Beware of the new tax provisions for 2017-18

With interesting tweaks in the income tax provisions, different people may get impacted differently. Some people may have to pay less, while others may have to pay more.

The amended provisions are as follows:-

1. With the slab rates changed to 5% from 10% earlier for the taxpayer with income between Rs 2.5 lakh and Rs 5 lakh, there will be a rebate of Rs 2,500 for people with income less than Rs 3.5 lakh as against the earlier rebate of Rs 5000 for an income upto Rs 5 lakh. The change in the tax rate will provide a maximum tax benefit of Rs 12,500.

2. For individuals with an income between Rs 50 lakh to Rs 1 crore, there will be a surcharge of 10%. This will lead to additional tax up to a maximum of Rs 154,500.

3. Another important change is the period for considering the long term capital gains from immovable property. This period has been reduced from 3 years to 2 years. With this provisioning, home owners will not be able to set off the losses on long term capital assets over the short term of two years.

4. There will be a 5% deduction of taxes on housing rentals paid to landlord, if the rent exceeds Rs 50,000.