Income Tax News: Beware! New Rules Changed in 2024 That May Impact Your ITR Filing in 2025, Check

The year 2024 has brought several significant changes to income tax rules, which are set to influence taxpayers when filing their Income Tax Returns (ITR) in 2025. These updates encompass modifications in tax slabs, capital gains rules, standard deductions, TDS regulations, and more. Taxpayers are advised to familiarize themselves with these changes to effectively plan their finances and reduce tax liabilities.

Major Changes in Income Tax Rules

Revised Holding Period for Capital Gains

To classify capital gains, the holding period is now categorized as 12 months for listed assets and 24 months for unlisted ones. This revision encourages taxpayers to factor in tax savings when deciding to sell assets.

Simplified TDS Rates

Certain income sources now have simplified TDS rates, reducing overall deductions. However, there is no change in TDS rules for salaries, virtual digital assets, lotteries, and contracts.

TDS/TCS Credit Adjustment

Salaried employees can now offset TDS/TCS deductions on other income sources with their salary’s TDS, enhancing cash flow management.

Taxation on Share Buyback

Amounts received from share buybacks will now be taxed as per the individual taxpayer's income tax slab, potentially increasing liabilities for those in higher slabs while benefiting lower slab taxpayers.

TCS on Luxury Goods

Starting January 1, 2025, Tax Collected at Source (TCS) will apply to luxury goods purchases exceeding ₹10 lakh. The list of such goods and specific collection methods are yet to be announced.

Vivaad se Vishwas Scheme 2.0

The government has introduced this scheme to resolve pending disputes between taxpayers and the Income Tax Department, simplifying compliance.

Plan Ahead to Manage Tax Liabilities

These changes underscore the importance of early tax planning. With new rules potentially affecting both individual and corporate taxpayers, experts advise keeping abreast of updates and seeking professional advice for effective compliance and tax management in 2025.