Finance (No.2) Bill, 2024 as passed by Lok Sabha as on 7-8-2024

Salary & family pension deductions enhanced for new tax regime. Standard deduction up from Rs. 50K to Rs. 75K. Family pension deduction up to Rs. 25K/...

Employer's pension contribution deductible up to 14% of employee's salary from AY 2025-26. Sec 80CCD amended for higher deduction.

Proposed Amendments Enhance IFSC Operations: Tax Exemptions for Retail Funds, ETFs, Core Settlement Funds, and Finance Companies.

Tax exemption for closely-held cos on share issue premium from FY26. Excess consideration over fair value not taxable as income.

Presumptive tax regime for non-resident cruise operators: 20% of receipts deemed profits. Intra-group lease rentals exempt till 2030-31.

Block Assessment Rules Streamline Tax Searches & Requisitions: 60% Tax on Undisclosed Income, 50% Penalty if Not Declared.

Streamlining assessment/reassessment: New notice procedures, information definition, approval requirements, time limits, and transitional provisions.

Period for imposing penalties rationalized. Limitation calculated from appellate order date, not receipt by top officers. Effective 01/10/2024.

IT Act amended to allow withholding refund for 60 days post assessment if it adversely impacts revenue, with reasons recorded.

Section 253 amended for appeals to ITAT against tax orders. Includes undisclosed income penalties. Time-limit rationalized.

Tax Exemption Shift: First Regime Ends Oct 2024, Transition to Second Regime with New Rules and Preserved Investments.

Delay in filing trust registration can be condoned if reasonable cause exists. Effective Oct 1, 2024. Prevents permanent exit from exemption.

Amendment to Section 80G: Streamlined Timelines for Approval Applications to Enhance Charitable Donations and Tax Deductions.

Faster processing for tax exemption applications from trusts/funds. 6 months from quarter-end, not month-end. Applies to new & renewal cases.

Merger of trusts/institutions rationalized. Accreted income may attract provisions. New section 12AC clarifies conditions for exemption.

Trusts can claim exemptions u/s 10(23EA), (23ED), (46B) by choosing operative/inoperative 12AB registration. Rationalizes charitable trust provisions.

Capital gains tax simplified: 2 holding periods, 20% short-term rate on equity shares/funds, 12.5% long-term rate with Rs. 1.25L exemption.

Specified Mutual Fund definition clarified: >65% in debt/money market instruments or >65% in such funds. Fund-of-Funds included. Effective 04/01...

Proposed TDS Rate Cuts for Sections 194D, 194DA, 194G, 194H, 194-IB, 194M, 194-O; Section 194F Omission Planned.