Dreaming about international travel? Union Budget just made it cheaper!

Under the new provisions, TCS on overseas tour packages has been reduced from the earlier 5–20% range to 2%, without any threshold amount.

Additionally, TCS under the Liberalized Remittance Scheme (LRS) for education and medical purposes has also been lowered from 5% to 2%.

The Ministry of Finance further stated, “It is proposed that the supply of manpower services be brought within the ambit of payment to contractors for the purpose of TDS. TDS on these services will be at a rate of either 1% or 2% only.”

To simplify compliance for small taxpayers, a rule-based automated system will enable obtaining a lower or nil deduction certificate, removing the need to file an application with the assessing officer. The time for revising tax returns has been extended from 31 December to 31 March, subject to a nominal fee, while the timeline for filing returns will be staggered to ease processes.

To address practical challenges for young professionals and students, a one-time six-month foreign asset disclosure scheme will be introduced. This will allow students, young professionals, tech employees, relocated NRIs, and others to disclose income or assets below a specified threshold.