HIGHLIGHTS OF DIRECT TAXES CODE BILL, 2010

Separate threshold exemption limits for men and women done away with. Common threshold limit of Rs. 2,00,000. For resident senior citizens, threshold increased from Rs. 2,40,000 to Rs. 2,50,000.

HRA exemption restored.

Employer's contributions to NPS (not exceeding 10% of salary), to approved superannuation fund (no limit - limit of 1,00,000 done away with), to approved PF (not exceeding 12% of salary), interest credited to approved fund not to be included in salary.

Only actual rent from house property to be taxed. Present system of taxing notional value called 'annual value' proposed to be done away with.

Interest on loan taken to repay housing loan deductible in calculating income from house property. This is in line with judicial interpretations.

Rent received in arrears to be included in the year of receipt, whether person in owner of property or not, after allowing 20% deduction towards repairs & maintenance.

Consideration received from transfer of carbon credits to be taxed as business income.

Remission or cessation of any liability by way of loan/deposit/advance/credit to be taxed as business income.

Scientific Research and Development in house facility expenses - weighted deduction proposed to be increased from 150% to 200%.

Transfer of land of a sick industrial company made under a scheme sanctioned under section 18 of SICA where such company is being managed by worker's co-operative not to attract capital gains tax.

Reverse mortgage under notified scheme to continue to be exempt from capital gains tax.

Exemption for long-term capital gains from equity shares/units of equity oriented mutual funds retained. STT to be retained.

Short-term capital gains (where equity shares/units are held for 1 year or less) - deduction of 50% to be are allowed and balance 50% taxed. Likewise short-term capital loss to be scaled down by 50%.

Deduction for interest on housing loan/loan taken for repair or renovation of house property upto limit of Rs. 1,50,000 in respect of one house pro-perty not let out. No deduction for re-payment of principal under the Code.

Limit for tax audits for professionals increased from Rs. 15 lakhs to Rs. 25 lakhs. Limit for tax audit for business increased from Rs. 60 lakhs to Rs. 1 crore.

TDS of 10% on payments in respect of life policies which are not exempt from tax from code.

Amount received by employee from NPS trust is tax-free. Thus, NPS which is taxed on EET basis is proposed to be made EEE (Exempt-Exempt-Exempt) for employees.

MAT rate - Increased from 15% of book profits to 20%. MAT Credit carry forward period increased from 10 years to 15 years.

DDT on dividend of domestic company - 15%.

DDT on incomedistributed by mutual fund/life insurance to unitholder/policy holder - 5%

Wealth tax - threshold increased from Rs. 30,00,000 to Rs. 1 crore. Tax rate will be 1% of net wealth in excess of Rs. 1 crore.

Direct Taxes Code : Tax Tables

I. TAX PAYABLE AT VARIOUS LEVELS OF INCOME BY INDIVIDUALS (OTHER THAN WOMEN AND SENIOR CITIZENS) AND HUFs

Income	Tax liability under the Act (excluding EC and SHEC) (Rs.)	Tax liability under the Code (excluding EC and SHEC) (Rs.)	Tax savings (Rs.)
200000	4,000	0	4000
300000	14,000	10,000	4000
400000	24,000	20,000	4,000
500000	34,000	30,000	4000
600000	54,000	50,000	4000
700000	74,000	70,000	4000
800000	94,000	90,000	4000
900000	124,000	110,000	14000
1000000	154,000	130,000	24000
1100000	184,000	160,000	24000
1200000	214,000	190,000	24000
1300000	244,000	220,000	24000
1400000	274,000	250,000	24000
1500000	304,000	280,000	24000
1600000	334,000	310,000	24000
1700000	364,000	340,000	24000
1800000	394,000	370,000	24000
1900000	424,000	400,000	24000
2000000	454,000	430,000	24000
2100000	484,000	460,000	24000
2200000	514,000	490,000	24000
2300000	544,000	520,000	24000
2400000	574,000	550,000	24000
2500000	604,000	580,000	24000
2600000	634,000	610,000	24000
2700000	664,000	640,000	24000
2800000	694,000	670,000	24000
2900000	724,000	700,000	24000
3000000	754,000	730,000	24000
3100000	2,854,000	2,830,000	24000

II. TAX PAYABLE AT VARIOUS LEVELS OF INCOME BY WOMEN RESIDENT IN INDIA AND NOT ATTAINED THE AGE OF 65 YEARS DURING THE FINANCIAL YEAR

