The following are the Key Highlights from the Union Budget 2021, as presented by the Hon’ble Finance Minister of India, Nirmala Sitharaman
- Citizens of age 75 years and above who have only Pension and Interest income – Need not file Income Tax Returns
- Re-opening of Assessment to reduced to 3 years from 6 years. Only where evidence of concealment of Income of Rs. 50 lakhs or more – re-opening can be made upto 10 years & only with approval of Pr.CCIT.
- Reducing Litigation for small tax payers – Constitution of Faceless Dispute Resolution Panel for people with Total Income upto Rs.50 lakh and disputed income of Rs.10 lakh
- Income Tax Appellate Tribunal to become Faceless – Only electronic communication will be done
- Relaxation to NRIs – Rules to remove hardship of Double Taxation
- Vivad Se Viswas Scheme Last Date of filing extended to 28th February, 2021.
- Tax Audit Limit to be increased to Rs.10 crores from Rs.5 crores for those having less than 5% cash transactions
- Dividend Tax- Dividend will be exempt from TDS. Advance tax liability on dividend income will arise only after declaration or payment of dividend. For Foreign Investors – lower treaty rate benefit will be given.
- Affordable Housing – Additional Interest deduction (Sec 80EEA) of Rs.1.5 lakhs to be extended for loans taken till 31st March, 2022.
- Affordable Housing Projects – Tax Holiday extended till 31st March, 2022.
- Tax Holiday for Capital Gains for Aircraft Leasing Companies and Tax Exemption to Lease paid to Foreign Persons
- Pre-Filling of Returns – Details of Capital Gains, Dividend Income and Interest income will be pre-filled in the returns
- Relief to Trusts – Charitable trusts running Hospitals and Educational Institutions relief increased from Rs.1 crore to Rs.5 crore.
- Employee contribution not paid by employer will not be allowed as a deduction.
- Tax holiday for Start-Ups extended to 31st March, 2022. Capital Gains exemption on investment in start ups also extended to 31s March, 2022.
MCA, Companies Act, LLP Act
- Easing Compliance requirements of Small Companies – Threshold increased to Share Capital upto Rs.2 crore and Turnover upto Rs.20 crore will be Small Companies
- Allow One Person Companies (OPC) to grow without any restriction in Share Capital or Turnover. NRIs will be allowed to set-up OPCs. Presence in India of 120 days in a year enough to start an OPC.
- Launching MCA Version 3.0 – E-Scrutiny, E-Adjudication and Compliance management to be simplified.
- Decriminalisation of LLP Act, 2008
- Tribunals to be rationalised