28/11/2018

New Income Tax Rules for 2018-19: Know Tax Rebates & Standard Deductions Before Filing IT Returns

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Mumbai, November 28:  For the 2018-19 financial year, few changes were announced in the Union Budget for taxpayers. Individuals, earning between Rs 2.5 lacs to 5 lacs will have to pay 0-5 percent tax for different age groups while 20 percent tax will be applicable for individuals having an income of Rs 5 lacs to 10 lacs. ‘Due Date’ for Filing of Income Tax Returns & Reports of Audit Extended From 15 October 2018 to 31 October 2018.

In 2018-19 Budget, there were few announcements for salaried and pensioners, from introducing standard deduction of Rs 40,000 in lieu of medical reimbursement and transport allowance to penalising for late filing, the government brought in few changes. Income Tax Return (ITR) 2017-18 Filing: Last Day Today, Delay to Invite Heavy Penalty; Know How to File.

This year, the last date to file the Income Tax Returns was on August 31. On account of the devastating floods in Kerala, the last date for filing ITR was extended to September 15.

Following are some of the major changes that came into effect from April 1, 2018.

Medical, Transport Allowance Removed

The annual transport allowance of Rs 19,200 and medical reimbursement of 15,000 was removed as part of the salary structure.

Standard Deduction

A standard deduction of Rs 40,000 was introduced, for which, salaried taxpayers and pensioners don't require to furnish any bills or documents to claim the deduction.

No Change in Tax Slabs

There was no change in the tax slabs or rates for individual taxpayers. The income tax slabs were left unchanged. The cess on Income Tax was also increased from 3 percent to 4 percent

Some benefits For Senior Citizens

Among some of the benefits introduced for senior citizens were-increase in tax exemption limit for interest income from banks and post offices from Rs 10,000 to Rs 50,000 and increase in tax break on health insurance and medical expenditure under sections 80D and 80DDB.

Penalty on Late Filing

From April 1, the Income Tax Department imposed a penalty for late filing of Income Tax Returns. A penalty of Rs 5,000 was levied if the return is filed after the due date but before December 31 of that year and Rs 10,000 post-December 31.

It is to be noted that if you make a mistake while filing for FY2017-18, then you have time till March, 31 2019 to file your revised returns