As of last year, we were paying 3% health and education cess on all taxable income. This cess is now enhanced to 4%. This transpiration will increase your tax liability.
If you are from 20% slab your tax liability will increase by Rs.1125. Similarly, if you are from tax slab of 30% your tax liability will go up by Rs.2625. You can refer to image given unelevated for the numbering and impact.
2 Standard Deduction
In the upkeep 2018, it is proposed to provide a standard deduction of Rs.40000 from salary income to employees. These ways salaried people can enjoy tax-free income up to 2.9 Lakh. You might be thinking that Rs.40000 is a good value and it will require a lot of tax saving. However, your theorizing is wrong. Introduction of standard deduction will bring peanut type tax saving. If your taxable salary income is Rs.5 Lakh you will be worldly-wise to save only Rs.117 via this standard deduction
Download Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E From Financial Year 2000-01 to Financial Year 2018-19
3. Medical and Transport Wage Removed
Another big tax transpiration in the upkeep 2018 is the removal of medical and transport wage from the tax exemption. You may be enlightened that older salaried people were unable to requirement Rs.19200 towards transport and Rs.15000 towards medical reimbursement. So, total goody value was Rs.34200. In lieu of this amount, the new standard deduction of Rs.40000 is introduced.
4.LTCG @10 % on Stock Market and Bilateral Funds
LTCG tax on the stock market and bilateral fund investment in reintroduced in upkeep 2018.
• As per new rule any person who sells shares without April 1, 2018, will pay a long-term wanted gains tax at the rate of 10 percent on gains of increasingly than Rs 1 lakh. For such shares, the forfeit of vanquishment will be the price as on Jan. 31, 2018.
• If a person who has held shares for increasingly than one year sells them surpassing March 31, 2018, there will be no long-term wanted gains tax.
• No changes are made in short-term wanted proceeds tax. Short-term wanted proceeds would be taxed @15%.