Dearness Allowance (DA) is a salary component paid to employees of public sector undertakings to offset the impact of inflation and rising living costs. Calculated as a percentage of the basic salary, DA is revised twice a year based on the Consumer Price Index (CPI). It is fully taxable and varies depending on factors like basic pay and inflation rates.DA Raised by 2%The Dearness allowance has been increased to 60% from the existing limit of 58% for central government employees as approved by the Union Cabinet. This DA hike will take effect from 1st January, 2026. The purpose of DA hike is to offset the impact of inflation and rising living costs. The state governments of Tamil Nadu, Bihar, and Odisha have also raised the Dearness Allowance (DA) for their respective government employees and pensioners.What is Dearness Allowance?The government pays Dearness Allowance to its employees and pensioners as a cost of living adjustment to offset the impact of inflation.

An Income Tax Notice is an official communication from the Income Tax Department alerting a taxpayer to discrepancies, missing information, overdue filing, or unreported income. Notice can be issued to the taxpayer irrespective of whether returns are filed or not. It is important to understand the type of notice, primary issue involed, and the time limit for response to stay compliant and avoid adverse consequences.What is Income Tax Notice?An income tax notice is an official communication issued by the Income Tax Department to a taxpayer regarding discrepancies, non-compliance, or additional information required related to their Income Tax Return (ITR). Each notice is issued under a specific section of the Income Tax Act and requires timely action to avoid penalties or legal consequences. It may be sent for reasons such as:Non-filing of returns Mismatch in reported income Verification of claimsDemand for outstanding tax. Popular Notices issued under the Income Tax ActSection numberNoticeSection 142(1)Inquiry before assessmentSection 143(1)IntimationSection 143(2)Notice for scrutiny assessmentSection 148Income Escaping AssessmentSection 245Demand noticeHow to Verify or Authenticate Income Tax Notices?Before responding to any notice or order from the Income Tax Department, it is crucial to verify its authenticity. You can check whether the income tax notice is genuine by using the ‘Authenticate Notice/Order’ feature on the Income Tax e-filing portal.

Kisan Vikas Patra (KVP) is a government-backed savings scheme offered by India Post that allows investors to double their investment in 115 months (9 years and 5 months). It is a low-risk investment option designed to encourage long-term savings by offering guaranteed returns with annual compounding.Under the current rules, KVP offers an interest rate of 7.5% per annum, and the minimum investment starts from Rs.1,000 with no maximum limit. The scheme is suitable for conservative investors who want safe and predictable returns without exposure to market risks.Kisan Vikas Patra (KVP) - Key HighlightsGovernment-backed savings scheme that doubles your investment in 115 months (9 years 5 months).Current interest rate is 7.5% p.a., compounded annually (as per latest rates).Minimum investment is Rs.1,000 with no maximum limit on investment.Interest earned is taxable and no deduction is available under Section 80C.Available at post offices and selected banks with nomination and transfer facility.What is Kisan Vikas Patra?India Post introduced the Kisan Vikas Patra (KVP) as a small saving certificate scheme in 1988. The tenure for the scheme is now 115 months (9 years and 5 months).And if you invest a lump sum amount today, you can get double the amount at the end of the 115th month. Initially, it was meant for farmers to enable them to save for the long term, hence the name. Now it is available for all. The minimum investment amount is Rs.1,000, and there is no upper limit. To prevent the possibility of money laundering, the government in 2014 made PAN card proof compulsory for investments above Rs.50,000.

The Income Tax Department issues a demand notice under section 156 to taxpayers when they owe tax, interest, or penalty to the Income Tax Department. The intimation under section 143(1), issued by the Centralised Processing Centre (CPC), Bengaluru, is also considered a notice of demand when it demands the tax due from the taxpayer. Here, we are discussing the step-by-step guide on how taxpayers can respond to the demand notice from the Income Tax Department.What is a Demand Notice?Demand Notice under section 156 is the formal communication made by the Income Tax department to the taxpayer regarding the payment of taxes, interest or penalty due to the taxpayer. The payment has to be made within 30 days of the demand notice Types of (Deemed) Demand Notice under Section 156The different types of demand notices or deemed demand notices under section 156 are as follows:1. Intimation under Section 143(1)The intimation under section 143(1) is also considered a demand intimation under section 156.