Income	Tax liability under the Act (excluding EC and SHEC) (Rs.)	Tax liability under the Code (excluding EC and SHEC) (Rs.)	Tax savings (Rs.)
1,90,000	0	0	0
2,00,000	1,000	0	1000
3,00,000	11,000	10,000	1000
4,00,000	21,000	20,000	1000
5,00,000	31,000	30,000	1000
6,00,000	51,000	50,000	1000
7,00,000	71,000	70,000	1000
8,00,000	91,000	90,000	1000
9,00,000	121,000	110,000	11000
10,00,000	151,000	130,000	21000
11,00,000	181,000	160,000	21000
12,00,000	211,000	190,000	21000
13,00,000	241,000	220,000	21000
14,00,000	271,000	250,000	21000
15,00,000	301,000	280,000	21000
16,00,000	331,000	310,000	21000
17,00,000	361,000	340,000	21000
18,00,000	391,000	370,000	21000
19,00,000	421,000	400,000	21000
20,00,000	451,000	430,000	21000
21,00,000	481,000	460,000	21000
22,00,000	511,000	490,000	21000
23,00,000	541,000	520,000	21000
24,00,000	571,000	550,000	21000
25,00,000	601,000	580,000	21000
26,00,000	631,000	610,000	21000
27,00,000	661,000	640,000	21000
28,00,000	691,000	670,000	21000
29,00,000	721,000	700,000	21000
30,00,000	751,000	730,000	21000
1,00,00,000	2,851,000	2,830,000	21000

III. TAX PAYABLE AT VARIOUS LEVELS OF INCOME BY SENIOR CITIZENS (I.E. INDIVIDUALS RESIDENT IN INDIA AND ATTAINED THE AGE OF 65 YEARS OR MORE ANYTIME DURING THE FINANCIAL YEAR)

Income	Tax liability under the Act (excluding EC and SHEC) (Rs.)	Tax liability under the Code (excluding EC and SHEC) (Rs.)	Tax savings (Rs.)
2,40,000	0	0	0
2,50,000	1,000	0	1000
3,00,000	6,000	5,000	1000
4,00,000	16,000	15,000	1000
5,00,000	26,000	25,000	1000
6,00,000	46,000	45,000	1000
7,00,000	66,000	65,000	1000
8,00,000	86,000	85,000	1000
9,00,000	116,000	105,000	11000
10,00,000	146,000	125,000	21000
11,00,000	176,000	155,000	21000
12,00,000	206,000	185,000	21000
13,00,000	236,000	215,000

Direct Taxes Code : TDS Tables

Sr. No.	Nature of Payment	Rates of TDS where deductee is a resident		Remarks
		The present rates	Proposed rates under the Code
1.	Salary paid to employees	Rates as per the slabs and rates prescribed by the Finance Act	Average rate of tax on salary paid during the financial year	__
2.	Payment in respect of works contract	1% (where deductee is individual/HUF) 2% (where deductee is person other than individual/HUF)	2%	__
3.	Payment in respect of any service contract	__	2%	__
4.	Payment in respect of broadcasting and telecasting/advertising	1% (where deductee is individual/HUF) 2% (where deductee is person other than individual/HUF)	2%	__
5.	Supply of labour for carrying out any works, or service contract	1% (where deductee is individual/HUF) 2% (where deductee is person other than individual/HUF)	2%	__
6.	Payment in respect of carriage of goods and passengers by any mode of transport other than railways	1% (where deductee is individual/HUF) 2% (where deductee is person other than individual/HUF)	2% (No deduction of TDS in case of carriage of goods by road if deductee furnishes PAN)	__
7.	Interest	10%	10%	__
8.	Dividend other than dividend on which DDT is payable	10%	10%	__
9.	Commission, brokerage, remuneration or prize (by whatever name called) for rendering any services	10%	10%	__
10.	Fees for professional or technical services	10%	10%	__
11.	Payment for royalty or non-compete fees	10%	10%	__
12.	Compensation on compulsory acquisition of immovable property other than agricultural land	10%	10%	__
13.	Rent for the use of machinery or plant or equipment	2%	2%	__
14.	Rent for use of land or building (including factory building) or land appurtenant to a building (including factory building) or furniture or fittings	10%	10%	__
15.	Winning from any lottery or crossword puzzle or card game or other game of any sort	30%	30%	__
16.	Winnings from any horse race	30%	30%	__
17.	Income distributed by mutual fund on which income distribution tax is not paid	__	10% (where deductee is individual/HUF) 20% (where deductee is person other than individual/ HUF)	Threshold for not deducting TDS-where payment to unitholder does not exceed Rs. 10,000 in any financial year. TDS proposed to be introduced for 1st time. No TDS in 1961 Act at present on this payment.
18.	Payment by a life-insurer where payment under life policy is not tax-exempt	__	10% (where deductee is individual/HUF) 20% (where deductee is person other than individual/HUF)	Threshold for not deducting TDS-where payment to policyholder does not exceed Rs. 10,000 in any financial year. TDS proposed to be introduced for 1st time. No TDS in 1961 Act at present on this payment.