GBP & Associates

💡 New Income Tax Regime Isn’t Just About Standard Deduction — Key Benefits Salaried Taxpayers Still Get

As the Income Tax Act, 2025 and its draft rules are poised to take effect from 1 April 2026, there’s an important narrative shift in how we understand the new tax regime. While popular perception has been that it only offers a standard deduction of ₹75,000, a closer look at official rules reveals that several practical tax benefits continue to apply even if taxpayers opt for the new regime.

Here’s what salaried individuals can still claim under the new system:
✔️ Employer gifts up to ₹15,000 annually remain tax-free festival gifts, vouchers or small rewards won’t add to taxable income.
✔️ Free meals, tea & snacks at the workplace continue to be exempt within prescribed limits.
✔️ Medical treatment for specified serious illnesses (paid by employer in approved hospitals) is not treated as taxable income.
✔️ Interest-free / concessional employer loans up to ₹2 lakh still enjoy exemption.
✔️ Official laptops & computers for work provided by employers remain non-taxable perquisites.

👉 What this means: The new tax regime strikes a balance combining lower tax rates and fewer deductions with everyday perquisites that salaried taxpayers often benefit from. The old regime remains relevant for those who extensively use traditional deductions, while the new regime offers simplicity and operational perks that shouldn’t be overlooked.

📊 For taxpayers and advisors alike, the smarter approach is to compare net tax outgo under both regimes, rather than rely solely on perception.

📢 Important Update for Taxpayers!

🔹 CBDT Circular No. 10/2025 dated 28th July 2025
🔹 Relief for Invalidated Income Tax Returns

The Central Board of Direct Taxes (CBDT) has issued a much-needed relaxation in the time limit for processing income tax returns that were declared invalid by CPC (Centralized Processing Centre) due to technical issues — such as non-verification of signatures.

✅ Returns filed electronically up to 31.03.2024 that were erroneously invalidated by CPC will now be processed.
✅ Time extended till 31.03.2026 to get such returns validated and processed.
✅ Applicable for all assessment years.
✅ Refunds, if due, will also be processed with interest, subject to PAN-Aadhaar linkage.

📌 If your return was marked invalid by CPC, it is advised to follow up immediately and get it processed.
📌 Ensure your PAN is linked with Aadhaar to receive any refund smoothly.

📝 This move provides significant relief to taxpayers and helps resolve long-pending issues.

The Income Tax Department has extended the deadline to file Income Tax Returns (ITRs) for the assessment year 2025–26 from July 31 to September 15, 2025.

This extension in the deadline to file tax returns will provide more time to taxpayers for collecting documents and aligning with changes in guidelines and compliance norms.

“There have been many significant revisions in ITR forms, system development needs, and TDS credit reflections. This ensures a smoother and more accurate filing experience for everyone. Formal notification will follow,” the Central Board of Direct Taxes (CBDT) said in a social media post on ‘X’.

🎓✨ Congratulations, CA Drashti Patel! 🎉

We are incredibly proud to celebrate the success of our team member on achieving the prestigious title of Chartered Accountant.

This milestone reflects her unwavering dedication, hard work, and commitment to excellence.

At GBP & Associates, we are honored to have such a talented professional as part of our team and look forward to witnessing her continued success and contributions to the profession.

Wishing you an exciting and fulfilling journey ahead, CA Drashti Patel! 🚀

Warm Dhanteras Greetings from GBP & Associates, Chartered Accountants

On this auspicious occasion of Dhanteras, we wish you and your family abundance, prosperity, and financial growth. May your investments flourish, and may your wealth bring you lasting happiness and success.

Happy Dhanteras!

Warm regards,
GBP & Associates,
Chartered Accountants

New form to reduce TDS from salary: CBDT issues Form 12BAA to tell employer about other taxes paid by you

To implement the Budget 2024 announcement regarding the adjustment of TDS and TCS from other sources against salary TDS, the Central Board of Direct Taxes (CBDT) has issued a new form called Form 12BAA.

This form will be utilized by employees to report to their employers the tax deductions from sources other than their salaries, such as fixed deposits, insurance commissions, dividends from equity shares, or tax collected while making purchases, like buying a car or foreign currency.

Employers typically deduct TDS from salary as per the declaration given by the employee, taking into account investments and expenses eligible for tax deductions. However, employers did not adjust the taxes paid by the employee against other sources. Now, this will change with the newly notified form from the CBDT.

By informing their employer about TCS collected and TDS deducted via this new form, the employee can lower their tax deduction from their salary. The move will help the employees deal with cash flow issues and increase their income to spend or save. CBDT notified the new form via a notification issued on October 15, 2024.

Source - https://economictimes.indiatimes.com

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Attention Taxpayers! Income Tax Department warns against false claims in income tax returns

The Income Tax Department has issued a strong advisory to taxpayers, advising them against submitting income tax returns with inaccurate claims for exemptions and deductions. Authorities emphasized the serious repercussions of such behavior, which may result in significant fines and the possibility of imprisonment.

The Joint Commissioner of Income Tax, N. Abhinaya, emphasized the program’s central message, which centered on enabling employees to adhere to tax regulations. She disclosed that in the fiscal years 2022-23 and 2023-24, numerous salaried workers had submitted inaccurate claims. Ms. Abhinaya cautioned that there would be serious repercussions for incorrect deductions. False claims would result in a 200% penalty and possible imprisonment.

The recent initiative by the Income Tax Department emphasizes the importance of accuracy and honesty in taxpayers’ filings. Adhering to tax laws can help individuals steer clear of harsh penalties and legal consequences. Keep yourself updated, file your returns accurately, and enjoy a hassle-free tax season.

NPA tag does not remove interest liability: NFRA

“It has come to the attention of the NFRA during a disciplinary action under Section 132(4) of the Act for professional misconduct of the statutory auditor (CA Som Prakash Aggarwal) of a listed company (Vikas WSP Limited), that the company in the Financial Statements of 2019-20, had discontinued accrual/recognition of interest expense on its bank borrowings, which had been reportedly classified as non-performing asset (NPA) by the lender banks and for which the company was negotiating one time settlement with the banks,”

This accounting treatment was in contravention of the provisions of applicable accounting standards, as these borrowings, as well the interest payable thereon, continued to be the financial liabilities of the company and were required to be accounted for as amortised cost, following the requirements of Indian Accounting Standard (Ind AS) 109, Financial Instruments. Similar violations have been observed in respect of several other companies too, it said.

“Mere classification of the company’s borrowings as NPAs by the lender banks does not relieve the borrowing company from its liability towards payment of interest and/or the principal,” the NFRA said.

It may be relevant to note that the RBI guidelines also require the banks to maintain a memorandum record of accrued interest on the loans classified as NPAs, reflecting the fact that the bank has not yet legally released the borrowers from their contractual liability to pay interest on their borrowings from the bank.

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