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Highlights of Important Provisions of Budget 2021

1) No Change in the Tax Rates under Normal or alternative Taxation Regime

2) W.e.f AY 2021-22, No Depreciation would be allowed on Goodwill of Business or Profession

3) Under Section 80EEA the last date of the Sanction of the loan has been extended to 31.3.22. It should be noted that 80EEA provides for additional deduction on Interest on Housing Loan

4) Under Sec 80-IAC an eligible startup can deduction of 100% of profits for 3/10 years if incorporated up to 1st April 2021. The time limit for incorporation extended to 31.03.2022

5)T/L for processing of returns shall be reduced from 1 year to 9 months from the end of FY in which ROI is filed

6) T/L for issue of notice u/s 143(2) stands reduced to 3 months from the end of FY in which ROI is filed as against 6M earlier

Budget 2021   A birds eye view of important provisions

7) T/L for assessment u/s 143(3) and 144 stands reduced to 9M from end of relevant AY

8) T/L for issuance of Notice u/s 148 stands reduced to 3 years from end of AY as against 6 years earlier

9) T/L for filing belated/revised return stands reduced to Dec of AY as against end of AY earlier

10) Clarified that Sec 44ADA is N.A for LLPs

11)Variation between SDV and agreement value on the date of agreement increased to 20% from 10%

12) Residents Individuals aged 75 years or above are not required to file ROI if having only Pension Income and Interest Income and Bank deducts TDS


13) No deduction shall be allowed for the Employees contribution to the EPF/ESI if not deposited up to due date. It should be noted that due date here means the due date as specified in relevant act and not due date u/s 139(1)

14) Now even appeals to ITAT can be filed in a faceless manner

15) Tax Audit related amendment: The threshold has been increased to 10 crores provided the Cash Receipts and Cash Payments does not exceed 5% of total receipts/ total payments respectively

16) Interest u/s 234C shall not be levied if a delay in deposit of the Advance tax liability is attributed to Dividend Income

17) Section 206AB to be introduced where TDS shall be higher of rate specified in the act, 2* rate or 5% where deductee has not filed ITR for previous 2 AYs and TDS amount exceeds 50000/- in each year

18) Section 206CCA in case of TCS to be introduced in line with the above section with same conditions


19) Provisional attachment of property in case of fake invoices/false entry in books etc.

20) Sec 35 of CGST stands omitted to remove the mandatory requirement of getting annual accounts audited and reconciliation statement to be submitted by CA/CMA- GSTR 9C

21) Section 44 of the CGST Act accordingly stands substituted to incorporate the above omission of Sec 35

22) Sec 50 of the CGST Act is being amended to provide that the interest shall be levied on the Net Tax Liability w.e.f 1.07.2017

23) New clause to be introduced Sec 16 of IGST so as to provide that ITC on invoice or debit note may be availed only if same have been furnished in the statement of outward supplies by supplier

I have tried my level best to present the provisions correctly based on my understanding of the Finance Bill 2021. Please feel free to inform in case you find any errors

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Category Union Budget, Other Articles by - CA Rohit kapoor