Budget 2017 and its impact on personal Tax Saving,Mutual funds,Real Estate & NPS
Changes proposed in personal income tax slab:
- Tax rate for individuals having income in the range of Rs.2.50,000 to 3,00,000 reduced from 10% to 5%.
- Rebate of Rs.5000 u/s 87A have reduced up to Rs.2500/-.This rebate will now available if taxable income is upto Rs.3,50,000.
- 10% Surcharge if annual taxable income is in between 50 L and 1 Crore.
- No change in surcharge of 15% on taxable income above Rs.1 Crore.
Changes proposed in Mutual funds:
No major changes have proposed for mutual funds except:
- RGESS – Rajiv Gandhi Equity Saving Scheme which was available for first time equity investors will be phased out.
- Provisions of LTCG -Long Term Capital Gains for equity remains as it is.
Changes proposed in NPS:
- Budget 2017 proposes tax exemption for partial withdrawal (up to 25% of contribution) made in specific cases.
Budget 2017 and its effect on Real Estate:
- LTCG has been tweaked for real estate.Holding period reduced up to 02 years from earlier 03 years to be eligible for long term capital gains.
- Individuals and HUFs paying rent of more than Rs.50,000 will need to deduct 5% tax at source.It can be done once in a year (from rent for last month of financial year).
