Union budget 2013 kumbhat
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Transcript of Union budget 2013 kumbhat
UNION BUDGET 2013
KUMBHAT & CO.,
Chartered Accountants
04/03/2013
1
KUMBHAT & CO - MARCH 2013
BUDGETARY HIGHLIGHTS
Revised Estimates (RE) of the expenditure in 2012-13 at 96 per cent of the Budget Estimates (BE) due toslowdown and austerity measures.
During 2013-14, BE of total expenditure of Rs.16,65,297 crore and of Plan Expenditure atRs.5,55,322 crore.
‰Plan Expenditure in 2013-14 to grow at 29.4 % overRevised Estimates for the current year.
‰All flagship programmes fully and adequately fundedand sufficient funds provided to each Ministry orDepartment consistent with their capacity to spendfunds
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KUMBHAT & CO - MARCH 2013
BUDGETARY HIGHLIGHTS
Plan expenditure is placed at Rs. 5,55,322crore.
‰Non Plan Expenditure is estimated atRs.11,09,975 crore.
‰Fiscal deficit for the current year contained at5.2 per cent and for the year 2013-14 at 4.8%.
‰Revenue deficit for the current year at 3.9 percent and for the year 2013-14 at 3.3 %.
‰By 2016-17 fiscal deficit to be brought down to 3%, revenue deficit to 1.5%
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BUDGETARY HIGHLIGHTS
ALLOCATION Amount in Crores
Programmes for Women 97134
Programmes for Children 77236
Health 37330
HRD 65687
Drinking Water 15260
Rural Development 80194
JNNRUM 14873
Agriculture 27049
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KUMBHAT & CO - MARCH 2013
INVESTMENT IN INFRASTRUCTURE
Project Steps
Infrastructure Tax free Bonds Rs.50,000 crore to be issued in 2013-14
Warehousing Rs.5,000 crore to NABARD for Financing the
Construction of Warehouses
Roads 3000 Kms in Gujarat, MP, Maharashtra, Rajasthan
and UP
Industrial Corridors • Plans for 7 new cities finalised, 2 smart industrial
cities at Dholera, Gujarat and Shendra Bidkin,
Maharashtra
•Delhi Mumbai Industrial Corridor to be given
additional funds
•Chennai Bengaluru Industrial Corridor to be
developed
•Bengaluru Mumbai Industrial Corridor –
preparatory work commenced
Ports 2 new Ports – Sagar in WB and one in AP. Outer
Harbour in the VOC port, Thoothukudi to be
developed
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KUMBHAT & CO - MARCH 2013
DIRECT TAX PROPOSALS
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ADDITIONAL REBATES/DEDUCTIONS
Rebate up to Rs. 2000/- if GROSS TOTALINCOME < Rs. 5 lacs for Individuals – Section87A.
Additional Interest deduction of Rs. 1 lac on 1st
Residential House, if loan taken from FI or Bankbetween 01.04.13 and 31.03.14, Loan should <Rs. 25 lacs, Cost of Residential house shouldnot be > Rs. 40 lacs. Rs. 1 lac only in total for 2Asst. years i.e 2014-15 and 2015-16 – forIndividuals – Section 80EE
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KUMBHAT & CO - MARCH 2013
DEDUCTIONS UNDER CHAPTER VIA
Donation to National Children Fund – 100%
deduction – 80G
For Life Insurance Policy taken by person with
severe disability or suffering from specified
ailment then insurance premium up to 15% of
insured value allowed for deduction u/s 80C.
Donation made in Cash to political parties will
not be allowed u/s 80GGC
Rajiv Gandhi Equity Saving Scheme introduced
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KUMBHAT & CO - MARCH 2013
RAJIV GANDHI EQUITY SAVINGS SCHEME
Deduction u/s 80CCG up to Rs. 25000/-
Investment in Equity Listed Securities andEquity Linked MF
The gross total income should not exceed Rs.12 lacs. First time investor.
The scheme has been extended for 3 years.
The investment should be locked for 3 years.
CAUTION: Invest only if you understand theEquity market.
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KUMBHAT & CO - MARCH 2013
AGRICULTURE INCOME REDEFINED
If Farm House let out which is on agriculturalland in an area measured aerially, then it isnot agricultural income, if the agri land issituated
< 2 kms from local municipal limits if population is>10K but < 1 lac
< 6 Kms from local municipal limits, if population is> 1 lac < 10 lacs
< 8 kms from local municipal limits, if population >10 lacs
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KUMBHAT & CO - MARCH 2013
AGRICULTURE LAND REDEFINED
No capital gains will arise on sale of agricultural landmeasured aerially, then it is not capital asset if theland is situated
< 2 kms from local municipal limits, if population is>10K but < 1 lac
< 6 Kms from local municipal limits, if population is > 1lac < 10 lacs
< 8 kms from local municipal limits, if population > 10lacs
Capital gains will arise on sale of agricultural land iflocated within this criteria. Agricultural land within theaerial distance will be subject to WEALTH TAX.
