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<ul><li><keyword id="6355261" type="UNKNOWN" weightage="20" keywordseo="finance-minister">Finance Minister</keyword> <keyword id="129243" type="PERSON" weightage="20" keywordseo="Nirmala-Sitharaman">Nirmala Sitharaman</keyword> announced a reduction in Employees’ Provident Fund (<keyword id="45027" type="ORGANIZATION" weightage="20" keywordseo="EPF">EPF</keyword>) from 12% to 10% for the next three months. </li><li>This will directly impact nearly 4.3 crore employees as their take-home salaries will increase. </li><li>For employees, even though cash-in-hand may increase — it will be taxed. This will, in turn, help the government with tax revenues.</li></ul>Finance Minister Nirmala Sitharaman announced a <keyword id="9219405" type="UNKNOWN" weightage="20" keywordseo="reduction-in-employee-provident-fund">reduction in Employee Provident Fund</keyword> (EPF) contributions for the next three months. While take-home salaries will increase, the additional amount received will be taxable as per existing slabs. If the same money were to be left in the EPF, and withdrawn at the time of retirement, you wouldn’t have to pay tax on it. How much will my take-home increase due to the EPF deduction? Earlier, 24% of the net pay was going into EPF. And, now 20% will go — 10% from employers, 10% from the employee. The employer may choose to continue with the old contribution but it is less likely. For instance, an employee with basic pay of ₹100,000, the amount deposited into EPF will fall ₹4,000. So you will get ₹4,000 more as take-home salary and that will be taxed at ₹1,200 per month (assuming you fall under 30% tax slab). The annual tax paid will be ₹14,400. Similarly, those with basic pay of ₹50,000, the reduction will amount to ₹2,000 per month. The monthly tax increase will be ₹200 a month (assuming a tax rate of 10%). The tax increase for the entire year will be ₹2,400. How is the government making money by reducing my EPF? The government will make money on two counts, and the additional tax is only one of them. “These measures reduce the interest burden for the government,” said Archit Gupta, Founder and CEO of ClearTax. That is because there will be less money deposited into EPF after this announcement. As the Finance Minister pointed out on May 13, she expects nearly 4.3 crore employees to avail the <keyword id="9218131" type="UNKNOWN" weightage="20" keywordseo="EPF-reduction">EPF reduction</keyword> and increase the take-home salary. The sum of all these reductions can be a significant benefit for the government. What the government loses in this process is the opportunity to invest more EPF money in assets like equities or bonds for higher returns. “They have very limited equity exposure. So, they’re not able to afford the kind of returns that they’ve been giving,” Gupta said. The uncertainty in the post COVID-19 economy has reduced the investment opportunities further. See also: <a href="https://www.businessinsider.in/personal-finance/news/epf-provident-fund-deduction-cut-to-boost-take-home-salaries/articleshow/75718392.cms">Take-home salaries for employees will increase as Finance Minister Nirmala Sitharaman reduces provident fund deduction</a> <a href="https://www.businessinsider.in/personal-finance/news/finance-minister-nirmala-sitharaman-sets-june-30-deadline-for-tax-saving-investments/articleshow/75731021.cms">Reminder⁠ — You have time till June 30 to make tax-saving investments for the last financial year</a>

