Income Tax Bill, 2025: Tax exemption will continue for trust on anonymous donation, deadline
Lok Sabha In the new Income Tax Bill passed on Monday, some new amendments have also been included along with maintaining several important provisions of the current law. In the Income Tax (Number 2) Bill, the tax exemption received on TDS (tax deduction at source) claims and all religious and charitable trusts have been maintained with tax exemption on anonymous donations. In February this year, it was proposed to remove these provisions in the original Income Tax Bill introduced in Parliament.
What are the changes in the new income tax bill
The provision of the Income Tax (Number 2) Bill has been adopted by adding the word ‘profession’ to such professionals, whose annual receipts are more than Rs 50 crore, the facility to adopt the prescribed electronic payment medium. In addition, the provisions related to taking forward income deficit and adjusting have been renewed to better introduce the provisions. Apart from this, the deadline for filing details of reform in TDS claims has also been reduced to two years, which was six years in the Income Tax Act, 1961.
Complaints expected to reduce significantly
Sources in the Central Board of Direct Taxes (CBDT) said, “This provision is expected to reduce the complaints of tax deducted units significantly.” Almost all the recommendations made in the report submitted by the Select Committee on July 21 have been placed in the Income Tax (No. 2) Bill, which is going to replace the Income Tax Act, 1961. The original Income Tax Bill, 2025 was sent to the Select Committee.
Registered NPO will also get tax exemption
The Select Committee had suggested the restoration of the provisions of the Income Tax Bill 1961 regarding taxation on donations to non-profit organizations (NPOs) or charitable trusts. In the case of anonymity donation received by non-profit organizations (NPOs), registered NPOs with both religious and charitable objectives will also get tax exemption. However, a religious trust will be taxed according to the law, which also does other charitable work like running hospitals and educational institutions.
The concept of receipts was changed with the concept of income
Sources said, “The bill has been associated with the current provisions of the Income Tax Act, 1961 in the Bill. Now exemption has also been provided to registered non-profit organizations with mixed objectives.” Along with this, a provision has been made to impose tax on the actual income of the NPO using the word “income”. Sources said, “The concept of receipts in the Income Tax Act, 1961 have been replaced with the concept of income.”
People will be able to claim refund even after deadline
The bill gives relief to those who want to take TDS refund despite not being compulsory to file ITR within the stipulated time. The earlier proposed bill provided that the taxpayer would have to file income tax returns within the stipulated date to get TDS refund. But it has been replaced on the suggestion of the Select Committee.
Now people who are not obliged to file ITR, will be able to claim TDS refund even after the scheduled deadline has passed. The bill also includes provisions related to tax exemption to customers of Integrated Pension Scheme (UPS). Apart from this, the new system of wholesale assessment in income tax search cases and some direct tax benefits to Saudi Arabia’s Public Investment Fund have also been included.
With PTI inputs
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