From October 1, RBI’s new guidelines for debit and credit cards have come into effect to secure payments. Meanwhile, the government has kept the interest rates on Public Provident Fund (PPF) and National Savings
Certificate (NSC) unchanged from the previous quarter.
Taxpayers, investors, depositors and consumers may get affected by some of the latest policy changes, such as deadline changes for filing revised income tax returns (ITR) and new guidelines for credit and debit cards by the Reserve Bank of India (RBI).
Here are the five key changes to be noted:
Extension of deadline for filing belated or revised ITRs
Due to difficulties being faced by taxpayers because of the COVID-19 pandemic, the Central Board of Direct Taxes (CBDT) has extended the due date for furnishing of belated and revised income tax returns (ITRs) for assessment year (AY) 2019-20 from September 30 to November 30.
The Centre had on July 29 extended the deadline for filing of original and revised ITRs till September 30. The two-month extension – the third such given for FY21 – comes as the government looks to mitigate taxpayers’ “hardships” amid the coronavirus pandemic.
New debit/credit card guidelines from RBI rolls out
From October 1, RBI’s new guidelines for debit and credit cards have come into effect to secure payments.
These will include:
– Allowing international transactions on a card at the customer’s request.
– Cards that have not been used for contactless or online payments since issuance can be turned off, and customers can choose to block such transactions.
– Spending limits on cards can be set up by customers.
TCS on foreign remittances over Rs 7 lakh
The Central Board of Direct Taxes (CBDT) on September 29 issued a detailed clarification pertaining to the new TDS/TCS provisions applicable from October 1.Three new provisions pertaining to tax collected at source (TCS) have been brought in via amendments to the Finance Act, 2020. Under the first one, 5 percent TCS would be applicable on amounts exceeding Rs 7 lakh in a financial year for foreign remittances under the Liberalised Remittance Scheme (LRS) of the RBI. Additionally, a restricted TCS of 0.5 percent would apply in case of remittances towards loans for pursuing education.
Next, a 5 percent TCS on purchase of overseas tour packages, irrespective of the value, is applicable under the new norms. Also, TCS at 0.1 percent on sale of goods of over Rs 50 lakh in a year.
Under the new rules, companies are required to file returns by the following month’s 10th day.
Health insurance standardised
In accordance with the guidelines and specifications issued by the Insurance Regulatory and Development Authority of India (IRDAI) from October 1, health insurance policies have been reintroduced. COVID-19 will now be covered under schemes launched after the date.
Small savings rates unchanged
The government has kept the interest rates on Public Provident Fund (PPF), National Savings Certificate (NSC) and other small saving schemes unchanged for the October-December quarter of FY20-21.
PPF will, thus, continue at interest rate of 7.1 percent per annum, NSC at 6.8 percent, Senior Citizens Savings Scheme at 7.4 percent (paid quarterly), and savings deposit at 4 percent, the same as the previous quarter.
Besides these, interest rate on Sukanya Samriddhi Yojana is maintained at 7.6 percent, on Kisan Vikas Patra (KVP) is retained at 6.9 percent per annum, on term deposits ranging from one to five years has been kept at 5.5-6.7 percent (paid quarterly), and on five-year recurring deposits at 5.8 percent.