Every year the end of March and the beginning of April brings a lot of headaches from a financial point of view. In this short period of time, the financial year changes, and a new annual budget is announced and implemented from April 1st. Due to this implementation process, major changes occur in existing Income Tax rules forced by the IT Department in India. And every earning individual who is not aware of such changes can face major consequences.
List of Major Changes in Income Tax Rules Applicable from April 1, 2023
1. Introducing New Tax Slabs
With Budget 2023, FM Nirmala Sitharaman has introduced new tax slabs under a new tax regime, according to which the Government will levy taxes on the citizens.
Here are the new tax slabs:
- ₹0-3 Lakhs- Nil
- ₹3-6 Lakhs- 5%
- ₹6-9 Lakhs- 10%
- ₹9-12 Lakhs- 15%
- ₹12-15 Lakhs- 20%
- And above ₹15 Lakhs- 30%
2. Introduced Stand Deductions
With the new tax slab, standard deductions of up to ₹50,000 for salaried taxpayers are introduced and are in effect from April 1, 2023. This standard deduction amount is applicable for those employees who are earning ₹15.5 lakhs or more in a financial year.
3. Surcharge Reduced
Under the new tax regime, the surcharge is reduced from 35% to 25% for individuals earning ₹5 Cr or more in a financial year.
4. TDS Made Applicable on Online Gaming
With the new budget in 2023, the earnings generated from online gaming and related platforms will attract TDS. This new financial change has been in effect since April 1, 2023.
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5. LCTG and Indexation Benefits Revoked on Debt Funds
So the investments made towards mutual funds where only 35 per cent, and not more than that, is invested in equity shares of an India company will only offer short-term capital gains. The benefit of LCTG or long-term capital gains is revoked.
