From Penalty Hike For Delay In PAN-Aadhaar Linking To IT Rule, Know Finance-Related Changes Effective July 1

New Delhi: It’s time to gear up for the financial changes kicking in from July 1, 2022. There are several reforms including taxation, stock market and crypto transactions that will impact your financial lives. Even as tax will be imposed on capital gains made on cryptocurrencies transaction, there is still no clarity on new labour codes.

Know financial changes to be effective from July 1

PAN-Aadhaar linking to become costlier:

In case you are among those who have not yet linked PAN card with your Aadhaar card, then you have to pay penalty. According to the revised rule by the Central Board of Direct Taxes (CBDT), a penalty of Rs1,000 will be levied if the PAN-Aadhaar linking is done on or after July 1, 2022. Until June 30, the penalty was Rs 500.

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TDS on crypto transactions

The income tax department informed that the 1 per cent TDS on transfer of virtual digital assets would be levied on net transaction value and the onus of deducting the tax would primarily be on the exchanges. The Finance Act, 2022, inserted a new section, 194S, in the Income Tax (I-T) Act, 1961 under which the new tax will be levied.

Demat account tagging

Sebi has said all untagged demat accounts of stock brokers needs to be tagged by June end. It has clearly stated that the credit of securities will not be allowed in any Demat account left untagged from July 1, 2022, onwards. However, it permitted credits on account of corporate actions. The debit of securities would not be allowed in any Demat account left untagged from August 1, 2022.

Income tax rule for social media influencers and doctors

The most important change will be affecting doctors, YouTubers, and influencers. Those who belong to these professions and are receiving free items from companies will have to pay taxes for the items from July 1. The social media influencers will be liable to pay 10 per cent TDS if they receive a product like a car, mobile, outfit, etc, and retain the same. However, if the product is returned to the company after using the services, it will not fall under Section 194R.

New Labour codes

The government had released four Labour Codes to amend the rules governing employer-employee relations and modify labour laws.  From working hours to in-hand salary, several aspects concerning employment and work culture may change in case the new labour codes are implemented. The four broad codes spanning from wages, industrial relations, social security, and occupational safety, health, to working conditions (OSH) have been notified after getting the President's assent. However, the rules implementing these four codes need to be notified.