The EPF reduction means you will pay tax on cash from your retirement fund

<ul><li>As businesses begin to get back to work, the FM announced reduction in Employees' <keyword id="45028" type="ORGANIZATION" weightage="20" keywordseo="Provident-Fund">Provident Fund</keyword>. </li><li>This means that the <keyword id="1481502" type="PERSON" weightage="20" keywordseo="take-home-salary">take home salary</keyword> of employees will go up. </li><li>The statutory PF contribution is being reduced to 10% from 12%</li></ul>The coronavirus pandemic has hit businesses across sectors in India and today, <keyword id="6355261" type="UNKNOWN" weightage="20" keywordseo="finance-minister">Finance Minister</keyword> (FM) <keyword id="129243" type="PERSON" weightage="20" keywordseo="Nirmala-Sitharaman">Nirmala Sitharaman</keyword> announced a set of relief measures for the industries. As businesses begin to get back to work, the FM announced reduction in Employees' Provident Fund (<keyword id="45027" type="ORGANIZATION" weightage="20" keywordseo="EPF">EPF</keyword>). This means that the take home salary of employees will go up. “The statutory PF contribution is being reduced to 10% from 12% so that employers will have some more money in their hands. However, for PSUs we will continue to pay the 12%,” she said. <div type="Article" hostid="261" msid="75717906" title="Deadlines for tax returns deferred⁠— and other tax reliefs announced by Nirmala Sithraman" mstype="2" mssubtype="0"></div> Sitharaman said that the EPF contribution will be paid by the government of India and 72.22 lakh employees will benefit from it. The EPF contribution is being reduced for Businesses &amp; Workers for 3 months, amounting to a liquidity support of ₹6,750 crores. The measures have been taken under Prime Minister Narendra <keyword id="6354642" type="PERSON" weightage="20" keywordseo="Modi">Modi</keyword>’s ₹20 lakh crore stimulus package. “Liquidity relief has been given for all EPF establishments. We extend the support that the government of India gave for another three months. Nearly 3.6 lakh establishments benefitted from this,” said Sitharaman. Earlier in March, under Pradhan Mantri Garib Kalyan Yojana (PMGKY) the central government had launched this EPF contribution scheme to help the economically weaker sections. Having already covered the salaries of March, April and May, now the salaries of June, July and August 2020 will come under this scheme. “Govt of India will pay the Employees' Provident Fund (EPF) contribution, both of employer and employee, put together it will be 24%, this will be for next 3 months.This is for those establishments which have upto 100 employees and 90% of them earn less than ₹15,000,” the finance minister said. See Also: <a href="https://www.businessinsider.in/policy/economy/news/top-highlights-of-finance-minister-nirmala-sitharaman-speech-on-modi-20-lakh-crore-covid-19-stimulus/articleshow/75714287.cms">Finance Minister Nirmala Sitharaman reveals the details of Modi's ₹20 lakh crore stimulus package</a> <a href="https://www.businessinsider.in/india/news/fm-nirmala-sitaraman-announces-six-steps-for-msme-sector/articleshow/75717258.cms">Finance Minister Nirmala Sitharaman announces six measures for the MSME sector</a>

Take home salaries for employees will increase as Finance Minister Nirmala Sitharaman reduces provident fund deduction

These are the new TDS, TCS rates applicable on fixed deposits, dividends, contracts and more

Union Minister of Labour and Employment <keyword id="19906409" type="General" weightage="20" keywordseo="mansukh-mandaviya" source="keywords">Mansukh Mandaviya</keyword> and Chairperson of the Central Board of Trustees, EPF, have given the green light to the proposal for a Centralised <keyword id="23037839" type="General" weightage="100" keywordseo="Pension-Payment-System" source="keywords">Pension Payment System</keyword> (<keyword id="23039389" type="General" weightage="20" keywordseo="CPPS" source="keywords">CPPS</keyword>) under the Employees' Pension Scheme, 1995. According to the Ministry of Labour and Employment, this initiative represents a major advancement by establishing a national-level centralised system, allowing pension disbursement through any bank or branch across India. Commenting on this development, Mandaviya stated, "The approval of the Centralised Pension Payment System (CPPS) marks a significant milestone in the modernization of the <keyword id="19966712" type="General" weightage="20" keywordseo="EPFO" source="keywords" meta.keywordsubtype="org" meta.entityname="EPFO" meta.hostid="83" meta.entityid="EPFO">EPFO</keyword>. By enabling pensioners to receive their pensions from any bank, any branch, anywhere in the country, this initiative addresses the long-standing challenges faced by pensioners and ensures a seamless and efficient disbursement mechanism." He added, "This is a crucial step in our ongoing efforts to transform the EPFO into a more robust, responsive, and tech-enabled organisation, committed to serving the needs of its members and pensioners better." The CPPS is expected to benefit over 7.8 million <keyword id="21992385" type="General" weightage="20" keywordseo="EPS-Pensioners" source="keywords">EPS pensioners</keyword> of EPFO. By leveraging advanced IT and banking technologies, it aims to provide a more efficient and user-friendly experience for pensioners. The CPPS will also ensure seamless pension disbursement across India, eliminating the need to transfer Pension Payment Orders (PPO) when a pensioner relocates or changes their bank or branch. This will be a significant relief for pensioners who move to their hometowns post-retirement. This facility will be launched on January 1, 2025, as part of EPFO's ongoing <keyword id="23015602" type="General" weightage="20" keywordseo="IT-Modernization" source="keywords">IT modernization</keyword> project, Centralised IT Enabled System (CITES 2.01). In the following phase, CPPS will enable a smooth transition to an <keyword id="20028363" type="General" weightage="20" keywordseo="Aadhaar-based-Payment-System" source="keywords">Aadhaar-based payment system</keyword> (ABPS). The CPPS marks a significant departure from the current decentralised pension disbursement system, where each EPFO Zonal/Regional Office maintains separate agreements with only 3-4 banks. Pensioners will no longer need to visit branches for verification at the start of their pension, as it will be credited immediately upon release. Additionally, EPFO anticipates a significant reduction in disbursement costs with the new system.

