The following are the important changes under Central and State Tax Laws with effect from 1st April 2015
- Conveyance Allowance – Transport allowance (popularly known as conveyance allowance) granted to an employee to meet his expenditure for the purpose of commuting between the place of his residence and the place of his duty is exempted upto Rs.800 per month. The limit of exemption is now enhanced to Rs.1600 per month. (Suggestion – make changes in the salary structure of the employees accordingly)
- Profession Tax – Those whose salary for a month was more than Rs.10,000/- were supposed to pay Profession Tax of Rs.150 per month. Now, from 1st April, 2015, the persons drawing salary upto Rs.15,000 per month are exempted from Profession Tax. (Suggestion – make note of this change and calculate the taxes accordingly)
- Profession Tax exemption for senior citizens who have attained age of 60 Years (Suggestion – make note of this information and compute the taxes accordingly)
- Wealth Tax – Is abolished from 1st April 2015. (Suggestion – wealth tax is payable for the Financial Year ending 31st March 2015. Keep all the wealth tax papers of past 8 years in safe custody even though wealth tax is abolished from FY 2015-16)
- Mediclaim Insurance – Keeping into account the rising cost of Medical expenses, the premium paid towards mediclaiim insurance is enhanced from Rs.15,000 to Rs.25,000 per year u/s 80D. ( Suggestion – Don’t forget to submit the proof of premium payment to your employer/while filing IT return and avail the enhanced tax benefits)
- Basic Exemption Limit for VAT registration in Karnataka – Now the traders who expect to do annual taxable turnover (sales) of less than Rs.10 Lakhs needn’t register under Karnataka VAT Laws. However other aspects of registration which were applicable till March 2015, will continue to apply.
- Reverse Charge Method under service Tax Laws w.r.t Manpower Consultancy – Currently in case manpower supply or security services is provided by individual, HUF or partnership firm to a body or a corporate, the service provider is liable to deposit Service Tax to the extent of 25% and service receiver liable to deposit Service Tax to extent of 75%. W.e.f 1st April 2015 Service Tax is not required to be charged by specified service provider (i.e., individuals, HUF, Partnership Firms) and the same is to be paid by the service receiver entirely (i.e, instead of 75%, the service receiver has to pay 100%)
Thought for the day
Be patient. Things will change for the better.