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KUMBHAT & CO - MARCH 2013
SURCHARGE
Income – Corporates/Firms Rate
Less than Rs. 1 crore NIL
> Rs. 1 crore < Rs. 10 crore 5%
> Rs. 10 crore 10%
For Individuals Rate
< Rs. 1 crore Nil
> Rs. 1 crore 10%
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KUMBHAT & CO - MARCH 2013
TDS AND DDT
NO change in Rates for all except
- Royalty and Technical fees paid to NON RESIDENT –TDS is @ 25% of such amount payable. – 115Aw.e.f. 1.4.13 ( AY 14-15)
TDS on purchase of immovable property other thanagri land and property < Rs. 50 lacs @ 1% - 194 IAw.e.f.1.6.2013 – Buyer to deduct the tax.
Dividend distribution tax to be paid by the Companyon BUY BACK of shares @ 20% on differencebetween allotment price and buy back price. Capitalgains continue to be payable on buy back of sharesin the hands of the shareholder.
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KUMBHAT & CO - MARCH 2013
CAPITAL GAINS AND OTHER SOURCES
Any immovable property registered at lessthan guideline value, the seller needs to paycapital gains tax on the guideline/stamp dutyvalue – Sec 50C – existing provision
The buyer will have to pay regular incometax on the difference betweenguideline/stamp duty value and registeredvalue as Income from other sources Sec 56- w.e.f 1.4.13 ( AY 2014-15)
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KUMBHAT & CO - MARCH 2013
BUSINESS INCOME/OTHER SOURCES
For a person in real estate business - anyimmovable property registered at less thanguideline/stamp duty value, the seller needsto pay income tax on the guideline/stampduty value – Sec 43CA – similar to existingprovision Sec 50C for capital gains
Difference between guideline value andregistered value will be income from othersources in the hands of the buyer!
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KUMBHAT & CO - MARCH 2013
INVESTMENT ALLOWANCE
15% Investment allowance for investment in
Plant and Machinery over Rs. 100 crore.
Available over a period of 2 years AY 14-15
and AY 15-16.
Only for NEW Machinery Imported or
indigenous.
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GENERAL ANTI AVOIDANCE RULE – CHAPTER X A
An arrangement may be declared
impermissible tax benefit
To be effective from 1.4.2016
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TRC AND DTAA
Tax residency certificate is required to claim benefit under a DTAA. Circular 789 exists.
With the amendment, TRC is not sufficient condition, hence opens the discretion to the assessing officer. Will apply even if the assessee does not claim any benefit under DTAA Sec 90 and 90A
Clarification issued by Finance Ministry, The TRC will be accepted as evidence
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STT AND CTT
It is proposed to reduce securities transaction tax
('STT') rates on equity oriented funds (w.e.f. 1 June,
2013) as under:
- On delivery-based purchase on the exchange - from 0.1%
to Nil;
- On delivery-based sale on the exchange - from 0.1% to
0.001%;
- Sale of a unit to the mutual fund - from 0.25% to 0.001%.
Commodities Transaction tax at 0.01% on non-
agricultural commodity futures. CTT to be allowed as
deduction if income falls under the head 'Profits and
Gains from business or profession'
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INDIRECT TAX PROPOSALS
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SERVICE TAX
Vocational training Institutes approved by National and State Councils exempt
Seed testing exempt from Service tax
Penalty for non registration maximum penalty Rs. 10000
Personal Liability on Director/Secretary or other officer of Company if willfully evades tax, issues dummy bills, utilization of credit without actual receipt of taxable service, failure to pay service tax collected
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SERVICE TAX VOLUNTARY COMPLIANCE
ENCOURAGEMENT SCHEME 2013
New chapter VI
Scheme open from 1.3.2013 to 31.12.2013
Applicable only to a person against whom NO
- Inquiry or investigation has been initiated
- Search of premises
- Issuance of Summons
- notice issued for production of accounts etc
- audit has been initiated
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SERVICE TAX – VOLUNTARY DISCLOSURE
All service tax liability to be offered up to1.1.2013.Interest and penalty waived on totaltax dues.
Payment of such service tax declared to bepaid – atleast 50% by 31st Dec 2013 andbalance 50% by 30th June 2014.
Interest will be effective from 1st July 2014 @18% p.a.
No refund of the tax paid
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CUSTOMS DUTY
Stay granted for collection of Customs Duty for cases pending inAppellate Tribunal can be extended further upto 185 days after180days. In case appeal not disposed within 365 days, stays standsvacated.
Criminal Procedure Code of 1973 will be initiated if
- Evasion of duty exceeds Rs. 50 lacs
- Import of goods not declared of which market price > Rs. 1 crore
- Fraudulent availment of drawback or any exemption and dutyexceeds Rs. 50 lacs
Can attach all receivables if the duties are not paid
Customs duty to be paid within 2 days of arrival. Earlier it was 5days.
Even Re 1 is payable as duty. Earlier duty below Rs. 5 and belowwas ignored. Imported Samples will fall under this category
Rs. 100/- and below will not be refunded.
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EXCISE DUTY
Stay granted for collection of Excise Duty for cases pending inAppellate Tribunal can be extended further upto 185 days after180days. In case appeal not disposed within 365 days, staysstands vacated.
Criminal Procedure Code of 1973 will be initiated if
- Evasion of duty exceeds Rs. 50 lacs
-Fraudulent availment of drawback or any exemption and dutyexceeds Rs. 50 lacs
Can attach all receivables if the duties are not paid
Follow up SCN is valid with the original SCN
Service of notice by RPAD has been replaced by Speed Post,Courier – reversing certain case laws
Advance Ruling for New Business
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THANK YOU!!
PH: 0422-2541398/2546700
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