EPS Pensioners to get pension from any bank, any branch, anywhere in India from January 1, announces Mansukh Mandaviya

<ul><li>Investing in <keyword id="103549" type="General" weightage="20" keywordseo="elss" source="Orion">ELSS</keyword> not only aids in tax reduction but also offers the opportunity for wealth accumulation through equity exposure. </li><li>Investing in PPF provides a secure avenue for long-term savings, with a fixed tenure of 15 years and the option to extend in blocks of 5 years.</li><li>Investors opt for 5-year FDs due to their stability and assured returns, making them suitable for those seeking low-risk investment options. </li></ul>Now that we have stepped into the new year, there are just three months left before the current financial year draws to an end. Those who have made investment declarations to their employees to save funds under section <keyword id="6381499" type="General" weightage="20" keywordseo="80c" source="Orion">80C</keyword>, would have another month or two to show proof of investments to their employers. One needs to give evidence of investments to his/her employer by a certain time. This helps your employer calculate your taxable income and the amount of tax to deduct from your salary. “If you forget to submit the proof of investments to your employer, you can still claim those investments when you file your income tax return. Just make sure the investments were made before the end of the financial year,” says Archit Gupta, Founder and CEO, Clear, a fintech company It always helps to plan early, but in case you have not, here is a guide on how you can invest to avail section 80C tax deductions. Remember, that would apply to you only if you have opted for the old tax regime. Before making 80C investments, it is important to remember that the maximum deduction that you can avail is ₹1.5 lakh. Your contribution to the employee provident fund (EPF) is eligible for 80C deductions. So are your insurance premiums. If you have a home loan, the amount you pay towards the principal component of the home loan is also eligible for deductions under section 80C. So, when planning for 80C investments you need to first understand the amount you need to invest, which would in most cases be less than ₹1.5 lakh. Let us take a look at 5 investment options to avail 80C deductions in 2024. Equity Linked Savings Scheme Equity Linked Savings Schemes (ELSS) serve as a tax-saving avenue under section 80C of the Income Tax Act, offering benefits like a lower lock-in period of three years compared to other tax-saving instruments. ELSS primarily invests in equity and equity-related instruments, providing potential for higher returns over the long term. “ELSS helps you save tax and grow money at the same time,” Suneel Dasari, CEO, EZtax.in. However, it's essential to acknowledge the risks inherent in equity investments, including market volatility and fluctuations. The returns aren't guaranteed and can vary based on market performance. ELSS funds as a category have given returns of 26.57%, 19.55% and 17.13% in one, three and give years respectively. Public Provident Fund The Public Provident Fund (PPF) is a government-backed long-term savings scheme offering tax benefits under Section 80C. It allows contributions up to ₹1.5 lakh annually, making the invested amount tax-deductible. Investing in PPF provides a secure avenue for long-term savings, with a fixed tenure of 15 years and the option to extend in blocks of 5 years. It offers a 7.1% rate compounded annually. The risks associated with PPF are notably low due to its government backing, ensuring safety and stability. However, the lock-in period of 15 years and limited liquidity might pose constraints for individuals seeking shorter-term investment options. National Pension Scheme The National Pension System (NPS) is a voluntary retirement savings scheme offering tax benefits of up to ₹1.5 lakh under Section 80C and an additional ₹50,000 under Section 80CCD (1B), providing substantial tax savings. Investing in NPS is ideal for retirement planning, offering a choice of investment options across equities, corporate bonds, and government securities. Its unique feature includes two accounts: Tier I (non-withdrawable till retirement) and Tier II(withdrawable at any time). While NPS provides the opportunity for market-linked returns, it also carries market risks associated with investment in equity and debt instruments. Additionally, the Tier I account has a lock-in period until retirement, restricting liquidity. “Tax benefits will be applicable only to the investments under Tier 1 NPS Accounts. Tier 2 NPS accounts are not eligible for tax benefits,” says Dasari. Tax saving FDs A 5-year Fixed Deposit (FD) offers a secure investment avenue with a fixed interest rate for the specified tenure, typically ranging from banks to post offices. The invested amount is eligible for deduction under section 80C. Investors opt for 5-year FDs due to their stability and assured returns, making them suitable for those seeking low-risk investment options. However, these FDs may have lower returns compared to market-linked instruments like equity-based investments. Additionally, the lock-in period of 5 years limits liquidity and flexibility. Sukanya Samriddhi Yojana Sukanya Samriddhi Yojana (SSY) is a government-backed savings scheme designed for the financial security of the girl child. It offers tax benefits under Section 80C of the Income Tax Act, allowing contributions up to ₹1.5 lakh annually to be tax-deductible. Investing in SSY provides a dual advantage of tax savings and creating a corpus for a girl child's future expenses like education or marriage. The scheme offers an attractive interest rate(8.2%) and has a maturity period of 21 years from the date of account opening or until the girl child reaches 18, whichever is earlier. “For higher education purposes you can withdraw 50% of the amount deposited,” says Dasari. The risks associated with SSY are minimal as it's a government-backed scheme.

