Financial Year 2020-21 is about to end and new Financial Year 2021-22 is going to begin from 1st April 2021. With the arrival of the new financial year, there are some major changes taking place which are going to affect an earning individual’s money matter to a larger extent. Changes in LPG cylinder price, banking rules due to merger of banks, income tax rule changes in terms of EPF investment, TDS/TCS deduction, etc. are some of the glaring changes that are going to take place from 1st April 2021. We list out the top 5 changes that are going to have a direct impact on your budget and monetary affairs.
1.Change in LPG cylinder price
On the first date of every month, the central government announces the LPG cylinder price. In March 2021, LPG price in New Delhi was increased from Rs 769 per LPG cylinder to Rs 819 per LPG cylinder price. Since petroleum prices in the global markets are rising, there can be further rise in the LPG cooking gas price on 1st April 2021.
2.Cheque book, passbook of 7 banks to become non-functional
If you have bank account in any of these seven public sector banks — Dena Bank, Vijaya Bank, Corporation Bank, Andhra Bank, Oriental Bank of Commerce, United Bank of India and Allahabad Bank — then your passbook and cheque book will become non-functional from 1st April 2021. This will happen because of the merger of these banks in various other banks. Dena Bank and Vijaya Bank have been merged with Bank of Baroda, Oriental Bank of Commerce and United Bank of India have been merged with Punjab National Bank (PNB), Corporation Bank and Andhra Bank have been merged with Union Bank of India.
3.Income Tax rule on EPF investment
From 1st April 2021, one’s investment in EPF account is no more free from the income tax. From 1s April 2021, one’s investment in EPF above Rs 2.5 lakh in a financial year is taxed. One’s EPF interest on EPF investment above Rs 2.5 lakh in a particular year is taxable.
4.Income Tax rule on TDS
Income tax rule for TDS (Tax Deducted at Source) will get changed from 1st April 2021, which is just a few days away. In her budget speech, Sitharaman said that if a person doesn’t file income tax return (ITR), then in that case, the TDS rate on bank deposits would double. That means, even if an earning individual doesn’t fall in the income tax slab, the TDS rate levied on them will be doubled (in case the earning individual does not file ITR).
5.LTC cash voucher scheme
The central government notified the Leave Travel concession or LTC cash voucher scheme’s exemption in place of a leave travel concession (LTC). Under this scheme, an employee can claim an exemption under LTC allowance against the purchase of specified goods or services. This scheme is only available till 31st March 2021, i.e. money must be spent by this date to avail of the scheme.