Option to choose from two tax regimes
The previous budget has introduced a new tax regime, where an individual tax payer has an option to opt for a lower tax rate (but with fewer deductions and exemptions) instead of the regular tax regime (with all deductions and exemptions available). This is the first year when this option will be exercised.
Salaried employees may choose between the two options on a yearly basis. In fact, even after opting for a particular option with their employer, they may opt for another option while filing their ITR. For assessee with business income however, new tax regime is a one way road. Once opted for the new tax regime, you cannot go back to old regime.
Less time for Belated or revised ITR
Before the amendment, an assessee failing to file ITR by the due date of 31st July could still file it by 31st March, with late fee. Similarly, any changes/revisions in the return could be made till 31st March of the same year.
With Finance Bill for 2021-22, this time limit has been reduced by three months and therefore till 31st December of the same financial year.
Dividend Income to be taxed
Dividend (from domestic companies and equity mutual fund) was tax free for majority of small investors as tax was paid by the company/mutual fund at the time of distribution of dividend. However, this exemption has been removed. Now, dividend income will also form a part of the taxable income.
Further, if the amount of dividend exceeds Rs. 5000, the company or mutual fund house would deduct TDS on the same. This TDS would also be reflected in Form No. 26AS.