The new rates for tax collected at source (TCS), KYC norms for mutual funds and demat accounts, mutual fund folios nomination, and several important financial changes will come into effect from October 1. Next month will also mark the end of the Reserve Bank of India's (RBI) facility to exchange or deposit withdrawn Rs 2,000 currency notes. Here's a list that you need. 


New Tax Collection At Source (TCS) Rates



Starting October 2, overseas spending on credit cards exceeding Rs 7 lakh will be subject to a 20 per cent TCS, barring expenses incurred for medical or educational purposes, where the TCS rate would be 5 per cent. The government had hiked TCS rates during the Union Budget 2023-24 announcement. It was first set to come into effect on July 1, 2023, but later postponed till October 1. 


With the new TCS rate International travel plans will get costlier and TCS on overseas tour packages will now attract a higher TCS rate. Effective from October 1, 2023, the new TCS rates for LRS and overseas tour packages in India are as follows:



  • LRS for education financed by the loan will Nil up to Rs 7 lakh, 0.5 per cent above Rs 7 Lakh.

  • LRS for Medical treatment/education (other than financed by loan) will Nil up to Rs 7 lakh, 5 per cent above Rs 7 Lakh.

  • LRS for other purposes will be 5 per cent above Rs 7 lakh and 20 per cent above Rs 7 Lakh. 

  • Purchase of Overseas tour program package will be 5 per cent till Rs 7 lakh, 20 per cent thereafter. 


 Also Read: TCS Rule On Foreign Remittance To Come Into Effect From October 1, Here's What It Means


Birth Certificates To Become Single Document For Aadhaar, Govt Jobs


Registration of Births and Deaths (Amendment) Act, 2023 which was passed by the Parliament during the Monsoon Session this year allows the use of a birth certificate as a single document for admission to an educational institution, issuance of a driving licence, preparation of voter list, Aadhaar number, registration of marriage or appointment to a government job. The act will come into force from October 1. 


According to the government, the new rule will facilitate the creation of a national and state-level database of registered births and deaths which eventually would ensure efficient and transparent delivery of public services and social benefits, and digital registration.


Also Read: Use Of Birth Certificates As Single Document For Various Purposes To Come Into Force From October 1




Mutual Fund Folios, Demat Accounts Nomination













The Securities and Exchange Board of India (Sebi) in March extended the deadline to file a nominee or opt out of it for all individual demat account holders and mutual fund investors to September 30, 2023. Failing to comply with the deadline will result in frozen accounts and folios. This mandate applies to both new and existing investors.


“Based on the assessment of the trading as well as demat accounts in which choice of nomination details (i.e. furnishing of nomination or declaration for opting out of nomination) has not been updated and on the basis of representations received from the stakeholders, it has been decided that the provisions mentioned at para 7 of SEBI circular dated July 23, 2021, read with para 3 (a) of SEBI circular dated February 24, 2022, with regard to freezing of accounts shall come into force with effect from September 30, 2023 instead of March 31, 2023," the market regulator said in a circular dated March 27.


New investors must either nominate their securities or formally opt out of nomination through a declaration form when opening trading and demat accounts. For existing investors, failing to meet this deadline will result in the freezing of folios for debits. Further, investors' demat accounts or mutual funds folios will be frozen and inaccessible until they nominate or declare opt-out.


Investors can also opt out of the nomination by submitting a declaration form to their demat account provider or mutual fund house.


SEBI has taken this step to help investors secure their assets and pass them on to their legal heirs. It is important for all investors to comply with this requirement before the deadline.


Aadhaar Number For Small Savings Accounts


The central government has made Aadhaar numbers mandatory for making investments in small saving schemes like the Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), Post Office Saving Scheme, Senior Citizens Saving Scheme (SCSS). The Ministry of Finance issued a notification in this regard earlier this year as part of KYC (Know Your Customer) for small saving schemes.  Before this, it was possible to invest in small savings plans without providing an Aadhaar number. 


From now on Aadhaar enrolment number will be required in order to invest in government-backed small saving schemes. The notification also made it clear that anyone making investments over a specific amount will also need to provide the PAN card. Missing this important deadline will result in getting their small savings investments frozen.







Exchange of Rs 2000 banknotes


The Reserve Bank of India (RBI) has set September 30, 2023, as the last date to exchange or deposit Rs 2000 banknotes. The RBI has urged all members of the public to exchange or deposit their Rs 2000 notes by the deadline. This can be done at any bank branch or RBI office.


While the Rs 2,000 remains a legal tender, it is not yet clear if the central bank will extend the exchange deadline. The RBI is likely to provide an update on the future status of Rs 2000 notes after the deadline.