From today, apply for PAN card without Aadhaar – Here's what else changes from October 1
In an effort to curb PAN card misuse and duplication, the Centre has revised regulations regarding Aadhaar usage. From October 1, 2024, taxpayers will no longer be able to use their Aadhaar Enrollment ID in place of an Aadhaar number for PAN applications or in Income Tax Returns (ITRs).
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FollowStarting October 1, 2024, several key changes to income tax rules will come into effect as part of the modifications introduced in the Union Budget 2024. These changes, which cover areas such as Aadhaar and PAN card regulations, Securities Transaction Tax (STT), TDS rates, and the Direct Tax Vivad Se Vishwas Scheme 2024, have been formally approved and are set to impact taxpayers and investors alike. Here's a breakdown of the major changes:
Securities Transaction Tax (STT) hike:
One of the significant changes includes the revision of the Securities Transaction Tax (STT) on Futures and Options (F&O) of securities. Starting October 1, 2024, STT on futures will rise to 0.02%, while for options, it will increase to 0.1%. Additionally, income from share buybacks will now be taxed at the beneficiary level, adding to the tax burden on investors.
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Aadhaar-PAN link changes:
In an effort to curb PAN card misuse and duplication, the Centre has revised regulations regarding Aadhaar usage. From October 1, 2024, taxpayers will no longer be able to use their Aadhaar Enrollment ID in place of an Aadhaar number for PAN applications or in Income Tax Returns (ITRs).
Taxation on share buybacks:
A significant shift in tax policy concerns the taxation of share buybacks. Beginning in October, buybacks will be taxed at the shareholder level, similar to how dividends are currently taxed. This means that shareholders will now have to factor in the acquisition cost of shares when calculating capital gains or losses, potentially leading to a higher tax liability for investors involved in such transactions.
TDS on floating rate bonds:
Starting October 1, a 10% tax deducted at source (TDS) will be applicable to specific central and state government bonds, including floating rate bonds. However, this TDS will only apply if the annual income from such bonds exceeds Rs 10,000. This move is expected to impact bond investors, particularly those holding larger amounts.
TDS rate revisions:
The Union Budget 2024 also included a reduction in TDS rates, which will take effect from October 1. TDS rates under sections 19DA, 194H, 194-IB, and 194M will be reduced from 5% to 2%. Additionally, the TDS rate for e-commerce operators has been cut from 1% to 0.1%, providing some relief to businesses operating in the digital space.
Direct Tax Vivad Se Vishwas Scheme 2024:
The Direct Tax Vivad Se Vishwas Scheme 2024, aimed at reducing income tax litigation, will also come into effect on October 1. The scheme allows taxpayers to resolve ongoing disputes with the tax department, including appeals pending in the Supreme Court, high courts, and other appellate authorities as of July 22, 2024.
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