3 rule changes that will impact your money from August 1

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There are a few rule changes which will come into effect from August 1 that will impact the average person’s personal finances. Here is a look at them.

NACH system to be available on all days

The Reserve Bank of India (RBI) has announced that the National Automated Clearing House (NACH) system will be available on all days, including Sundays and bank holidays, effective from August 1, 2021.

NACH is a bulk payment system operated by NPCI which facilitates one-to-many credit transfers, such as payment of dividend, interest, salary, pension, and also collection of bill payments pertaining to electricity, gas, telephone, water, periodic instalments towards loans, investments in mutual funds, insurance premium, etc.

At present, auto-debit instructions given by the bank account holder does not get processed on days the bank is closed like Sundays, bank holidays and even gazetted holidays. Further, since most companies use NACH for salary credits these also do not happen on bank holidays.

From August 1, your salary credit into your bank account, auto-debits related to mutual fund SIPs, home/car/personal loans EMI payments, bill payments such as telephone bills, gas payments, electricity bills etc. will take place even on bank holidays.

Penalty on self-assessment tax dues above Rs 1 lakh

A government press release issued on May 20, 2021, stated that if an individual taxpayer’s tax dues, after subtracting TDS and advance tax dues, exceeds Rs 1 lakh for FY 2020-21, then the payment must be made on or before July 31, 2021. The penal interest, as per under 234A of the Income-tax Act, 1961, will be levied at the rate of 1 per cent per month from August 1, 2021, till the date of filing of ITR.

The press release clarified that if senior citizens (who are not required to pay advance tax as per income tax laws) pay any taxes before July 31, 2021, then the taxes paid will be treated as advance tax. Further, if due to this the final tax liability goes below Rs 1 lakh, then penal interest will not be levied under section 234A.

However, such relief has not been provided for individuals aged below 60 years. Therefore, they need to pay all their tax dues if it exceeds Rs 1 lakh to avoid penal interest from August 1.

Revision in ICICI Bank transaction charges

According to ICICI Bank’s website, the service charges of various transactions of regular savings account will be revised from August 1, 2021. Here is a look at some of the revisions according to the website:

Cash transaction charges
Value limit (sum total of deposits and withdrawals) the value limit is inclusive of both Home and Non home branch transactions.
a) Home Branch (Branch where account is opened or ported)
Rs 2 lakh. (w.e.f Aug 01, 2021 – Rs 1 lakh) Free per month per account.
Above Rs 2 lakh (w.e.f Aug 01, 2021 – Rs 1 lakh) – Rs 5 per Rs 1,000, subject to a minimum of Rs 150
b) Non-Home branch
No charges for cash transactions value up to Rs 25,000 per day.
Above Rs 25,000 – Rs 5 per Rs 1,000 subject to a minimum of Rs 150
Cheque books
Nil for 20 (w.e.f Aug 01, 2021 – Nil for 25) payable-at-par cheque leaves in a year; Rs. 20 for every additional cheque book of 10 leaves

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