As we step into the new financial year, a wave of important financial and tax changes is coming our way from April 1, 2025. These changes, announced by Finance Minister Nirmala Sitharaman in Budget 2025, will impact everything from income tax to banking and digital payments. Whether you’re a salaried professional, an investor, or a business owner, here’s what you need to know:
1. Big Tax Relief for Salaried Individuals
From April 1, annual income up to Rs 12 lakh will be completely tax-free under the new tax regime. Plus, with a standard deduction of Rs 75,000, salaried individuals earning up to Rs 12.75 lakh won’t have to pay any income tax.
2. UPI Rules Are Changing – Don’t Lose Access
To enhance security, the National Payments Corporation of India (NPCI) will deactivate UPI IDs linked to mobile numbers that have been reassigned or remain unused for a long time. If you haven’t used your UPI-linked number in a while, update it now to avoid deactivation.
3. Credit Card Reward Points Update
Some credit card users will see changes in their reward structures. SBI SimplyCLICK and Air India SBI Platinum credit card holders will have new reward policies, while Axis Bank will modify benefits on Vistara credit cards following the Air India-Vistara merger.
4. Unified Pension Scheme (UPS) Comes into Effect
The government’s Unified Pension Scheme (UPS), announced in August 2024, will officially roll out. Government employees with 25+ years of service will receive 50% of their last 12-month average basic salary as a pension.
5. Stricter Security for GST Portal Users
Starting April 1, multi-factor authentication (MFA) will be mandatory for logging into the GST portal, ensuring tighter security. Additionally, e-way bills can only be generated for documents that are less than 180 days old.
6. Higher GST on Premium Hotel Services
Hotels with room tariffs exceeding Rs 7,500 per day in any financial year will now be classified as ‘Specified Premises.’ Restaurant services in such hotels will attract 18% GST but will be eligible for input tax credit.
7. Minimum Balance Rules for Bank Accounts
Major banks, including SBI, PNB, and Canara Bank, have revised their minimum balance requirements. Falling below the required balance from April 1 could result in penalties.
8. PAN-Aadhaar Linking Deadline – Don’t Miss It!
If you haven’t linked your PAN and Aadhaar by March 31, you won’t receive dividend income from April 1. Also, your TDS deductions will increase, and no credit will reflect in Form 26AS.
9. KYC Now Mandatory for Mutual Funds & Demat Accounts
From April 1, 2025, KYC compliance will be mandatory for all mutual fund and demat account holders, including re-verification of nominee details.
10. Positive Pay System for Large Checks
To prevent fraud, a positive pay system will be introduced for check payments above Rs 50,000. Before processing, banks will verify check details provided electronically by the account holder.
11. Changes in Priority Sector Lending
Home loan borrowers can now avail up to Rs 50 lakh in metro cities, Rs 45 lakh in Tier-2 cities, and Rs 35 lakh in smaller cities under the Priority Sector Lending scheme.
12. Increase in TDS limit
The TDS exemption limit on interest income for senior citizens has been raised to Rs 1 lakh, providing much-needed relief.
13. New TCS Limits for Foreign Transactions
From April 1, new Tax Collection at Source (TCS) rates will apply. The TCS limit on foreign travel, investments, and large transactions will increase from Rs 7 lakh to Rs 10 lakh.
In Conclusion…
These rule changes will impact your taxes, banking, and financial transactions. Make sure you complete any necessary updates—such as linking PAN with Aadhaar, updating KYC details, or adjusting your UPI settings—before April 1 to avoid any disruptions. Stay informed and plan ahead for a smooth financial transition!
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This blog is purely for educational purposes. Mutual fund investments are subject to market risks, read all scheme-related documents carefully.