Section 10(10D) of the Income Tax Act exempts any sum received under a life insurance policy, including bonuses, from income tax, provided the annual premium paid does not exceed 10% of the sum assured (for policies issued after 1 April 2012), 20% (for policies issued before 1 April 2012) or Rs. 5 lakh in any previous years . This applies to ULIPs, endowment policies, and traditional life insurance, subject to specific conditions.What is Section 10(10D)?Section 10(10D) of the Income Tax Act is a provision that exempts any sum received under a life insurance policy, including any bonus, upon maturity or surrender of the policy or as a death benefit from tax, subject to certain conditions regarding the premium paid in relation to the sum assured. This exemption applies to traditional life insurance policies, ULIPs, and endowment plans, ensuring tax-free proceeds if the specified conditions are met.Conditions for Exemption Under Section 10(10D)The following conditions need to be fulfilled to claim an exemption under Section 10(10D):Insurance Premium LimitThe annual premium for policies issued after 1st April 2012 should not exceed 10% of the actual sum assured. Policies issued between 1st April 2003 and 31st March 2012, the annual premium should not exceed 20% of the actual sum assured. Policies (other than ULIPs) issued after 1st April 2023, the maturity amount is exempt only if the annual premium paid in any of the previous year does not exceed Rs. 5 lakh. This shall not be applicable for the sum received on the death of the person.Policy TypeThis is applicable for ULIPs, endowment plans, money-back policies, and term insurance with maturity benefits. However, for ULPIs issued after 1st February 2021, exemption under Section 10(10D) will be available if the premium paid in any of the previous years does not exceed Rs.

The new Income Tax Act 2025 was introduced to modernise the tax laws that had become complex after decades of amendments. The new act reorganises provisions into 536 sections across 23 chapters, making it easier for taxpayers, businesses, and tax professionals to understand and comply with tax rules.Income Tax Act 2025 - At a GlanceThe Income Tax Act, 2025 will replace the Income Tax Act, 1961 from 1 April 2026.The new act reorganises income tax provisions into 23 simplified chapters.Tax slabs and core tax principles largely remain unchanged.The objective is to simplify tax laws and improve compliance for taxpayers.What is the Income Tax Act 2025?The Income Tax Act 2025 is a comprehensive legislation governing the levy, administration, collection, and recovery of direct taxes in India. The new tax provision aims to bring an income tax reform by simplifying income tax laws.The new act aims at simplification of tax laws, making it easier to understand, interpret and comply with. Easy, more automated and user friendly compliance is expected to reduce the instances of non-compliance and tax avoidance techniques.Why Was the Income Tax Act 2025 Introduced?The Income Tax Act 1961 had become extremely complex after hundreds of amendments over decades. Many provisions were outdates, repetitive, scattered, or were in language difficult for taxpayers to interpret. The Income Tax Act 2025 was introduced to address these issues with the following objectives:Simplify the tax lawReduce litigationImprove complianceModernise tax administrationNew Income Tax Act 2025 PDF DownloadYou can download the Income Tax Act pdf from the Income Tax Department website, that will be effective from 1st April 2026.When Does the Income Tax Act 2025 Come Into Effect?The new Income Tax Act 2025 comes into effect from 1st April 2026 completely replacing the existing Income Tax Act 1961.