Tax saving countdown – With 2 months to go, options to consider under 80C

<ul><li><keyword id="6372438" type="General" weightage="20" keywordseo="epfo" source="Orion">EPFO</keyword> has reduced interest rates to the lowest in more than 40 years for the current financial year.</li><li>The government body has slashed interest rates to 8.1% from 8.5% in the previous fiscal year.</li><li>Despite EPFO’s interest rates being the lowest in its history in decades, it is higher compared to many other <keyword id="1791040" type="General" weightage="20" keywordseo="government-saving-schemes" source="Orion">government saving schemes</keyword> currently. </li></ul>The popular retirement saving scheme followed by many corporations for its employees has slashed its interest rates to a 40-year low amid such a challenging environment. On Saturday, the Employees' Provident Fund Organisation’s (EPFO) announced that it has recommended to reduce the interest rate of the retirement fund to 8.1% from 8.5% last year. The rate will now be approved by the Finance Ministry. While this is reportedly the lowest interest rate by EPFO since 1977-78, it still offers the highest returns than many other government saving schemes and bank deposits. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Saving instruments </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">% interest rate </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Employees Provident Fund </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.1% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Public Provident Fund Scheme </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.1% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Senior citizen savings scheme </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.4% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Sukanya Samriddhi Scheme </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.6% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Post Office time deposit (5 year) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.7% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">National Saving Certificate </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.8% </td></tr></tbody></table>Source: Department of Posts Ministry, Ministry of Communications Employees’ Provident Fund is a government retirement fund mandatory for employees earning up to ₹15,000 a month in firms with over 20 workers. Here the employee and the employer contribute to the EPF scheme on a monthly basis in equal proportions of 12% of the basic salary and dearness allowance. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Fiscal year </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">EPF interest rate </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY16 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.80% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY17 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.65% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY18 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.55% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY19 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.65% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY20 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.50% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY21 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.50% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY22 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.10% </td></tr></tbody></table>K E Raghunathan, member of central board of trustees after announcing the reduction, reportedly said that it is understood that this is going to be the most unpredictable year because of the war and market conditions, among other things. Hence, the government body doesn’t want to overcommit with high rates. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/paytm-payments-bank-denies-report-claiming-it-leaked-data-to-chinese-firms/articleshow/90203210.cms">Paytm Payments Bank denies report claiming it leaked data to Chinese firms</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/ecommerce/news/four-years-later-sachin-bansal-is-still-battling-eight-lawsuits-from-his-flipkart-days/articleshow/90202495.cms">Four years later, Sachin Bansal is still battling eight lawsuits from his Flipkart days</a>

