Income Tax Amendment For Assessment Year 2020-2021 : PART-5

Standard Deduction u/s 16(ia)

Amount of Standard deduction u/s 16(ia) increase from Rs. 40,000/- to Rs. 50,000/- for the AY 2020-21.

Notional Rent on second self occupied house property exempt from tax u/s 23

Homeowners will not be required to pay tax on notional rent if they have more than one self-occupied property. According to the budget proposals, exemption has been proposed on the income tax from the notional rent on second –self-occupied house. This benefit is applicable for a person occupy two self occupied house property.

TDS threshold limit raised

To benefit small depositors and non-working spouses, TDS threshold limit has been proposed to be hiked to Rs 40,000 from the current of Rs 10,000 u/s 194A wef 01.04.2019

TDS threshold limit on rent paid or payable has been proposed to be hiked to Rs 2,40,000/- from Rs. 1,80,000/- in a financial year u/s 194I.

Sell 1, buy two houses

Currently capital gain arising from transfer of house property is exempt u/s 54 on purchase or construction of one residential house property within the stipulated time.

From the AY 2020-21 in order to save tax on long-term capital gains on the sale of house property one can invest capital gains in two house properties instead of one but this benefit is available once in a lifetime only if capital gains do not exceed Rs 2 crore.