April 1 Rule Changes: Who Wins And Who Loses in the New Financial Year?

As the new financial year begins on April 1, several key changes will take effect, impacting your finances from day one. Updates in credit card benefits, UPI transactions, tax regulations, and mutual fund investments will come into force. Here's a breakdown of the significant changes that may affect you directly or indirectly.

Mutual Funds

Under the new SEBI regulations, fund houses must deploy funds raised through New Fund Offers (NFOs) within 30 business days. If an Asset Management Company (AMC) fails to invest within this period, it can request a one-time extension of 30 days with Investment Committee approval. If no investment is made within 60 days, the AMC must halt new investments and allow investors to exit without penalty.

Specialized Investment Funds (SIFs)

SEBI has introduced a new investment category called Specialized Investment Funds (SIFs), positioned between mutual funds and Portfolio Management Services (PMS). Investors must commit a minimum of ₹10 lakh to these funds. Only AMCs with an average Asset Under Management (AUM) exceeding ₹10,000 crore over the last three years are eligible to launch SIFs.

Unified Pension Scheme (UPS)

The government will roll out the Unified Pension Scheme (UPS) under the National Pension System (NPS) starting April 1, 2025. This scheme is exclusively for central government employees and guarantees a pension based on service length. Employees with at least 25 years of service will receive 50% of their last 12 months' average basic salary as a pension.

UPI Transactions and Mobile Number Updates

The National Payments Corporation of India (NPCI) has directed banks and payment service providers (PSPs) to update their databases by March 31, 2025, removing recycled or closed mobile numbers. If your mobile number is deactivated or revoked by the Department of Telecommunications (DoT), your bank and UPI app may remove it from their records, disrupting UPI services. To prevent issues, ensure your bank account is linked to an active mobile number.

Credit Card Changes

Credit card policies will vary by bank:

SBI Card:

SimplyCLICK SBI cardholders will now earn 5X reward points on Swiggy instead of 10X.

Reward points on Myntra, BookMyShow, and Apollo 24|7 will continue.

Air India SBI Platinum Credit Card users will see a 33% reduction in reward points for Air India ticket bookings.

IDFC First Bank:

From March 31, 2025, the bank will discontinue milestone benefits for the Club Vistara Credit Card and gradually phase out the card.

New Income Tax Structure

The government has raised the tax-free income threshold under the new tax regime from ₹7 lakh to ₹12 lakh, benefiting middle-income groups.

• Individuals earning up to ₹12 lakh annually will pay zero tax.
• A ₹75,000 standard deduction will be available for salaried individuals, effectively making a salary of up to ₹12.75 lakh tax-free.
• Revised tax slabs will apply under the new tax regime.

Tax Relief for Senior Citizens

The tax deduction limit on interest income for senior citizens has increased from ₹50,000 to ₹1 lakh.

The TDS exemption threshold on rental income for senior citizens has been raised from ₹2.4 lakh to ₹6 lakh per year.