EPFO continues to give attractive interests rate compared to other government schemes

<ul><li>Finance minister Nirmala Sitharaman today unveiled <keyword id="10547300" type="General" weightage="20" keywordseo="budget-2022" source="Orion">Budget 2022</keyword>, including several announcements in income tax and personal finance.</li><li>The announcements include crypto tax and a reduction in surcharge on long-term capital gains on other assets.</li><li>Here are all the key highlights for taxpayers in Budget 2022.</li></ul>Finance minister Nirmala Sitharaman announced several updates as far as personal finance is concerned, aiming at making things easier for individual taxpayers. While there were no big-bang announcements in Budget 2022, taxpayers have a few benefits to look out for. Analysts had expected a slew of announcements, including a hike in standard deduction for salaried individuals, and enhancement in deductions for investments, among other things. Those were all missing from the Budget 2022, much to the dismay of the common man. <cmsannotation type="cmsannotation" annotationid="Here are the most notable announcements in income tax and personal finance in Budget 2022:" comment="subhead" text="Here are the most notable announcements in income tax and personal finance in Budget 2022:">Here are the most notable announcements in income tax and personal finance in Budget 2022:</cmsannotation> <cmsannotation type="cmsannotation" annotationid="New updated return" comment="subhead" text="New updated return">New updated return</cmsannotation> Finance Minister Nirmala Sitharaman proposed a new clause that will allow taxpayers to file ‘updated’ returns to correct omissions and errors in their original tax returns, within two years from the end of the relevant assessment year. This proposal allows taxpayers to avoid lengthy processes which are involved in assessing and taxing income that has not been disclosed or assessed. It is worth noting that the updated return can only be filed if it results in the assessment of additional tax liability – that is, if the update reduces your tax outgo, or results in a return of loss, you cannot file it. Further, if you file the updated return within 12 months of the end of the relevant assessment year, you will be liable to pay an additional amount equivalent to 25% of the total tax and interest payable. If you do it between 12 and 24 months of the end of the relevant assessment year, this will increase to 50%. <cmsannotation type="cmsannotation" annotationid="Tax on proceeds from cryptocurrency and other digital asset sales" comment="subhead" text="Tax on proceeds from cryptocurrency and other digital asset sales">Tax on proceeds from cryptocurrency and other digital asset sales</cmsannotation> Proceeds from sale of cryptocurrencies and other digital assets will attract a tax of 30%, with no deductions allowed other than the cost of acquisition. Additionally, payments made to transfer these digital assets will attract a TDS of 1%. The government also said that other losses will not be allowed to be set-off against income from the sale of crypto and other digital assets, but it is not clear yet if crypto losses can be set-off against other incomes. Even the experts are divided. <cmsannotation type="cmsannotation" annotationid="Tax relief for persons with disability" comment="subhead" text="Tax relief for persons with disability">Tax relief for persons with disability</cmsannotation> Tax relief for persons with disability will be allowed annuity/lump sum payments if the guardian is above the age of 60 years. Earlier it was allowed only if the guardian was dead. <cmsannotation type="cmsannotation" annotationid="Surcharge on long-term capital gains capped at 15%, down from up to 37% earlier" comment="subhead" text="Surcharge on long-term capital gains capped at 15%, down from up to 37% earlier">Surcharge on long-term capital gains capped at 15%, down from up to 37% earlier</cmsannotation> Surcharge on long-term capital gains on transfer of any assets capped at 15%. Currently, the surcharge on any long-term gains from sale of stocks were capped at 15%. This rate could go up to 37% for other assets, Sitharaman said, which has now been capped at 15%. <cmsannotation type="cmsannotation" annotationid="EPF contribution deduction" comment="subhead" text="EPF contribution deduction">EPF contribution deduction</cmsannotation> Deduction on EPF contribution was brought to parity at 14% for both central and state government employees, from the 10% rate for state government employees earlier. SEE ALSO: <a href="https://www.businessinsider.in/budget/news/india-union-budget-2022-updates-and-key-highlights/slidelist/89265881.cms">Union Budget 2022: These are the biggest highlights from the Finance Minister’s speech</a> <a href="https://www.businessinsider.in/budget/news/from-cryptocurrencies-to-nfts-india-to-tax-all-virtual-digital-assets-at-30/articleshow/89268587.cms">From cryptocurrencies to NFTs, India to tax all ‘virtual digital’ assets at 30%</a> <a href="https://www.businessinsider.in/budget/news/nirmala-sitharaman-announced-that-5g-services-will-happen-by-2022-23-in-budget-session/articleshow/89267252.cms">5G spectrum auctions in 2022, commercial 5G rollout by 2022-23</a>

