July is set to be a busy month. Besides being the time when the newly elected government presents its first Union Budget, it is also the deadline for income tax filing.
Here's how July could impact your money and finances.
Budget impact
In June, the National Democratic Alliance (NDA), led by the Bharatiya Janata Party (BJP), formed the government. Finance Minister Nirmala Sitharaman is expected to announce the Union Budget 2024 in July.
These announcements could influence your finances. For example, while the government increased the tax rebate limit from Rs 5 lakh to Rs 7 lakh under the new tax regime last year, experts suggest there is potential for raising the basic exemption limit under both tax regimes.
There is also anticipation for increased deductions on medical expenses. With healthcare costs rising, taxpayers hope for higher deductions for health insurance premiums and medical expenses to better reflect current realities.
Currently, taxpayers can claim deductions of up to Rs 25,000 per year for health insurance premiums paid for self and family, and for parents under Section 80D. This limit increases to Rs 50,000 for senior citizens. It's important to note that Section 80D benefits are only available under the old income-tax regime.
The Pension Fund Regulatory and Development Authority (PFRDA) is advocating for an increase in the tax-free cap on employers' contributions to the National Pension System (NPS) from 10 percent to 12 percent of basic salary and dearness allowance for private sector employees.
Investors are seeking relaxed taxation rules on debt mutual funds and have requested a separate tax deduction category for life insurance premiums, as the Section 80C basket is overcrowded with other tax-saving options. Additionally, there is a long-standing demand for tax-free status on annuity income.
Prepare to file your income tax returns for FY 2023-24.
While you have until the end of July to file your income tax returns for the assessment year 2024-25, it’s wise to start the process early. This helps avoid issues like I-T return portal glitches or heavy traffic closer to the due date. Filing early can prevent the last-minute rush and reduce the chances of mistakes.
SEBI makes nomination optional for joint mutual fund accounts.
The market regulator SEBI issued a circular on June 10, stating that it will not freeze mutual fund portfolios and demat accounts of investors for non-submission of nominations.
This decision, applicable to existing investors and unitholders, was taken following representations from market participants who emphasized the need for easier compliance and investor convenience.
According to SEBI's circular, investors holding securities in physical form will still be eligible to receive dividends, interest payments, and redemption payments, as well as lodge grievances.
In December, SEBI had extended the deadline for mutual fund investors to complete or update their nominations to June 30. However, investors no longer need to worry about their funds being frozen in July.
Axis credit cards will replace Citibank credit cards
The migration process of transferring Citi credit cards to Axis Bank is scheduled to be finalized by July 15. Axis Bank has introduced new card options to transition Citi credit card holders to their services while offering similar benefits. Following the migration, the card details such as pin, number, expiry date, and CVV will remain unchanged from the existing Citi cards.
Moreover, the billing cycle, statement generation date, and payment due date will also remain consistent. Your reward points from all banking products will be merged and accessible through the Axis Bank mobile banking app and Axis Bank Edge rewards portal post-migration. The interest rates for statements produced after the migration will align with those of Axis Bank.
YES Bank changes lounge access policy for credit cardholders.
Starting from July 1, YES Bank credit cardholders will now have the opportunity to enjoy complimentary domestic lounge access by spending Rs 35,000 or more in a calendar quarter. This means that qualifying spending in the previous quarter will grant access for the following quarter. The bank has raised the spending threshold from Rs 10,000 to Rs 35,000 per calendar quarter.
The eligible quarters for meeting this spending requirement are March 21 to June 20, June 21 to September 20, September 21 to December 20, and December 21 to March 20 (in 2025).
Cardholders who fulfill this criteria will receive lounge access benefits in the subsequent quarter. This updated system is applicable for the quarters spanning from July 1 to September 30, October 1 to December 31, January 1 to March 31 (in 2025), and April 1 to June 30 (in 2025).
The credit cards covered by this offer are YES Marquee, YES SELECT, YES Reserv, YES First Preferred, YES Bank ELITE, YES BYOC, and YES Wellness Plus.
HSBC Bank does not include specific types of merchants for earning reward points
Attention HSBC Bank credit cardholders: starting from July 1, some credit card transactions will no longer earn reward points. This change applies to transactions such as those related to education and government, insurance premiums, loading e-wallets, fuel purchases, tax payments, utility bills, and others.