Points Worth Noting after the Introductions of Finance Bill, 2021 (Part 1):
Introduction : There are several amendments which has been introduced through Finance Bill, 2021; and therefore, every professional and assessee shall know this amendment. In this article we will discuss important amendments introduced through finance bill, 2021.
Important points after Finance Bill, 2021:
- After the amendment of under section 44ADA, i.e., professionals who are paying tax on presumptive basis, in that it has been clarified that Limited Liability Partnership will not be allowed to opt for such scheme.
- Amendment has been made under section 11, that if any corpus donation has been received by any charitable or religious trust the same shall not be treated as application of Income until and unless the said has been deposited under the various modes specified under section 11(5). Therefore, if trust wants to treat any corpus as application of Income than in that case such shall be deposited in modes or forms specified under section 11(5) of Income Tax Act, 1961; if in case partial amount is deposited than trust will get deduction only to the extent of such partial amount.
- Increase in limit of Audit under section of 44AB; it has been specified that if assessee is having turnover up to Rs. 10 Crore and having cash receipt and payment up to specified amount than in such case person will not be liable to tax audit.
- No change has been made in basic exemption limit of slab of rates for Individual.
- Deduction under section 54GB on Income Tax Act, 1961 will be allowed till 31st March, 2022.
- Insertion of section 194P of Income Tax, 1961: Specified Senior Citizen will not be required to file Income tax return, however on any Income paid by specified bank (Banking Company as notified by Central Government) than TDS shall be deducted from such Income at the applicable rate (However, while computing tax on such Income, if applicable than deduction under chapter IV-A and rebate under section 87A shall be deducted).
- For the above purpose specified senior citizen means Individual and Resident in India and
(i) who is of the age of seventy-fiveyears or more at any time during the previous year;
(ii) who is having income of the nature of pension and no other income except the income of the nature of interest received or receivable from any account maintained by such individual in the same specified bank in which he is receiving his pension income; and
(iii) has furnished a declaration to the specified bank containing such particulars, in such form and verified in such manner, as may be prescribed.
Further definition of small company is changed and as per new definition under companies act, 2013;
If entity is having paid-up share capital up to Rs. 2 Crore and having Turnover up to Rs. 20 Crore and having. It shall be noted that all the other part or definition has been kept unchanged.
Along with this there are insertion of some sections and amendments which are worth noting and which will be covered in Part-2.