Before Budget 2019

• There was dividend distribution tax (@ 20.56%) on dividend by the Companies and also tax @ 10% in the hands of shareholders on dividends in case dividends amounts to more than Rs 10 lakh.
• In respect of Buy back of shares, there was no tax on buy back for companies and for investors only long term capital gain tax @10 was applicable.

Reason for introduction of Buy back tax

Considering the above loop hole, companies were preferring for Buy back instead of Dividend. To plug this gap, Finance Minister Nirmala Sitharaman introduced an additional tax of 20 per cent on buyback of equity shares by listed companies

1. Threshold for applicability of lower corporate tax rate of 25% increased from Rs 250 crore to Rs 400 crore.

2. Enhanced interest deduction up to Rs 5 lakh for purchase of an affordable house.

3. New Section 80EEB so as to provide for deduction up to Rs. 1.5 lakh to an Individual assessee in respect of interest on loan taken for purchase of an electric vehicle

4. TDS of 2% on cash withdrawal exceeding 1 crore in a year from a bank account to promote less cash economy.

5. No charges or MDR on specified digital mode of payments. These modes are to be compulsorily provided by large businesses.

6. Sabka Vishwas Legacy Dispute Resolution Scheme proposed for quick closure of service tax and excise related litigations.

7. Higher surcharge @25% on tax is proposed where taxable income of Individual, HUF, AOP and BOI is between Rs   2   to   5      Taxable   Income exceeding Rs 5 Crores to attract surcharge @ 37%. Maximum Surcharge at present was 15% of tax where income exceeds Rs 1 crore. Effective tax rate for Individual, HUF, AOP and BOI having taxable income between Rs 2 to 5 crores is increased from 35.88% to 39% and income exceeding Rs 5 crores from 35.88% to 42.74%.  Refer Annexure A1.

8. Buy back of shares from a shareholder by a listed company, on or after 5th July 2019, shall be covered under provisions of  Section  115QA  and  will  attract  tax @20% in the hands of the listed company and consequentially  amount  received  by  shareholder will be exempt under Section 10(34A).

9. Deposit taking and systemically important non-deposit taking NBFCs can now pay tax in the year they receive interest for certain bad or doubtful debts.

Others

10. Those who do not have PAN will be allowed to file income tax returns on the basis of Aadhaar number. Aadhaar can be quoted wherever PAN is required.

11. For the benefit of distressed companies, it is also proposed to amend section 115JB to provide that for calculating book profit, the aggregate amount of brought forward unabsorbed depreciation and loss (excluding depreciation) shall also be allowed to be reduced. The said amendments are proposed to be effective from AY 2020-21.

12. The target is  for  India to be a 5 trillion  dollar economy in 5 years

1. No tax on taxable income upto 5 lakh 

Individual taxpayers with annual income up to 5 lakh rupees to get full tax rebate. Individuals with gross income up to 6.5 lakh rupees will not need to pay any tax if they make investments in provident funds and prescribed equities. Around 3 crore middle class taxpayers will get tax exemption due to this.

2. Standard tax deduction for salaried persons raised from 40,000 rupees to 50,000 rupees

3. TDS threshold on interest on bank and post office deposits raised from 10,000 to 40,000 rupees.

4.TDS threshold on rental income raised from 1.8 lakh to 2.4 lakh rupees.

5. Benefit of rollover of capital tax gains to be increased from investment in one residential house to that two residential houses, for a taxpayer having capital gains up to 2 crore rupees; can be exercised once in a lifetime.

6. Exemption from tax on second self-occupied house

7. Within 2 years, Tax assessment will be done electronically

8. Minimum 14% revenue of GST to states by Central Govt.

8. Recommendations to GST council for reducing GST rates for home buyers

9. Exempt on tax on second self-occupied house

Other

10. Proposal to launch “Pradhan Mantri Kisan Samman Nidhi” (PM-KISAN) whereby  landholding  farmer having cultivable land upto 2 hectares will be provided direct income support at the rate of INR 6,000 per year with an annual expenditure of INR 75,000 crore which will be funded by the Government.  

