Income Tax: Here are five rules that will come into effect from April 1 2021

Union Finance Minister Nirmala Sitharaman, while presenting Union Budget 2021 had announced a new simplified income tax regime to bring some relief to the salaried class. The income tax changes, that have an impact on the salaried class will come into effect from April 1, 2021.

According to the new rules, senior citizens of the age 75 and above with income from pension and interest from fixed deposit in the same bank would be exempted from filing ITR from April 1. Besides, the Finance Minister proposed higher TDS (tax deducted at source) for those who are not filing their ITR and announced to tax people contributing above ₹2.5 lakh annually to the EPF account.

EPF Contribution: Interest on employee contributions to provident fund over Rs 2.5 lakh per annum would be taxed from 1 April 2021. The move aimed at taxing high-value depositors in the Employee Provident Fund (EPF). Sitharaman said the EPF is aimed at the welfare of workers and any person earning less than Rs 2 lakh per month will not be affected by the proposal.

PF tax rules: Interest on annual employee contributions to provident fund over ₹2.5 lakh would be taxed from 1 April 2021. The govt said that the move is aimed at taxing high-value depositors in the Employee Provident Fund (EPF). Finance Minister Nirmala Sitharaman said the EPF is aimed at the welfare of workers and any person earning less than ₹2 lakh per month will not be affected by the proposal.

LTC Voucher: The Leave Travel Concession (LTC) cash Voucher scheme was announced by the central government in Budget 2021. The scheme was launched last year by the Modi-government to improve market demand and offer a tax advantage to individuals who were unableto seek the standard LTC tax credit due to travel constraints amid COVID-19.

TDS at a Higher Rate: A new section 206AB will be inserted in the Income Tax Act as a special provision providing for a higher rate for TDS for the non-filers of an income tax return.

Senior citizens above the age of 75 do not have to file a tax return: Individuals over 75 years old with pension income and interest from a fixed deposit in the same bank, as well as those with only interest income, do not have to submit ITR. The individual must only have pension income and all fixed deposit interest must be deposited in the same bank to take benefit of this rule.