20 Recent Income Tax amendments Applicable for AY

20-21 & AY 21-22

taxguru.in/income-tax/20-income-tax-amendments-applicable-ay-20-21-ay-21-22.html

HARSHILSHETH

First, The Interim Union Budget for the year 2019 was presented by acting Finance
Minister Piyush Goyal on 1 February 2019. Whereas full Union Budget 2019 was
presented by Finance Minister, Nirmala Sitharaman on 5 July 2019. On 25
November,2019, the Taxation Laws (Amendment) Bill, 2019 (Bill) was introduced in the
Lok Sabha .The Union Budget 2020 was presented by the Finance Minister, Nirmala
Sitharaman on 1 February 2020, as her second budget. All these announcements
resulted into some drastic changes in Income tax.

Here is my humble attempt to summarise it in tabular format for your benefit. This will
take you to a quick tour to learn about recent changes & its applicability. I have noted
down 20 MOST important changes topic wise in just two pages that you
must take a look.

So, let’s take a look to 20 RECENT Amendments that has changed Income Tax
in a big way. Majorly applicable from AY 21-22 & SOME APPLCIABLE
FROM AY 20-21. Some changes are so drastic steps that this will change the
Income tax completely like option for New vs. old in personal taxation and
same way new rates for Corporate.

Item in red refers to changes applicable for AY 20-21 .

Sr Head Amendment Applicability

No
1/4
1
Business Motor cars acquired on or after 23rd August 2019 Only for AY
& but before 31st March 2020 is now depreciated at 2020-21
Profession 30% and the enhanced rate of Depreciation is 30%
for use of car other than hiring business only and
for hiring business it is @ 45%

2 Tax Audit Relaxation from Tax Audit upto 5 cr TO for those FROM AY
having TOTAL CASH EXPOSURE less than 5% of 2020-21
TOTAL receipts & payments . .

3 Tax Audit Date of filling of audited return -31-10 FROM AY

incl partners of firms having Tax Audit. And TAR 2020-21
upload by 30-9 (for AY 20-21 , the date of
uploading TAR is 31-10-2020 & date of filling of
TAR ITR is 30-11-2020)

4 House A person can claim two properties as self-occupied FROM AY

Property house properties subject to certain conditions. 2020-21
SO… its Annual value is NIL.
So Interest under section 24(b) to remain 2 lac
max. . Even if you claim 2 houses as Self
Occupied.

5 Capital BIG CHANGE – For indexation of property value, from AY

gain Stamp Duty Value of 01-04-2001 is to be 2021-22
considered. not FMV as on 01-04-2001

6 Capital Section 50C – now 10% Variation allowed for from AY

Gain Stamp Duty Value And Sale price. Earlier it was 5% 2021-22

7 Capital Section 54 – Assessee may buy 2 houses (earlier From AY

Gain one) When LTCG below 2 cr to save Tax on LTCG 2020-21
of House sold. This option available only once in a
lifetime.

8 Other BIG CHANGE – Dividend to be Taxable in hands of From AY

Source Shareholders ( earlier exempt) 2021-22

9 TDS / TDS over 5000 at 10% by company for the From 01-04-
TCS payment of Dividend 2020

2/4
10 Other 56(2)(X) Where any person receives any From AY
Source immovable property for inadequate consideration, 2021-22
the stamp duty value of such property as exceeds
such consideration, if difference is more than the
higher of the following amounts:
(i) the amount of fifty thousand rupees; and

(ii) the amount equal to 10% of the consideration

(earlier 5%)

The excess differential amount will be taxable in

the hands of receiver.

11 Personal Rebate 12500 instead 2500 till income 5 lac from AY

Taxation 2020-21

12 Personal BIG CHANGE – by introducing 115BAC From AY

Taxation Section 115BAC – 2021-22
Other than B&P income, Each year option for new
rate.
5 10 15 20 30 without claiming Deductions
exemption. for diff slabs
For B&P income , once chosen new rate option
then Lifetime , he must continue with new rates
unless until he doesn’t have B&P income .

13 Salary NPS+SAF+ PF anything in excess of 7.5 lac From AY

contributed by Employer will be taxable as 2021-22
perquisites in hands of employee

14 Salary Salary Standard deduction Rs 50000 (Earlier Rs From AY

40000) 2020-21

15 TDS / BIG CHANGE – TDS+TCS applicability for those from 01-04-

TCS who are crossing 1cr TO or 50lac receipts. (Earlier 2020
it was Audit wise).

16 TDS / TDS on cash withdrawal. By bank/post – 2% over 1 from 01-07-

TCS crore. 2020

17 TDS / BIG CHANGE – TCS @0.1% on SALE over 50 lac From 01-10-
TCS seller should collect TCS from buyer of total amt 2020
from sale in a year crossed 50 lac
Applicable to seller whose Turnover more than 10
crore

18 Return Mandatory Return filling for cash withdrawal, AY 2020-21

Filing Foreign travel exp, Electric bill consumption over
certain limit… irrespective of their Total income
being less/more than 2.5 lac

3/4
 19 Corporate BIG CHANGE. New regime for CORPORATE TAX. AY 2020-21
Taxation 115BAB and 115BAA
The corporate tax rates to 22% for existing
domestic companies and 15% for new domestic
manufacturing companies.

Co. cannot carry forward and set off their unutilised

MAT credit. Deductions/Exemptions not available
to Companies Opts for 115BAA or 115BAB.

20 Corporate BIG CHANGE – MAT at 15% (EARLIER 18.5%) AY 2020-21

Taxation

All TDS rates have been slashed by 25% such as TDS on dividend is 7.50%
instead of 10% for A Yr 20-21. This cut rate by 25% applicable only for the
period 14-5-2020 to 31-03-2021 on non-salaried classes of taxpayer.

NOTE – I have taken utmost care in writing these 20 amendments. If anything

important left, please feel free to contact me. ANY ERROR / MISTAKE / OMMISION,
Please contact me on 9879831157 or on my email ca.harshilsheth@gmail.com to help
me to rectify in it. Any constructive suggestion is welcome.

4/4