The presumptive taxation scheme under section 44AD gives relief to small taxpayers having business income up to Rs. 2 Crores. If the cash receipts during the year falls within 5% of the total revenue, business having turnover up to Rs. 3 crore can opt for presumptive taxation. One of the key advantages of presumptive taxation is that you're not required to maintain books of accounts. Section 44AD allows taxpayers to calculate profit as a percentage of their turnover i.e., 6% & 8% depending on the nature of receipts.Taxpayers engaged in any business of plying, hiring, and leasing referred to in section 44AE are not eligible for presumptive taxation under section 44AD.

Futures and Options (F&O) trading in India offers immense opportunities for traders, but it also brings along complex tax implications that are often overlooked. Futures and Options (F&O) trading in India is classified as non-speculative business income. The advantage of this classification is that if you incur losses from F&O trading, you can set them off against other income, except income from salary, effectively reducing your overall tax liability which allows traders to minimise their tax burden. Understanding how to manage these losses and properly file your returns is crucial to ensuring that you maximise the benefits and comply with tax laws.If you are an F&O trader and find it challenging to comprehend the tax implications on your F&O trades, read on for a simplified and comprehensive explanation.Your Gains (Losses) from F&O Trades Must be Reported in ITRMany taxpayers engaged in F&O trading often overlook reporting their trading income in their tax returns. This is usually due to lack of awareness, but failing to declare all sources of income can lead to penalties.

Income tax refund arises when the tax you paid to government is more than what you are supposed to pay. Government collects taxes through TDS, advance tax at the time of filing the returns.Refund can be claimed at the time of filing the returns. Usually, the refund is processed within 4 to 5 weeks from the date of filing the returns. Read on to learn about the refund process, the usual time it takes, how to check your refund status, and what to do if it's taking longer than expected.What is Income Tax Refund?An Income Tax Refund is issued by the Income Tax Department if a taxpayer has paid more income tax than was due for the financial year.Normally, the tax is paid by the assessee at the time of filing returns after he assessess the tax liability by himself. This is the concept of Self-Assessment.But the actual tax liability and the tax amount paid may not be the same in all the cases due to a few factors.Income Tax Refund = Total Taxes paid – Total Tax Liability How does a Refund Situation Arise? Tax payment not only occurs at the time of filing the returns.

The new income tax slab rates under the new regime for the FY 2025-26 (AY 2026-27) are as follows: Rs. 0 to Rs. 4 lakh – Nil, Rs. 4 lakh to Rs. 8 lakh – 5%, Rs.

The Government of India provides some exemptions to reduce the tax burden on the taxpayers. Section 10 of the Income-tax Act, 1961 talks about those exemption provisions and the terms and conditions on which one can avail a tax exemption. These exemptions help the taxpayer to reduce their tax liability. Read this article to know more about the various exemptions available and how one can claim and benefit from them. What is Section 10 of the Income Tax Act?While calculating the tax liability of an individual, there are certain incomes which is exempt and do not form a part of the total income. Section 10 of the Income-tax Act 1961 includes all those exemptions that a taxpayer can claim while paying income tax. What are Exemptions Under Section 10?Here is a list of exempted income under Section 10:Section 10(1) - Agricultural IncomeThe following agricultural income exemptions are provided under Section 10(1) of the Income Tax Act:Sale of agricultural produceAgricultural operations such as sowing, cultivation, and tillingIncome from agricultural land in India, including rent or revenueEarnings from farm buildings used for agricultural purposesIncome from agricultural operations aimed at preservation and growth, such as weeding, pruning, and cuttingSection 10(2A) - Partner’s Share in Profits The partner’s share in the profits of the firm or Limited Liability Partnership(LLP) is fully exempt.Section 10(5) - Leave Travel AllowanceSection 10(5), or leave travel allowance exemption, is applicable for individual taxpayers. The LTA exemption applies only to the domestic travel expenses, such as airfare, train or bus fare, incurred by the employee.

Section 194-IB of the Income Tax Act deals with the tax deducted at source on rent payments which are not dealt under section 194I. Under this section, if the rent payment exceeds Rs.50,000 per month, TDS needs to be deducted at 2%. Section 194-IC was introduced to bring the ‘Joint development agreement’ of real estate under the purview of TDS. A joint development agreement is an agreement between the owner of the asset and the developer. Under section 194IC, TDS needs to be deducted at 10%.If you're paying rent exceeding Rs. 50,000 per month to your landlord, ensure that you deduct TDS on the rent payments as required under the Income Tax Act.Failure to do so may result in notices from the Income Tax Department and interest at 1% per month for late TDS deductions.You could also be treated as an assessee in default, which may lead to penalties in severe cases.What does Section 194-IB Specify?According to Section 194-IB, it is mandatory for any person, i.e.

