Key Financial Rule Changes From October 1: From Aadhaar Card Policy to Taxation and Savings, All You Need To Know

Mumbai, September 27: As October 1, 2024, approaches, a range of significant changes in personal finance will take effect, impacting taxpayers, investors, and everyday savers across the country. These updates, driven by the Union Budget 2024, aim to simplify tax procedures and address issues such as PAN misuse and small savings account management. The changes range from modifications to Aadhaar card regulations to increases in the Securities Transaction Tax (STT) and alterations in TDS rates for specific payments. Financial Year 2024: Know All About New EPFO Rule, Tax Regime and FASTag Changes Coming Into Effect From From April 1.

Understanding these updates is essential for effective budget planning and ensuring compliance with new financial norms. The introduction of the revised Direct Tax Vivad Se Vishwas Scheme also presents new avenues for taxpayers to settle ongoing disputes. Let's look at the key financial changes that will come into effect from October 1,  which will not only affect individual taxpayers but also businesses and investors navigating the evolving financial landscape. New Rules From September 1: Credit Card Rules, Aadhaar Free Update and More, Know Key Financial and Regulatory Changes Taking Effect From Next Month.

Key Financial Changes Effective October 1

1. Aadhaar Card Policy: From October 1, individuals can no longer use their Aadhaar enrolment ID when applying for a PAN or filing income tax returns. This change aims to prevent misuse and ensure accurate reporting of tax information.
2. Bonus Shares Trading: SEBI's new framework allows bonus shares to be eligible for T+2 trading, shortening the time between the record date and when they can be credited and traded. This will enhance liquidity and make the trading process more efficient for investors.
3. Increased Securities Transaction Tax (STT): The STT on options trading will rise from 0.0625 per cent to 0.1 per cent. This adjustment is part of a broader strategy to moderate speculative trading in the booming derivatives market.
4. Direct Tax Vivad Se Vishwas Scheme 2024: This updated scheme allows taxpayers to resolve ongoing disputes regarding tax, interest, penalties, and fees pending before appellate bodies. Taxpayers can now settle disputes that were unresolved as of July 22, 2024. This initiative aims to reduce litigation and streamline the tax resolution process.
5. Post Office Accounts Interest Changes: Changes will impact the interest earned on Post Office small savings accounts. Account holders need to be aware of these updates as they may affect their savings growth.
6. Floating TDS Rate on Bonds: A new TDS rate of 10 per cent will be applied to income from central and state government bonds. However, no TDS will be deducted if the total income from these bonds is less than INR 10,000 in a financial year.
7. Lower TDS Rates for Certain Payments:  The Budget has introduced lower TDS rates for various payments, including those under sections 194H, 194-IB, and 194M, reducing the rate from five per cent to two per cent. Additionally, the TDS rate for e-commerce transactions has been lowered from one per cent to 0.1 per cent.
8. Taxation of Share Buybacks: Shareholders will now be responsible for paying taxes on share buybacks, similar to how dividends are taxed. This shift may influence corporate strategies for distributing returns to shareholders.
9. Changes in Small Savings Schemes: The Ministry of Finance has issued new guidelines for regularising improperly opened accounts under National Small Savings (NSS) schemes. Irregular accounts must be submitted for regularisation, with specific guidelines provided for categories such as PPF accounts opened in minors' names.

As these key financial changes come into effect, individuals and businesses must stay informed to adapt their financial practices accordingly. Understanding these adjustments will not only aid in compliance but also enhance overall financial management.

(The above story first appeared on LatestLY on Sep 27, 2024 10:22 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).