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GPIND: Global Payroll India Legislative Changes for Tax Year 2019-2020 (Doc ID 2502901.1)

Last updated on JANUARY 07, 2020

Applies to:

PeopleSoft Enterprise HCM Global Payroll India
Information in this document applies to any platform.

Details

The intent of this document is to describe solutions for problems or questions related to Global Payroll India Legislative Changes for Tax Year 2019-2020. This solution applies to customers on PeopleSoft Release {9.2}. This is a living document and will be updated as new solutions are created; please review thoroughly on a regular basis.

(Last updated 5th Feb 2019) Summary Table - see below for details:

Please see table below for details.

Legislative Change Effective Date Additional Info P1 Patch Fix Target Date Targeted into PUM Image/Patchset
LEGISLATIVE CHANGES FOR FINANCIAL YEAR 2019-2020 1st April 2019 It is proposed to increase the standard deduction for salaried individuals
from the existing INR 40,000 to INR 50,000 per annum.

Increase in Tax Rebate:

At present, the rebate under section 87A of the ITA was INR 2,500 for
resident individuals whose total income did not exceed INR 350,000 per annum.
It is proposed to increase the rebate to INR 12,500 for resident individuals
whose total income does not exceed INR 500,000 per annum. Accordingly, in
case of resident individuals having total income up to INR 500,000, no tax
will be payable.

Increase in the threshold limit for TDS on interest:

At present, Under Section 194A of Income Tax Act, the existing threshold
limit of INR 10,000 per year for application of TDS on interest earned from
banks, post office and other qualified institutions is proposed to be
increased to INR 40,000 per year


 

Release 9.2:

Patch 29303106

Date: 7th Mar 2019

PUM Image 30

 

FORM 16: NEW FORMAT FOR SALARY TDS CERTIFICATE 12th May 2019

The new format for Form 16 was notified by the Central Board of Direct Taxes

(CBDT) via a notification dated April 12, 2019. The format specified in the

notification comes into effect from May 12, 2019 which is well before the

last date for issue of Form 16 or the TDS certificate for salary by

employers. Therefore, those issuing Form 16 after this date will have to do

so in the new format. This Form 16 will then be used by salaried taxpayers to

file their tax return for FY 2018-19 (AY 2019-20)

 Release 9.2:

Bug 29668678

 
 CERTIFICATE FOR TAX DEDUCTED AT SOURCE IN PART B OF FORM NO. 16  1st April 2019  CBDT has released a notification on 6th May 2019 with regards to Procedure,
format and standards for issuance of certificate for tax deducted at source
in Part B of Form No. 16. All deductor¿s shall be able to issue the TDS
certificate in Part B of Form No. 16 either by generation or via download
through TRACES Portal. The deductor, issuing the TDS certificate in Form No.
16 by downloading it from the TRACES Portal, shall, before issuing to the
deductee authenticate the correctness of contents mentioned therein and
verify the same either by using manual signature or by using digital
signature.

Based on the changes, the employer has two option to generate and issue
Part-B
a) make use of the existing functionality and generate Form-16 as per new
format and made available in Self Service.
b) Download from TRACES portal and place the files in a path in order to make
available via Self Service

Release 9.2:

Bug 29787565

 
REDUCTION OF ESI CONTRIBUTION RATE TO 4% 1st July 2019
The ESI Act, 1948, applies to organisations with 10 or more employees,
drawing a salary of up to ¿21,000. The scheme, which is governed by the
state-administered Employees¿ State Insurance Corporation (ESIC), provides
for medical, cash, maternity, disability, and dependent benefits to the
insured. Effective 1st July 2019, Ministry of Labour issued a notification in
reduction of Contribution from the existing 6.50% (that is Employer 4.75% and
Employee 1.75%) to 4.00% (Employer 3.25% and Employee 0.75%)

Release 9.2:

Bug 29909430

PRP posted

https://support.oracle.com/epmos/faces/PatchResultsNDetails?releaseId=27001300090200&requestId=23002681&patchId=29909430&languageId=0&platformId=2000

NEW FINANCE BILL AMENDMENTS FOR FY 2019-20NEW FINANCE BILL AMENDMENTS FOR FY 2019-20  1st April 2019  Following are the changes which impacts the product -
 
Surcharge (as specified in Part II of the First Schedule to the Finance Act):
 
Surcharge on individuals having taxable income from Rs.200,000,00 crore to
Rs.5,00,000,00 crore; and 5 crore and above will be enhanced. The rates of
surcharge for Individuals/HUFs having higher taxable income are-
 
Taxable income (in INR) Surcharge (%)
>5,000,000 up to 10,000,000 10
>10,000,000 up to 20,000,000 15
>20,000,000 up to 50,000,000 25
> 50,000,000 37
 
Amendment to Section 80C :
 
Central Government employees can now also invest in NPS and avail benefit of
deduction up to Rs.150,000 under section 80C subject to fulfilment of
prescribed conditions.
 
Amendment to Section 80CCD (2):
 
Currently, contribution by Central Government or any other employer to NPS
for its employees is eligible for deduction up to 10 percent of salary. This
is now sought to be increased to 14 percent.
 
Tax relief for affordable housing Under Section 80EEA:
 
Additional deduction up to Rs.1,50,000 will be provided for interest paid on
loans borrowed up to 31st March, 2020 for purchase of house valued up to
Rs.45, 00,000 lakh.
 
Tax deduction for interest paid for purchase of electric vehicle Under
Section 80EEB:
 
An individual can claim deduction up to Rs.150,000 for interest paid towards
loan for purchase of an electric vehicle. The said loan could be availed from
1 April 2019 till 31 March 2023.

Release 9.2:

Bug 30020965

 
FILE FORMAT FOR SALARY TDS FILE - FORM 24Q 1st April 2019 Total Deduction under Section 16 - Greater than or equal to Zero. In case,
value under field no. 6 (i.e. Section 16) is "16(ia)", then value under this
field should be greater than or equal to 0.00 and less than or equal to
40,000.00.
 
Existing value is modified to accommodate Standard Deduction as applicable
from 18-19

Release 9.2:

Bug 29681012

PUM Image 32

PRP posted

FILE FORMAT FOR SALARY TDS FILE - FORM 24Q - Q4 FY 2019-2020

Jan 2020 to March 2020

FY 19-20 (Q4)

Total Deduction under Section 16 - Greater than or equal to Zero. In case,
value under field no. 6 (i.e. Section 16) is "16(ia)", then value under this
field should be greater than or equal to 0.00 and less than or equal to
50,000.00.

Existing value is modified to accommodate Standard Deduction as applicable
from 19-20

Release 9.2:

Bug 30720335

 

To stay up with the legislative changes that will impact your PeopleSoft Application visit <https://blogs.oracle.com/psftlegupdates/>

Actions

 You need to apply the critical patches / GP Updates whenever their legislative fixes are posted.

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