From Aadhaar enrollment to income tax rules: Key changes that will affect your finances from Oct 1

Mumbai: The announcement made by the Union government regarding multiple changes in rules and regulations related to income tax, Aadhaar Card, and TDS on mutual funds, rents, and futures and options (F&O) in the Union Budget 2024 will take effect on October 1. Here are six key changes:

Aadhaar Enrollment 

The Centre's decision to end the option of using the Aadhaar enrollment ID in place of the Aadhaar number will take effect on October 1. Starting next month, individuals will no longer need to provide their Aadhaar enrollment ID in PAN allotment documents or when filing income tax returns.

Vivad Se Vishwas Scheme 2024 

The new 'Vivad Se Vishwas 2024' scheme offers taxpayers a chance to resolve disputes related to direct taxes, including income tax, interest, penalties, and court fees. Disputes pending as of July 22, 2024, can be settled under this scheme. In the case of new disputes, the settlement amount will be lower. Those willing to settle the dispute before December 31, 2024, will need to pay either the full tax amount or up to 25 per cent of the disputed tax amount, interest, penalty, or fee. After December 31, the payment will increase to 110 per cent of the disputed tax amount or 30 per cent of the interest, penalty, or fee.

Increased securities transaction tax

The securities transaction tax (STT) on futures and options trading will be increased. The STT for options selling will rise from 0.0625 per cent to 0.1 per cent, and for futures, it will go from 0.0125 per cent to 0.02 per cent.

Changes in tax deducted at source (TDS)

A 10 per cent TDS will be applied if annual income from floating rate bonds exceeds Rs 10,000. TDS rates for various other categories, such as life insurance payouts and lottery commissions, will be reduced from 5 per cent to 2 per cent. TDS for e-commerce activities will drop from 1 per cent to 0.1 per cent.

Tax on share buybacks

Shareholders will now be responsible for paying taxes on profits earned from the redemption of shares. Previously, companies paid a 20 per cent tax on this, but now it falls on individual shareholders according to their tax brackets.