From crypto tax to updated IT return, here are the personal finance highlights from Budget 2022

New Delhi, May 15 () Retirement fund body EPFO has decided not to impose any penalty for delay in payment of employees' provident fund contributions by firms during the natiowide lockdown. Since the imposition of lockdown on March 25 by the government to contain the COVID-19 spread, businesses have been facing liquidity or cash crunch, leading to difficulties in paying their mandatory provident fund dues. "During the lockdown period we are not going to impose any damages (penalty). This is our pro stakeholder/businesses/employers attitude which we are following," Employees' Provident Fund Organisations (EPFO) Central Provident Fund Commissioner Sunil Barthwal said during a webinar organised by industry body PHDCCI on Friday. The EPFO has a provision of charging damages or penalty from the employers who are unable to deposit PF contributions as mandated under the EPF Scheme 1952. Employers are required to deposit dues on a month's salary by 15th of the next month. However, they get 10 days grace for payment after that. Earlier on April 30, the EPFO allowed employers to file monthly EPF returns without making simultaneous payment of dues, which gave a relief to about 6 lakh firms amid the lockdown. Under the scheme, employers are required to file employees provident fund returns and make payment of dues simultaneously. EPF returns have details about employees' and employers' contributions towards the social security scheme run by the EPFO. During the ongoing coronavirus-induced lockdown, businesses are not able to function normally and are facing liquidity issues or cash crunch to pay their statutory dues even though they are retaining the employees on their rolls, labour ministry had said in a statement on the decision. Barthwal also told the industry representatives during the webinar that the government's decision to cut employers and employees' PF contributions to 10 per cent each from the existing 12 per cent would be implemented in May month's salaries. "Soon notification is going to be out...May month salaries would be due in June. So we will apply it on the May month salaries," he said. Earlier this week, Finance Minister Nirmala Sitharaman had announced reduction of statutory provident fund contribution by both employers and employees to 10 per cent of basic wages from the existing 12 per cent for the next three months. The decision was taken to facilitate more take-home salary for employees and give relief to employers in payment of PF dues, resulting in a liquidity ease of Rs 6,750 crore. The decision is expected to benefit 4.3 crore employees and 6.5 lakh employers reeling under liquidity crunch due to COVID-19 lockdown. Without divulging details about type of claims and time period, Barthwal said as many as 23 lakh claims were settled with disbursal of Rs 8,000 crore. Earlier on March 28, the EPFO had allowed formal sector workers under its ambit to withdraw a non-refundable advance from their retirement savings to deal with hardships due to lockdown. Under this provision, non-refundable withdrawal to the extent of the basic wages and dearness allowances for three months or up to 75 per cent of the amount standing to member's credit in the EPF account, whichever is less, is provided. KKS MKJ

