Three Significant Changes in Tax Rules on PAN Aadhaar linking, TDS on crypto & Media
There are some important income tax laws are applicable since 1 July and we need to made it clear in our mind while filing Income Tax Return.
The union budget 2022 includes three significant changes in Income Tax Rules are from effect from 1 July. This recent modification should be known to every taxpayer.
TDS on cryptocurrencies
- A tax deducted at source (TDS) of @ 1% was proposed earlier this year by Finance Minister Nirmala Sitharaman for any payments made in exchange for the transfer of virtual digital assets (VDAs), Normally we known as cryptocurrencies and non-fungible tokens (NFTs) are known as virtual digital assets (VDAs). The TDS rule will take effect for transactions that amount more than Rs 10,000 on Friday, July 1.
- If the deductee's (the buyer's) PAN is not immediately available, the tax deducted at source (TDS) at the time of the transfer of virtual digital assets will be deducted at a rate of 20%. Furthermore, if the payer does not fall under one of the categories, tax deducted at source (TDS) will be withheld at a higher rate of 5% (as opposed to the standard rate of 1%) if the payer has not yet filed a tax return.
New TDS Rule for social media influencers & healthcare professionals.
- Medical professionals and social media influencers will be liable to a 10% tax deducted at source (TDS) on benefits they receive from businesses to advertise their goods with effect from July 1, 2022. According to a notice from the CBDT, the supplier of the benefit or perquisite may directly deduct the tax under Section 194R, however the taxpayer must confirm the recipient's ownership of any taxable funds.
- Section 194R states that tax must be deducted when a benefit or perk is supplied if the total value of those benefits or perk exceeds Rs. 20,000.
Note: perquisite/ Benefit should be arising from the exercise of a profession or business by healthcare professionals and social media influencers resident.
Penalty in case PAN Aadhaar is Non-Linking
- If the PAN-Aadhaar linking is completed on or after July 1, 2022, a fee of Rs 1,000 would be charged. Prior to June 30, the fee was 500 rupees. Therefore, in order to link a PAN and an Aadhaar, a person must first pay the fine and then seek to do so once the payment has been displayed in the e-filing portal.
Conclusion
- The Aadhaar & PAN linking, cryptocurrency investments, and the advantages received by the and social media influencers & medical professionals like Doctors, are the three major improvements.
- The late fine for Aadhaar & PAN linking has gone up, while doctors and Social media influencers will both be required to pay an additional 10% TDS on the profits they earn from sales promotions, under revisions made to Income Tax Rules. Investment made in cryptocurrencies will also be subject to a TDS at 1%.
- To combat black money, the government has imposed a number of restrictions on cash transactions. We should be aware of all the monetary transactions that could result to penalties.
