Skip to main content

India Budget 2018 impact on Individual Taxation and Social Security


Tax rates and slabs:
1.    Education cess of 3% is replaced by Health and education cess of 4%
2.    No other changes in the tax rates and surcharge
3.    No changes in the tax slabs for individuals
4.    Thus, the maximum marginal rate of tax has increased from 35.535% to 35.88%

Standard deduction on salary income:
1.    Standard deduction of INR 40,000 or amount of salary received whichever is less has been introduced
2.    Exemptions currently available for transport allowance amounting to INR 19,200 per annum and reimbursement of medical expenses amounting to INR 15,000 per annum is proposed to be withdrawn.
3.    Transport allowance exemption for differently abled persons to continue.

Increased deductions for health insurance and treatment relating to senior citizens:

1.    Deduction under section 80D for health insurance premium, preventive health check up or medical expenditure in respect of senior citizens enhanced to INR 50,000 as against current overall limit of INR 30,000. In case of a single premium policy having cover for more than one year, the deduction shall be available on a proportionate basis for the period of cover.
2.    Deduction under section 80DDB in respect of medical treatment of specified diseases relating to senior and very senior citizens has been enhanced to INR 1,00,000 from the existing limits of INR 60,000 and INR 80,000 respectively.

Other benefits to Senior citizens:

1.    Existing provisions of 80TTA not applicable to senior citizens. A new section 80TTB is introduced providing deduction of INR 50,000 against interest income.

PF contributions for new employment :
1.    Government will contribute 12% of the wages of the new employees to EPFO for all the sectors for a period of three years; Consequently, no employer contribution is required in the initial years. This will apply to all new employees earning upto INR15,000 a month for the first three years of their employment (PMRPY scheme)

2.    Women employee’s contribution for the first three years of employment is proposed to be reduced to 8%. However, employer contribution in respect of women employees will continue at current rates.

Comments

Post a Comment

Popular posts from this blog

Difference Between IT Governance and GEIT (Governance of enterprise IT)

Chapter 1 Concepts of governance and management of enterprise IT DIFFERENCE BETWEEN IT GOVERNANCE AND GEIT According to our study material, IT Governance refers to the system in which directors of the enterprise evaluate, direct and monitor (First they evaluate i.e. form an opinion, then they direct i.e. what should be done and then in last they monitor i.e. what should be done is actually being done.)  IT Management to ensure  effectiveness, accountability and compliance  of IT. My dear friends, note the line (effectiveness, accountability and compliance of IT) i.e. only of IT. Now what is GEIT???? lets start with a definition..... GEIT is the system by which IT activities in a company are directed and controlled to achieve business objectives with the ultimate objective of meeting stakeholders needs.  And as given in earlier post  Corporate Governance  is a system by which  company  is  directed and controlled  to achieve objectives of increasing stakeholder
8 comments
Read more

Work Day Interface PECI (Human Capital Management) Introduction

Workday is a very popular Human Capital Management Software but they do not have good Payroll Processing Capabilities which is the final outcome of a Human Capital Software. To address this, they have given a good interface i.e. PECI Interface i.e. (Payroll Effective Change Interface). It is latest interface version given by Workday for integrating Human Capital Software with a Payroll and Statutory Compliance Software for calculating organisation tax compliance and Employee Salary. In this article, let us discuss the strengths and weakness of Workday interface and how organisations can overcome that. Strengths: This workday interface extract all the transactions in XML format which is very easy to analyse and study for any potential error or gap. It works on Pay Group ID logic where data is interfaced as per pay group id mapped to employees. With each transaction, Workday PECI use 'Update' or 'Added' Flag so Payroll vendor can easily identify the tran
6 comments
Read more

Macau (SAR) Tax with Calculator

Link to Macau Tax Calculator:  http://www.dsf.gov.mo/tax/tax_downloadapps.aspx?lang=en Introduction ·          Individuals are subject to tax on income arising in Macau. Residency of an individual has no significance in determining tax liability. ·          Professional Tax is imposed on employment and self-employment income arising in Macau. For the purpose of tax, taxpayers are divided into employees and professional practitioners. ·          Tax Year End is 31st December. ·          PAYE System is used to withhold taxes ·          TFN: When an individual commences employment, they will be requested to quote their Tax File Number (TFN) to their employer. ·          Tax Amount is rounded up to the nearest dollar. ·          When are estimates/prepayments/withholding of tax due in Macau? For example: monthly, annually, both, and so on. ·          Monthly for expatriates, quarterly for Macau residents and non-residents with a working permit. Types of Taxable C
8 comments
Read more