Lockdown: EPFO not charging penalty from cos for delay in payment of provident fund dues

New Delhi, May 13 () Union Home Minister Amit Shah on Wednesday said the Narendra Modi government is committed to reviving the economy, help small businesses and boost employment in the challenging time of coronavirus pandemic. In a series of tweets, Shah said the central government is doing everything possible to help those in the business sector as they may face financial stress while resuming their work following the lockdown to combat the coronavirus pandemic. "I thank PM @narendramodi and FM @nsitharaman for these unprecedented steps, targeted at assisting MSMEs, cope with challenges of COVID-19. "It reflects PM Modi's commitment to revive our economy, help small businesses and boost employment," he tweeted with the hashtag '#AatmaNirbharBharatAbhiyan'. Shah's comments came soon after Finance Minister Nirmala Sitharaman announced Rs 3 lakh crore of collateral-free loans for small businesses, a cut in the tax rate for non-salary payments and measures to provide liquidity to non-banking companies to help them tide over the disruptions caused by the lockdown. Unveiling the first set of components of the Rs 20 lakh crore COVID-19 economic stimulus package announced by Prime Minister Narendra Modi, she said Rs 90,000 crore liquidity infusion will be made in electricity distribution companies to help them fight the current financial stress. Also, dates for filing income tax returns and other assessments have been extended, she said. Shah said the Modi government's decision to provide Rs 3 lakh crore collateral-free automatic loans to businesses, including MSMEs, will surely help them meet their operational liabilities, built up due to COVID-19, and resume their business. About 45 lakh units and employees will benefit from this step, he said. "Modi government understands the issues and problems faced by the MSMEs, amidst COVID-19 pandemic. To help them in these stressed times, GoI (government of India) will facilitate provision of Rs 20,000 crore as subordinate debt, which will benefit more than 2 lakh MSMEs," he said. Shah said the Modi government will facilitate equity infusion worth Rs 50,000 crore for the MSMEs through 'Fund of Funds'. This will help them expand their size as well as capacity and encourage them to get listed, raise public money through stock exchanges, he said. The home minister said the government will also launch a Rs 30,000 crore Special Liquidity Scheme to help NBFCs / HFCs / MFIs / NBFCs / HFCs /MFIs as they are finding it difficult to raise money in debt markets. This decision will not only provide them liquidity support but also create confidence in the market, he said. "Modi govt is doing everything possible to help business sector as they may face financial stress while resuming their businesses. GoI to provide Rs 2,500 crore EPF support for business and workers for 3 more months. This will help about 3.67 lakh units and 72.22 lakh employees," he said. Shah said in these challenging times, to boost 'Make In India', help the MSMEs and other companies from the, often unfair, competition by foreign giants, the Modi government has disallowed global tenders upto Rs 200 crore which is a welcome step towards '#AatmaNirbharBharatAbhiyan'. "I thank PM @narendramodi's government for infusing liquidity of Rs 90,000 crore in DISCOMs, providing Rs 45,000 crore Partial Credit Guarantee Scheme 2.0 for NBFCs and Rs 50,000 crore liquidity through TDS/TCS rate reduction," he said. ACB RT

