Tuesday, March 15, 2011

DIRECT TAX PROPOSALS


  • The Direct Taxes Code 2010 (DTC) to be effective from 1 April 2012.
  • Increase in basic exemption limit
  • General basic exemption limit to be increased from Rs. 1.60 Lac to Rs. 1.80 Lac Basic exemption limit for senior citizens to be increased from Rs.2.40 Lac to Rs.2.50 Lac.
  • Relaxation for Senior Citizens
  • Qualifying age for senior citizens to be relaxed from 65 years to 60 years."
  • Introduction of New category " Very Senior Citizens " of 80 years and above.
  • New category of senior citizen to be eligible for higher basic exemption limit Rs.5,00,000.
  • The Surcharge for Domestic companies reduced to 5 % from 7.50 % and for foreign companies reduced from 2.50 % to 2 %.
  • MAT is proposed to be increased from 18% to 18.5%.
  • LLPs to be subject Alternate Minimum Tax @ 18.5%.
  • It is proposed to insert a new section 194 LB for deduction of tax at the rate of 5% by notified infrastructure debt funds on interest paid to non residents.
  • Scope of Investment Linked deduction u/s 35AD extended
  • Increase in monetary limit of business receipts u/s 2(15) from Rs.10 Lakhs to 25 Lakhs to qualify as a "Charitable Purpose
  • Salary earners having an income of less than Rs.5 lakh is exempted for filing income tax return from this year.
  • The additional deduction of Rs.20,000 u/s 80 CCF extended for one more year i.e. Assessment Year 2012-13.
  • NEW INCOME-TAX return form called Sugam to be introduced for small business.

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