Income From Salary: Amendments and Important Notes

 Budget 2019 (Major Amendments)

(Applicable for Assessment Year 2020-2021)

1. Standard Deduction for salaried persons raised from Rs. 40,000 to Rs. 50,000 [u/s 16(ia)]
2. Individuals having taxable income upto Rs. 5,00,000 to get a full rebate of the tax i.e upto Rs. 12,500 [u/s 87A]
3. TDS threshold on interest on bank and post office deposits raised from Rs. 10,000 to Rs. 40,000 [u/s 80TTA] (As per Budget 2019). But currently, it is 10,000 only
4. Capital Gain Exemption now available on the purchase of two house properties (once in a lifetime) [u/s 54] (*conditions apply). 

* Basic conditions for point 4

1. The following conditions should be satisfied to claim the benefit of section 54.

   • The benefit of section 54 is available only to an individual or HUF.
   • The asset transferred should be a long-term capital asset, being a residential house property.
   • Within a period of one year before or two years after the date of transfer of the old house, the taxpayer should acquire another residential house or should construct a residential house within a period of three years from the date of transfer of the old house. In the case of compulsory acquisition, the period of acquisition or construction will be determined from the date of receipt of compensation (whether original or additional).

   An exemption can be claimed only in respect of one residential house property purchased/constructed in India. If more than one house is purchased or constructed, then exemption under section 54 will be available in respect of one house only. No exemption can be claimed in respect of the house purchased outside India.

Notes: Income from Salary

Short Notes on Income from the Head Salary (click here)