Section 80C of the Income Tax Act provides exemptions or deductions on specific expenditures and investments from income tax. By investing in options like PPF, NSC, ELSS, SSY, etc., you can claim deductions of up to Rs. 1.5 lakh each year under Section 80C, helping you save on income tax. Let us understand these deductions in detail: Section 80C - Deductions and Exemptions on InvestmentsSection 80C is one of the most popular and favorite sections amongst taxpayers as it allows them to reduce taxable income by making tax-saving investments or incurring eligible expenses. Section 80C deduction can be claimed only by Individuals and HUFs.Companies, partnership firms and LLPs cannot avail the benefit of this deduction.Up to Rs.1.5 lakh can be claimed as a deduction every year from the Gross total income.Section 80C Deductions List Investment/PaymentDetailsEmployee Provident Fund (EPF)Contributions by employees to EPF are eligible for deduction.Public Provident Fund (PPF)Deposits to a PPF account (maximum limit ₹1.5 lakh per year).Life Insurance PremiumPremium paid for life insurance policies for self, spouse, or children.Equity-Linked Savings Scheme (ELSS)Investments in specified mutual funds with a 3-year lock-in period.National Savings Certificate (NSC)Investment in NSC qualifies for the deduction. Accrued interest (except for the last year) is also eligible.5-Year Fixed Deposit with BanksFixed deposits of 5 years or more with scheduled banks.Sukanya Samriddhi YojanaDeposits made for the benefit of a girl child.Principal Repayment of Home LoanThe principal portion of the EMI is paid for a home loan.Stamp Duty and Registration ChargesPaid for a residential property (allowed in the year of purchase).Tuition FeesPaid for the full-time education of up to two children in India.Senior Citizens Savings Scheme (SCSS)Investment made by senior citizens in SCSS.Unit Linked Insurance Plan (ULIP)Premium paid towards ULIP for self, spouse, and children.Post Office Time Deposit (5 years)Investment in 5-year time deposits at post offices.Superannuation fundEmployee's contribution to an approved superannuation fund.Pension PlansContribution to specific pension plans like LIC's Jeevan Suraksha, etc.For example, an individual could invest Rs.

Tax deducted at source (TDS) is a tax collection mechanism by the government wherein the payer responsible for making the payment must deduct tax from the amount paid to another person or entity. Section 195 of the Income-tax Act, 1961 specifies the TDS provision in the case of an individual making a payment other than salary to an NRI or a foreign company. Non-resident Indians (NRIs) also need to file their tax returns for the income earned in India. Similarly, they also can claim the tax deducted at source (TDS) when filing tax returns.Who is a Non-resident?A person is said to be a non-resident in India if he is not a resident in India, as laid out in section 6 of the Act.A person will be a resident of India in any financial year if they satisfy any of the following conditions: If they stay in India for 182 days or more during the financial year, ORIf they stay in India for 60 days or more during the financial year and 365 days or more during the immediately preceding four financial years.Exception for point (2)In the case of an Indian citizen or a person of Indian origin (PIO) whose total income, other than income from foreign sources:Exceeds Rs. 15 lakhs during the relevant financial year – 60 days, as mentioned in point (2) above will get substituted with 120 days.Indian citizen leaving India for employment outside -  The Indian citizen who leaves India in any year as a crew member or for employment outside India, the period of 60 days in point (2) above will be substituted with 182 days.Hence, an Indian citizen or PIO earning a total income over Rs 15 lakhs (other than from foreign sources) is deemed a resident in India if they are not taxed in any other country.Therefore, any person not satisfying any of the above conditions will be treated as a non-resident Indian. Who Should Deduct Tax Under Section 195?Any person who makes any payment (other than salary or interest referred to in sections 194LB, 194LC, and 194LD) that is taxable in India to a non-resident must deduct tax under this section. The payer, one who pays the NRI or remits the payment, can be a resident or a non-resident, an individual, Hindu Undivided Families (HUFs), partnership firms, other NRIs, foreign companies, or an artificial juridical person (for example, a corporation, government agency or non-profit organization).Is there a Threshold Limit to Deduct TDS u/s 195?No, there is no threshold limit to deduct TDS under Section 195. However, the payer must deduct tax only when the payment made to a non-resident is taxable in India.

Section 80EEA allows an additional deduction of up to Rs. 1.5 lakh per annum on home loan interest, over and above benefits under Sections 24 and 80C. It is available to individual, first-time homebuyers who do not own any other residential property at the time of loan sanction. The loan must be sanctioned between 1st April 2019 and 31st March 2022. The property's stamp duty value should not exceed Rs.

As a part of the campaign, Beti Bachao Beti Padhao, the Prime Minister, Narendra Modi, launched a scheme called ‘Sukanya Samridhi Yojana (SSY)’ for girl child. The objective of SSY is to meet the financial needs of girls in their higher education, marriage and other purposes. The SSY scheme offers an interest rate of 8.2% with a maturity period of 21 years. However, under certain conditions, the balance amount in the SSY can be withdrawn 5 years after the account has been opened. The account can be opened with a minimum amount of Rs.