Personal Tax

Gifts to Not – Ordinarily Resident Insurance

• Gifts of money or property to Resident but Not Ordinary Resident (RNOR) exceeding INR 50,000 are also brought under the purview of section 9 of the Act by making these deemed to accrue or arise in India (presently applicable only for non residents)

• Any sum received from any insurance policies (other than Unit Linked Insurance Policy), issued on or after 1 April 2023, having premium or aggregate of premium above INR 500,000 in a year is to be taxable. However, any sum received on death of the person shall remain exempt.

• Maturity amount received net of premium paid (except premium already claimed as deduction) on redemption of such policy will be taxable as Income from Other Sources.

LTCG exemption on reinvestment

• Section 54 & 54F allows exemption from capital gains on investment in new residential house. The exemption under the said sections is without any upper cap. It is proposed to cap the exemption to INR 10 Crs

• Consequentially, the same cap applies to the amount to be deposited in the Capital Gains Account Scheme w.e.f. fiscal year 2023-24.

Change in TCS rates

• Section 206C(1G) has been proposed to be amended w.e.f. 01-07-2023 to increase TCS from 5% to 20% on overseas tour package & in cases other than remittance for the purpose of education or medical treatment, without any threshold limit