6 key financial changes this July that can impact your wallet

Initiate the tax filing process sooner for assessment year 2024-25 instead of waiting till July 31.

July is expected to buzz with unusual activity. Apart from being the month of presentation of the first Union Budget of the newly elected government, the last date for income-tax filing also falls this month.

Here is how July can impact your money and finances.

Budget impact 

In June, the National Democratic Alliance (NDA), led by the Bharatiya Janta Party (BJP), formed the government. Finance minister Nirmala Sitharaman is expected to announce the Union Budget 2024 in July.

Some announcements could impact your finances. For instance, while the government raised the tax rebate limit from Rs 5 lakh to Rs 7 lakh under the new tax regime last year, there is a case for increasing the basic exemption limit under both tax regimes, experts said.

Then, there is the expectation of more deductions on medical expenses. With rising medical costs, taxpayers are hoping for a hike in deductions for health insurance premium payments and medical expenses that are more in line with ground realities.

Currently, taxpayers can claim deductions of up to Rs 25,000 per year each for health insurance premiums paid for self and family and for parents under Section 80D. The deduction limit is Rs 50,000 in the case of senior citizens. To be sure, Section 80D benefits are only available in the old income-tax regime.

The Pension Fund Regulatory and Development Authority (PFRDA) wants the tax-free cap on employers’ contribution to the National Pension System (NPS) to be increased to 12 percent of basic salary and dearness allowance, if any, from 10 percent for private sector employees.

Investors want relaxed taxation rules on debt mutual funds and have demanded a separate tax deduction bucket for life insurance premiums as the Section 80C basket is overcrowded with other tax-saver avenues. Tax-free status for annuity income is another long-standing demand.

Get ready to file your income-tax returns for FY 2023-24

While you have time till the end of July to file your income-tax returns for assessment year 2024-25, it is better to initiate the process sooner, instead of waiting till July 31, to ensure that any I-T return filing portal glitches or heavy traffic closer to the due date do not hamper this exercise. Filing returns early prevent last-minute rush and consequent mistakes.

SEBI makes nomination optional for joint mutual fund portfolios

Market regulator Sebi issued a circular on June 10, stating that it will not freeze the mutual fund portfolios and demat accounts of investors for non-submission of nominations.

The decision - for existing investors and unitholders - was taken after representations from market participants, citing the need for ease of compliance and investor convenience.

Investors holding securities in physical form shall be eligible for receipt of dividend, interest payment or redemption payment, as well as to lodge grievances, Sebi's circular said.

Sebi had, in December last, extended the deadline until June 30, for mutual fund investors to complete/update their nominations. However, investors need not worry their funds getting frozen in July now.

Also read | 5 best debit cards designed to fetch you the travel benefits

Citibank credit cards to become Axis credit cards

The migration of Citi credit cards to Axis Bank will be completed by July 15. Axis Bank has already launched some new card variants to migrate Citi credit card users to Axis Bank with almost the same benefits. Post migration, the card pin, number, expiry date and CVV of existing Citi cards would remain the same.

Additionally, the billing cycle, statement generation date and payment due date will remain the same. Your reward balances across all banking products will be consolidated and can be viewed on the Axis Bank mobile banking app and Axis Bank Edge rewards portal after migration. Interest for the statement generated after migration will be as per Axis Bank rates.

YES Bank alters lounge access policy for credit cardholders

Effective July 1, YES Bank credit cardholders will be able to unlock complimentary domestic lounge access by spending Rs 35,000 or more in a calendar quarter. It means that spending made in the preceding quarter will unlock access for the subsequent quarter. The bank has increased the spending threshold to Rs 35,000 from Rs 10,000 in the calendar quarter.

The specified quarters for meeting this spending threshold are March 21 to June 20, June 21 to September 20, September 21 to December 20, and December 21 to March 20 (in 2025).

Users meeting this criterion will get lounge access benefits in the subsequent quarter. This revised structure applies to the quarters spanning July 1 to September 30, October 1 to December 31, January 1 to March 31 (in 2025), and April 1 to June 30 (in 2025).

The credit cards include YES Marquee, YES SELECT, YES Reserv, YES First Preferred, YES Bank ELITE, YES BYOC, and YES Wellness Plus.

Also read | HDFC Bank has revised terms for credit cards: Here are the key changes

HSBC Bank excludes certain merchant categories for reward points

HSBC Bank credit cardholders, note: effective July 1, certain credit card transactions will not be eligible for accrual of reward points. They include education and government-related transactions, insurance premiums, loading amount in e-wallets, fuel transactions, tax payments, utility transactions and more.