Modi govt committed to reviving economy, help MSMEs: Amit Shah

With <keyword id="35050" type="CITY" weightage="20" keywordseo="gdp">GDP</keyword> growth of 7.3%, in 2014-15, India’s economy is firmly on the path of economic revival. India is the brightest spot on the global map, with GDP Growth expected to rise to 7.9% in 2017-18. India is well positioned to withstand near-term global headwinds and the high volatility in global financial markets due to reduced external vulnerabilities, a strengthening domestic business and investment cycle, and a supportive policy environment. Most recently, even the IMF has maintained its GDP growth projection of 7.3% in 2015-16 and 7.5% in 2016-17, even as it cut projections for overall global output. 
	 The transition from a state of crisis of confidence in 2013 to a bright spot in 2015 is not by chance but by design. The past few months in particular, have seen even renewed energy from the Government to enforce key reforms, and revive industrial sentiment. Going forward, the upcoming Budget Session of <keyword id="6354721" type="ORGANIZATION" weightage="20" keywordseo="parliament">Parliament</keyword> will be very important in the current scheme of things, to create short &amp; medium term wins. 
	 
	Boosting Savings in India 
	 
	Most importantly, there is a need to boost savings in the economy to enhance the inherent economic strength of the financial sector. It will be worthwhile to adopt of the structural GEAR (Growth, Efficiency, Attractiveness, Reach) approach, as elaborated below, to augment the savings rate in the economy: 
	 
	Enhance economic growth to increase per capita incomes: Towards this end, it will be important to increase disposable incomes by relaxing personal income tax slabs to INR 5 lakh from the current level of INR 2.5 lakh – this could be a one-time correction and this could thereafter be linked to inflation and reviewed every three years. This will provide an immediate thrust to household incomes, part of which will be diverted to financial savings. 
	 
	Focus on efficiency in financial transactions: Use of plastic currency and e-transactions (via internet/mobile) will not only improve ease of transactions but also enhance saving propensity among citizens. Every 1% reduction in currency in circulation is likely to add 0.4% to the savings rate. More importantly, this could also help in curbing the flow of black money. 
	 
	Make financial savings attractive: Financial savings must be promoted by improving tax incentives. One of the enabling measures for this will be to enhance 80C limits to INR 3,00,000 from current level of INR 1,50,000 – this will also deepen the mutual fund and equity markets. Secondly there is a need to increase inflation adjusted post tax returns for bank deposits, by reducing lock in period eligible for tax rebate to 1 year from 5 years; and enhancing the threshold for mandatory TDS on interest income to INR 50,000 a year from the current level of INR 10,000. It will also be useful to roll back TDS on Recurring Deposits to encourage wider adoption, as this is a product that promotes the habit of regular saving. Further, pension products like EPF and PPF continue to enjoy ‘EEE’ tax status whereas the National Pension Scheme (NPS) are subject to ‘EET’, which involves tax obligation at the withdrawal stage. To create a level playing field and prevent cannibalization, NPS needs to get ‘EEE’ tax status to make it more attractive. 
	 
	Expand financial reach: The Government could consider converting India Post into Postal Bank of India, a full-fledged Payments and SAVINGS bank, to leverage its rural penetration for greater financial inclusion. Internationally, there are a few countries which have tapped the postal institution for extending financial inclusion. 
	 
	Next Generation of Reforms 
	 
	For 2016, I believe India’s top priorities should include passage of GST, rationalizing direct taxes further, tax sops for Start Ups and introducing key structural reforms in terms of real estate, labor and MSMEs. The farm sector too needs significant focus on irrigation and technological support. 
	 
	With the global economy expected to remain mired in volatility in 2016, strengthening the domestic economy will also help to ring-fence India against global headwinds. While micro measures will help, the Banking &amp; Finance sector also needs the next generation of reforms. I am hopeful that economic clairvoyance will triumph over political myopia in 2016 and GST will see the light of the day. The Bankruptcy Bill will also turn out to be a game changer for spurring economic activity and confidence. This Budget presents a Golden Chance to usher in Fiscal Measures to make 2016 India’s Year. 
	 
	The article has been authored by Rana Kapoor, managing director and CEO of YES Bank and chairman of YES Institute.

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The EPF reduction means you will pay tax on cash from your retirement fund

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Here’s what one of the largest private bank, YES Bank has to say about Budget 2016

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