Tax tasks you must complete in April itself

tax tasks you must complete in april itself

Sumary of Tax tasks you must complete in April itself:

  • On April 1, the Central Board of Direct Taxes (CBDT) notified all the income-tax related (ITR) forms for assessment year 2020-21..
  • “That because the tax rates and exemption and deductions that an individual can claim, are quite different in both of the tax regimes,”.
  • under the new tax regime, the exemption of section 10(14) are not allowed, except transport allowance to disabled employees..
  • Additionally- and under the new income-tax regime- deduction under sections part of Chapter VIA of the Income-tax Act that deal with investments and expenses (such as Section 80C) are not available..
  • Rana adds that deductions of Section 80CCD(2) (employer contributions made to the National Pension Scheme (NPS) on behalf of the employee) are allowed for deduction even under the new regime..
  • Naveen Wadhwa, DGM, Taxmann suggests that to decide which income-tax regime to select, salaried employees must compute their taxes twice, first under existing or the old tax regime (after claiming all exemptions and deductions) and second under the new tax regime without claiming exemptions and deductions..
  • “It best to do this in April itself, so that they can declare the preferred regime to the employer to deduct the tax accordingly,”.
  • Wadhwa reminds us that the CBDT has clarified that in the absence of this communication, the employer will assume that the employee wants to stick to the existing income-tax regime..
  • “Therefore, it is necessary for an employee intending to opt for a new tax regime, to tell this to his employer,”.
  • If you wish to stick to the existing income-tax regime, make a declaration of your investments and expenses that you intend to make during the current financial year, right away to your employer..
  • make declaration of investments you are planning in equity-linked tax saving mutual funds (ELSS), Public Provident Fund (PPF), National Savings Certificate (NSC), Sukanya Samriddhi Yojana (SSY),5-year tax – saving fixed deposits (FD) or term deposits in post offices;.
  • Similarly, expenses such children education fees, interest on home loan, education loan, electric vehicle loan, and house rent and so on qualify for deduction in different sections…

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