Income Tax (No.2) Bill Updates Exemptions, TDS Rules, and Payment Modes Under Section 187

The new Income Tax (No.2) Bill, passed by the Lok Sabha, reinstates exemptions for anonymous donations to religious-cum-charitable trusts, aligning with the Income Tax Act, 1961, and removes the earlier proposed 30% tax on such donations to mixed-object non-profits. It restores flexibility for individuals to claim TDS refunds without mandatory timely filing of income tax returns. The bill adds "profession" in clause 187 to enable professionals with receipts over Rs 50 crore to use prescribed electronic payment modes, shortens the TDS correction statement filing period from six to two years, and revises loss carry-forward provisions for clarity. It also incorporates amendments related to Unified Pension Scheme tax exemptions, block assessments in search cases, and tax benefits for certain foreign public investment funds. These changes reflect Select Committee recommendations aiming to reduce taxpayer grievances and ensure taxation aligns with net income principles for non-profit organizations.