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Thursday, 01 Feb 2024
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What the budget has for business owners and self-employed individuals

Hello and welcome to your personalised summary of the 2024-2025 Interim Budget. The budget has a host of interesting information for business owners and self-employed individuals.

PM Mudra Yojana Expansion: This scheme has sanctioned 43 crore loans aggregating to ₹ 22.5 lakh crore, catering to the entrepreneurial aspirations of the youth. This scheme is particularly beneficial for small business owners and self-employed individuals seeking financial assistance to start or expand their ventures.

Skill India Mission: With 1.4 crore youth trained and 54 lakh upskilled or reskilled, along with the establishment of 3000 new ITIs, this initiative aims to create a skilled workforce. This can benefit business owners by providing them with a pool of skilled employees.

Empowerment of Women Entrepreneurs: The government has facilitated 30 crore Mudra Yojana loans for women entrepreneurs. This empowers women to start or expand their businesses, contributing to a diverse and inclusive economic environment.

Agriculture and Food Processing Support: With the Pradhan Mantri Kisan Sampada Yojana and Pradhan Mantri Formalisation of Micro Food Processing Enterprises Yojana, the government is promoting value addition in agriculture, which can open up new opportunities for businesses in the food processing sector.

Support for Artisans and Craftspeople: The PM-Vishwakarma Yojana provides end-to-end support to artisans engaged in 18 trades, which directly benefits self-employed artisans by improving their business prospects and market reach.

Technology and Innovation Focus: The government's focus on innovation, with the establishment of a ₹1 lakh crore corpus for research and innovation, offers opportunities for businesses involved in technology and research sectors to access funding and support.

Infrastructure Development: Significant investments in infrastructure development, including the implementation of major railway corridor programs and the expansion of the aviation sector, are likely to improve logistics and connectivity for businesses.

Green Energy Initiatives: The emphasis on green energy and related sectors, such as bio-manufacturing and the establishment of biomass aggregation machinery, opens up new business avenues in the environmental sector.

Tax Benefits and Rationalization: The retention of the same tax rates for direct and indirect taxes, along with specific benefits to start-ups and investments made by sovereign wealth or pension funds, provides financial relief and encourages investment in businesses.

Ease of Doing Business: Efforts to improve tax-payer services, such as the introduction of Faceless Assessment and Appeal and the simplification of tax returns, aim to reduce the bureaucratic burden on businesses.

Tax Updates for Individual Tax Payers

For individuals other than those falling under specific categories:

- Total income up to Rs. 2,50,000: Nil tax

- Total income between Rs. 2,50,000 and Rs. 5,00,000: 5% of the amount exceeding Rs. 2,50,000

- Total income between Rs. 5,00,000 and Rs. 10,00,000: Rs. 12,500 plus 20% of the amount exceeding Rs. 5,00,000

- Total income exceeding Rs. 10,00,000: Rs. 1,12,500 plus 30% of the amount exceeding Rs. 10,00,000

For individuals aged 60 years or more but less than 80 years:

- Total income up to Rs. 3,00,000: Nil tax

- Total income between Rs. 3,00,000 and Rs. 5,00,000: 5% of the amount exceeding Rs. 3,00,000

- Total income exceeding Rs. 5,00,000: Rs. 10,000 plus 20% of the amount exceeding Rs. 5,00,000

For individuals aged 80 years or more:

- Total income up to Rs. 5,00,000: Nil tax

- Total income between Rs. 5,00,000 and Rs. 10,00,000: 20% of the amount exceeding Rs. 5,00,000

- Total income exceeding Rs. 10,00,000: Rs. 1,00,000 plus 30% of the amount exceeding Rs. 10,00,000

Surcharge on Income Tax:

- Surcharge is applicable on the income tax amount calculated as per the above rates.

- The surcharge rates vary based on the individual's residency status and income level.

- The surcharge ranges from 10% to 37% for non-residents and individuals with different income brackets.

Other Important Updates:

- e-Verification scheme: The authorities have introduced an e-Verification scheme to collect accurate income information and reduce tax evasion. This scheme aims to ensure comprehensive determination of income.

- PAN as Business Identification Number (BIN): PAN is now being leveraged as the BIN for registration purposes in various government departments and services. This integration aims to streamline processes and enhance efficiency.

- Integration of PAN with Aadhaar: PAN and Aadhaar integration has been carried out to facilitate de-duplication and ensure accurate identification. As of December 31, 2023, a total of 58.76 crore PANs are linked with Aadhaar.

- Integrated e-Filing and Centralised Processing Center 2.0 (CPC 2.0) project: The CPC 2.0 project aims to provide a better e-filing experience, ease of compliance, and faster processing of Income Tax Returns (ITRs). As of December 31, 2023, 8.18 crore ITRs have been filed for AY 2023-24, marking a 9% increase compared to the previous year.

- Tax Information Network 2.0: The introduction of TIN 2.0 has enabled real-time credit of taxes and faster refunds to taxpayers' bank accounts. Till November 27, 2023, 6 crore challans involving an amount of Rs. 12.54 lakh crores have been processed.

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