No TCS On Sale Of Goods; Changes To TDS/TCS Regime : Union Budget 2025 Proposals
With an aim to reform the personal income tax regime with a special focus on middle-class citizens, the Union Finance Minister Nirmala Sitaraman has introduced key changes in the Budget 2025-26 at the August gathering today. Rationalisation of TDS and TCSWith an aim to rationalise Deducted at Source (TDS) and Tax Collected at Source(TCS), the following measures have been introduced:"I propose...
With an aim to reform the personal income tax regime with a special focus on middle-class citizens, the Union Finance Minister Nirmala Sitaraman has introduced key changes in the Budget 2025-26 at the August gathering today.
Rationalisation of TDS and TCS
With an aim to rationalise Deducted at Source (TDS) and Tax Collected at Source(TCS), the following measures have been introduced:
"I propose to rationalise tax deduction at source by reducing the number of rates and thresholds above which TDS is deduced. Further, the threshold amount for tax deduction will be increased for better clarity and uniformity. The limit for a tax deduction on interest for senior citizens is being doubled from the present Rs.50,000 to 1 lac. Similarly, the annual limit of 2.40 lac rupees for TDS on rent has been increased to 6 lac rupees. This will reduce the number of transactions liable to TDS. Thus, benefitting small taxpayers receiving small pay."
TCS on remittance
"The threshold to collect tax at source on remittances under the RBI[Reserve Bank of India] liberalised remittance scheme (LRS) is proposed to be increased from 7 lac to 10 lac. I propose to remove TCS on remittance for education purposes where such remittances are out of loans taken from specified financial institutions."
On transaction related to sale of goods
"Both TDS and TCS are being applied on any transaction related to sale of goods. To prevent such compliance difficulty, I propose to omit the TCS."
Higher TDS rates on non-PAN cases and due date for TDS
"I also propose the provisions of higher TDS will only apply in non-PAN cases. In July 2024, the delay of payment of TDS upto the due date of filing statement was decrimalised, I propose to provide same relaxation for TCS provisions as well."
New Income Tax Bill Will Be Introduced Next Week : Finance Minister