11. Farmers affected by severe natural calamities (where assistance has been provided by National Disaster Relief Fund) shall be provided benefit of interest subvention of 2% and additional interest subvention of 3% as prompt repayment initiative for  entire  period  of  reschedule  of loan.

12. Tax free Gratuity limit increase to 20 Lakhs from 10 Lakhs

13.For the purpose of providing comprehensive social security coverage  for   old  age  of   unorganized  sector  workers earning monthly income upto INR 15,000, Government has proposed the launch of “Pradhan Mantri Shram-Yogi Maandhan” which shall provide said workers with assured monthly pension of INR 3,000 per month from the age of 60 years on small monthly contribution ranging from INR 55-100.

1. Short title and commencement.-

(1) This Order may be called the Specified Companies (Furnishing of information about payment to micro and small enterprise suppliers) Order, 2019.

(2) lt shall come into force from the date of its publication in the Official Gazette.

2. Every specified company shall file in MSME Form I details of all outstanding dues to Micro or small enterprises suppliers existing on the date of notification of this order within thirty days from the date of publication of this notification.
3. Every specified company shall file a return as per MSME Form I annexed to this Order, by 31st October for the period from April to September and by 30th April for the period from October to March.

For details and form, refer link http://www.mca.gov.in/Ministry/pdf/MSMESpecifiedCompanies_22012019.pdf

The Guidance Note was revised by AASB in 2016 based on the provisions of the Companies Act 2013 and the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009. In September 2018, SEBI revised the earlier regulations and issued the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 wherein number of changes vis-à-vis ICDR Regulations 2009 have been made.

Considering the numerous changes made by SEBI(ICDR) Regulations 2018, AASB of ICAI has brought out the revised edition of the ‘Guidance Note on Reports in Company Prospectuses’ to provide appropriate guidance to the members.

For details, https://resource.cdn.icai.org/53704aasb43145a.pdf

2. Relaxation In Filing Of Return By Composition Dealer-
Only one Annual Return but Payment of Taxes would remain Quarterly (along with a simple declaration).

3. Higher Exemption Threshold Limit for Supplier of Goods:
Two Threshold Limits for exemption from Registration and Payment of GST for the suppliers of Goods i.e. Rs 40 lakhs and Rs 20 lakhs. States would have an option to decide about one of the limits within a weeks’ time. The Threshold for Registration for Service Providers would continue to be Rs 20 lakhs and in case of Special Category States at Rs 10 lakhs.

4. Composition Scheme for Services:
A Composition Scheme shall be made available for Suppliers of Services (or Mixed Suppliers) with a Tax Rate of 6% (3% CGST +3% SGST) having an Annual Turnover in the preceding Financial Year up to Rs 50 lakhs. The said Scheme Shall be applicable to both Service Providers as well as Suppliers of Goods and Services, who are not eligible for the presently available Composition Scheme for Goods. They would be liable to file one Annual Return with Quarterly Payment of Taxes (along with a Simple Declaration).

Note:
1. This changes are effective w.e.f. 01/04/2019
2. We have provided this summary for information purpose of general public.Users are requested to verify the correctness of information given above with government notification. Business Buddies and/or its employees were not responsible for loss arising to anyone.

Allergies, Asthma, Bronchitis, Lungs Cancer and other long term illnesses. Cost of recovering from these illnesses are increasing day by day. Think for a moment about the impact of all this on your family.

While your near and dear ones can provide the care and love in such a difficult time, when it comes to financing your healthcare costs, you know the reality best. Thankfully, certain risks can be transferred to others and healthcare expenses are one such risk. Transfer these risks to the insurance companies and live peacefully.

But what is the best healthcare plan for me…? Who can provide me with the right advice without any vested interest…? What will I do in case of claim situation…?

If these questions bother you and you want to know more about how we can help you, we are just a call away to understand your needs and give you the best solution.

BUSINESS BUDDIES – ONE STOP SOLUTION FOR ALL PROFESSIONAL NEEDS