In the Budget of 2019 Government had brought in tax-related amendments.

The new rules which are effective from September 1st will make a difference in how you do bank transactions, hire professionals services, buy properties or life insurance.

From 1st September tax-related changes are:

TDS on cash withdrawal

A levy of 2 percent tax deduction at source (TDS) will be applicable if it exceeds Rs. 1 Crore in one or more accounts maintained by an individual.

PAN mandatory for all cash transactions

The past bracket of allowing cash deposit below 50000 without a need for PAN is now being removed.

From now on smaller transactions will require mentioning of PAN.

Deduction of TDS for a professional job

While one hires an individual for any professional work in a personal capacity, one has to deduct 5% TDS during the payment under the new Permanent Account Number (PAN) rule 194M.

To deposit the tax deducted one can use his or her own along with the professional’s PAN only. Separate Tax deduction Account Number (TAN) is not required.

TDS on immovable property.

Any payment on the immovable property besides agricultural land a levy of 1 percent is charged.

Whereas other facilities associated with the property such as car parking, electricity/water fees, club membership now will also be subjected to TDS.

Life insurance policy

Earlier, TDS on single premium life insurance policy, when the sum assured, was less than 10 times was 1 percent of the maturity value.

Now it will be 5 percent on net maturity amount which will be calculated as – maturity amount minus the premium paid.

If the maturity proceeds are at least ten times the premium, then it will be tax-free.