The income tax laws in India is governed by the Income Tax Act, 1961. The act contains provisions related to income calculations, exemptions, deductions, and tax rates. With effect from 1st April 2026, the Income Tax Act of 1961 will be replaced by the Income Tax Act 2025. However for the current tax season (April to August 2026), Income Tax Act 1961 needs to be referred as the act is applicable to income earned up to 31st March 2026.Key HighlightsThe new Income Tax Act, 2025, will come into effect from 1st April 2026, eliminating redundant provisions and aligning the law with current technological and economic developments.It contains 931 sections, higher as compared to the new Income Tax Act, 2025.The Act provides various deductions and exemptions, applicable separately under the old and new tax regimes.What is the Income Tax Act 1961?The Income Tax Act 1961 governs the levy, collection, and administration of direct taxes in India. It applies to all persons earning income in India, regardless of whether they are citizens or not. It contains provisions related to types of income, how to tax different kinds of income, tax benefits, exemptions, tax rates, due dates, penal provisions, etc.This act is applicable to the whole of IndiaPresent day, it contains more than 931 sections, 23 chapters, and 14 schedulesEvery year, the parliament passes Annual Finance Act, thereby amending the act to cater the requirements of changing economic situation.Income Tax Bare Act - PDF DownloadDownload Income Tax Act, as amended by the Finance Act 2025.Features of Income Tax Act 1961Some of the salient features of the Income Tax Act 1961 are as follows:Income tax is a form of direct tax that needs to be borne by the taxpayer.

Section 54 of the Income Tax Act, allows taxpayers to claim an exemption from Long-term Capital Gains arising from sale of residential house property, when such gains are reinvested in another residential property. The taxpayer must purchase a new residential house within 2 years or construct a new house within 3 years from date of sale. However, the maximum allowed exemption limit is capped at Rs. 10 Crore. Overview of Section 54 ExemptionAspectDetailsWho can claimIndividuals and HUFs onlyCapital gains typeLong-term capital gains from sale of residential house propertyExemption limitRs. 10 CroreTax regimeAvailable under both old and new tax regimesWhat is Section 54?Section 54 provides an exemption from long-term capital gains tax when an individual sells a house and purchases another house using the capital gains.

Pension is taxable under the head Income From Salaries. Pensions are paid out periodically, generally every month. However, the taxpayer may also choose to receive the pension as a lump sum (also called commuted pension) instead of a monthly payment. In case of a commuted pension, the taxpayer will have the option of claiming an exemption under section 10 of the Income Tax Act, 1961.  Commuted and Uncommuted PensionGenerally, the employer and taxpayer contribute together to an annuity fund, which pays the taxpayer pension out of the fund.

Gold is often viewed as an attractive and safe investment option for investors due to its capital appreciation, thus attracting high demand. Investors now have various option to invest in Gold through Gold ETFs, Gold Mutual Funds, physical jewellery and bullion, digital gold, etc. However, any capital gains arising at the time of sale of gold will be subject to tax based on the holding period of the asset. Long-term capital gains on gold is taxed at 12.5% whereas short-term capital gains ares taxed at applicable income tax slab rates.Tax on Gold Investments- An OverviewThe following table shows tax rates and holding period differences for different forms of gold:Form of GoldHolding Period for STCGSTCG Tax RateHolding Period for LTCGLTCG Tax RatePhysical Gold (bars, coins, jewellery, digital gold)≤ 24 monthsNormal slab rates> 24 months12.5%Gold ETF≤ 12 monthsNormal slab rates> 12 months12.5%Gold Mutual Funds ≤ 24 monthsNormal slab rates> 24 months12.5%Sovereign Gold Bonds (SGB) -originally subscribed and held till maturity (8 years)-ExemptExemptExemptSGB sold (other than above)≤ 12 monthsNormal slab rates> 12 months12.5%What is Digital Gold?The concept of digital gold is not different from that of physical gold.The only difference is that you can buy them online and the issuer will store them in vaults on your behalf. Moreover, government bodies like RBI or SEBI have no authority to regulate this investment type.Income Tax on Digital Gold in IndiaSale of digital gold attracts taxes as per the income tax rules for gold purchases. Returns from gold held for 24 months or more are termed long-term capital gains; returns from gold that are held for less than this period are termed short-term capital gains (STCG).The tax on the sale of digital gold will attract the same as physical gold and paper gold. LTCG on gold attracts 12.5% of tax with applicable cess. In the case of STCG, the tax is charged as per your income slab.Taxes on Physical Gold PurchaseThe physical form of gold includes jewellery, gold biscuits, gold ornaments, gold coins, etc. For ages, the physical form of gold has been a popular investment option in India. However, according to the Income Tax Act of India, you need to pay a 12.5% tax on long-term capital gains (LTCG) while selling gold. However, this rate is not applicable for short-term capital gains.