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New financial changes from April 1 are going to affect unused UPI numbers, zero balance bank accounts, GST, and income tax slabs; here are the 12 key financial changes you must know:
The tax rebate under Section 87A has been increased from Rs 25,000 to Rs 60,000, with effect from April 1. This rebate allows for a tax-free income of up to Rs 12 lakh.
The financial year 2025-26 is set to begin from April 1. With this, a number of financial changes are going to take place, including no income tax up to Rs 12 lakh annual income, unused UPI number to be deactivated, and no dividend if PAN-Aadhaar not linked, among others.
What Are The Changes
1. No Income Tax On Rs 12 Lakh Annual Income
The tax rebate under Section 87A has been increased from Rs 25,000 to Rs 60,000, with effect from April 1, 2025. This rebate allows for a tax-free income of up to Rs 12 lakh.
2. Unused UPI Numbers To Be Deactivated
From April 1, all those UPI numbers that been not been used in the past 12 months will be deactivated. Inactive numbers not used for calls, messages, or other services will also be removed. It is necessary to update your banks with your active mobile numbers by March 31.
3. No Dividend If PAN-Aadhar Not Linked
It is necessary to link your PAN and Aadhaar by March 31. Starting April 1, no dividend income will be received if your PAN and Aadhaar are not linked. Also, TDS will also increase on dividend capital gains, and no credit in Form 26AS will be available.
4. Mutual Fund & Demat KYC
The KYC for mutual funds and demat will be done from April 1, 2025. Under this, all nominee details will also be verified again.
5. 18% GST On Restaurants Service In Hotels Offering Rooms Above Rs 7,500
Starting April 1, hotels charging a room rent above Rs 7,500 a day at any time in any financial year will be considered ‘specified premises’, and restaurant services provided inside such premises will attract 18 per cent GST with input tax credit.
6. Minimum Maintenance In Bank Accounts
SBI, PNB and Canara Bank are going to make it mandatory to keep minimum balance, failing which will attract penalty.
7. Positive Pay System For Cheque Clearance To Enhance Security
In order to strengthen security in transactions, a fraud prevention mechanism Positive Pay System has been announced. Under this mechanism, for any payment above Rs 50,000 via cheque, the account holder will have to share key details with their bank electronically, including cheque number, date, amount, and payee name. The bank will verify these details before processing the payment.
8. Priority Sector Lending
Starting April 1, home loan borrowers can avail up to Rs 50 lakh in major cities, Rs 45 lakh in mid-sized cities, and Rs 35 lakh in smaller towns under priority sector lending.
9. Increase in TDS Threshold
Starting April 1, the TDS threshold for various sections has been increased. For senior citizens, the TDS limit on interest income will rise to Rs 1 lakh.
10. Upgradation In TCS Rules
As of April 1, 2025, TCS rates have changed, affecting foreign travel, investments, and other transactions. Previously, TCS was applicable on amounts exceeding Rs 7 lakh, but this limit has now been raised to Rs 10 lakh.
11. Extended Time Limit For Updated Tax Returns (ITR-U)
The time limit for filing an updated ITR has been extended from 12 months to 48 months (4 years). If the return is missed for any reason, it can now be updated within four years.
12. Changes In ULIP
According to the Budget 2025, redemption proceeds from ULIPs that exceed the premium threshold of Rs 2.5 lakh will be treated as capital gains and taxed under Section 112A of the Income Tax Act.
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