New tax slabs to LPG prices: List of changes from April 1

From revised income tax slabs to gold jewellery hallmark, here is a list of major changes effective from this month.

April is an important month from a financial perspective as several new rules kick in for taxpayers. Apart from new tax slabs and changes in savings scheme benefits, here are the major changes that will be effective from the new financial year:

The new financial year (FY) 2023-24 will begin on April 1. (representative)

1. The new income tax regime will become the default tax regime for salaried individuals who do not declare their choice. Others can still opt for the old one if needed.
2. For non-government staff, the encashment limit for leave travel allowance has been increased to ₹25 lakh from ₹3 lakh, which has been the limit since 2002.
3. PAN will be deactivated if it’s not linked to Aadhaar by March 31, 2023. A fine of ₹10,000 will have to be paid to activate it again.
4. Equity trading on National Stock Exchange’s cash and derivatives segment will become cheaper as the 6 per cent transaction fee will be withdrawn.
5. Life and non-life insurers will have more flexibility in managing expenses as the Insurance Regulatory and Development Authority of India (IRDAI) has replaced the individual cap on commission payments with an overall cap on expenses of management of insurers.
6. Debt mutual funds with less than 35 per cent investment in equity shares of Indian companies will be taxed as short-term capital gains, stripping investors of long-term tax benefits. Investment in Market Linked Debentures (MLDs) will now be short term capital assets, which will have a ‘slightly negative’ effect on the mutual fund industry, as per experts.
7. Life insurance policies, except Unit Linked Insurance Plan (ULIP), with annual premium exceeding ₹5 lakh would be taxable.
8. The maximum deposit limit under senior citizens savings scheme will be increased to ₹30 lakh from ₹15 lakh, to ₹9 lakh from ₹4.5 lakh and to ₹15 lakh from ₹7.5 lakh for monthly income scheme (single and joint accounts respectively).
9. The turnover limits under section 44AD has been increased from ₹2 crore to ₹3 crore for particular businesses, including Micro, Small, and Medium Enterprises (MSMEs). Under Section 44AD, the presumptive taxation limits of gross receipts has been revised from ₹50 Lakhs to ₹75 Lakhs for certain jobs.
10. Only gold jewellery hallmarked with a six-digit alphanumeric HUID (Hallmark Unique Identification) will be allowed for sale from April 1. Also, there will be no capital gain tax if physical gold is converted to an Electronic Gold Receipt (EGR) and vice versa.
11. Winning proceeds from online gaming would be subject to Tax Deducted at Source (TDS) of 30% TDS. Currently, it is levied on winnings over Rs. 10,000/
12. A stricter implementation of BS-VI phase II emission norms will lead to a spike in automobile prices due to the input cost inflation.
13. The price of LPG cylinders may likely increase as petroleum companies revise the rates on the first day of the new financial year.