Changes that will impact your pocket, Here are 5 new rules that have changed from September 1, 2019

31 May 2019, was appointed as the finance and corporate affairs minister, becoming India’s first full-time female finance minister.

On 5 July 2019, FM Nirmala Sitharaman presented her maiden budget in the Indian parliament. Normally, as the budget is presented in March, changes come into force from April. But since this year’s budget was presented in July, the changes will come into effect from September

These changes will directly impact your pocket as you need to shell more money

1. TDS at the time of purchasing an immovable property

Section 194-IA of the Act relates to payment on transfer of certain immovable property other than agricultural land and provides for levy of TDS. This section has been modified to include, payments such as club membership fees, car parking fees, electricity and water facility fees, maintenance fee, etc into cost of buying property amount.

A buyer will be required to deduct TDS at the rate of 1 per cent of purchase price while buying an immovable property of more than Rs 50 lakhs with effect from September 1.

2. TDS on life insurance policy

If you are purchasing Single Premium life insurance policy, you need to be aware of the new TDS rule. If the Life Cover on your policy is less than 10 times annual premium, maturity amount will be taxable and TDS would get deducted. Earlier 1% TDS was deducted. But from 1st Sept onwards, 5% TDS will be deducted from the maturity proceedings.

3. Deduct TDS for a professional job

In budget 2019 FM had proposed to insert a new section 194M for levy of TDS at the rate of 5 per cent on the amount paid on account of professional / contractual fees by an individual if such amount exceeds Rs 50 lakh in a year. This will be effective September 1, 2019.

4. TDS on cash withdrawal

India is still a “cash” based economy. In order to move towards less cash economy, levy of tax deduction at source (TDS) of 2 per cent on cash payments in excess of Rs 1 Crore in aggregate made during the year is enforced. This new rule takes effect from 1st September, 2019.

5. IRCTC tickets to cost more!

Couple of years back IRCTC had decided to waive of service charge to promote digital economy. However wef 1st Sept, the service charge will be back. IRCTC will levy a service charge of Rs 15 per ticket for non-AC classes and Rs 30 for AC classes, including first class.

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