A new set of tax laws went into force today, April 1, 2022, with the start of the new financial year 2022-23. Here's a quick rundown of the tax changes that took effect on April 1st. -
Contributions to the EPF are taxed:
For all subsequent years, EPFO will keep distinct PF accounts for calculating taxable and non-taxable contributions by a person, one for contributions within the limit and the other for contributions beyond the limit, beginning in FY22.
The interest gained on the excess contribution is taxable if the employee's contribution to the EPF account exceeds Rs 2.5 lakh.
Virtual Assets and Cryptos will be Taxed:
Gains from virtual digital assets (VDAs) such as bitcoin, dogecoin, and other VDAs will be taxed at a fixed rate of 30%, beginning in FY 2022-23, as indicated in Budget 2022. Losses in one cryptocurrency would not be able to be offset by gains in another.
A 1% TDS would be applied to any sale of crypto assets, whether at a loss or profit. While gains in virtual assets will be taxed from April 1, provisions for a 1% TDS will take effect on July 1, 2022.
New & Updated ITR filing:
The Income-tax Act has been amended to include a new subsection 139 (8A). From April 1, 2022, taxpayers can file an updated return within 2 years from the end of the relevant assessment year.
While filing an updated ITR, an individual will be required to pay 25% to 50% as additional tax on the tax and interest due.
Employees in state government are subject to the NPS rule.
State government employees will be able to contribute and collect up to 14% of their base salary and dearness allowance under the National Pension System Scheme from April 1, 2022.
What will happen to accounts that do not comply with KYC requirements?
No one will be able to use their bank account if it does not comply with KYC requirements. Cash deposits, withdrawals, and other transactions will be restricted.
