Explanatory Notes to provisions of the Finance Act, 2022
1. Introduction
1.1 The Finance Act, 2022 (hereafter referred to as 'FA 2022') as passed by the Parliament, received the assent of the President on 30lh March, 2022 and has been enacted as Act No.6 of 2022.
1.2 This circular explains the substance of the provisions of the FA 2022 relating to direct taxes.
2. Changes made by FA 2022
2.1 The FA 2022 has,-
(i) specified the existing rates of income-tax for the assessment year 2022-23 and the rates of income-tax on the basis of which tax has to be deducted at source and advance tax has to be paid during financial year 2022-23; and
(ii) amended sections of the Income-tax Act, 1961 ('the Act').
3. Rate structure
3.1 Rates of income-tax in respect of incomes liable to tax for the assessment year 2022-23.
3.1.1 Part I of First Schedule to the FA 22 specifies the rates of income-tax in respect of incomes of all categories of assessees liable to tax for the assessment year 2022-23. These rates are the same as those laid down in Part III of the First Schedule to the Finance Act, 2021 for the purposes of computation of "advance tax", deduction of tax at source from "Salaries" and charging of tax payable in certain cases during the financial year 202 1-22. Main features of the rates specified in the said Part I are as follows:
3.1.2 Individual, Hindu undivided family, association of persons, body of individuals or artificial juridical person.
Paragraph A of Part I of the First Schedule specifies the rates of income-tax in the case of every individual, Hindu undivided family (HUF), association of persons, body of individuals or artificial juridical person (other than a co-operative society, firm, local authority and company) as under:
To know more in details, find the enclosed circular
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