Money rules: Key financial updates for taxpayers, UPI users, investors for January 2025; check details

Financial updates 2025: The first month of the new year will witness a number of financial changes that would affect many investors and taxpayers. While on the one hand, CBDT has extended the IT filing deadline to January 15, 2025, on the other hand,  the Reserve Bank of India (RBI) has implemented fresh guidelines for fixed deposits (FDs) with Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs). Furthermore, banks have announced the introduction of minimum spending requirements for credit cardholders seeking access to airport lounges.

A quick look at the key updates this month:

CBDT extends ITR filing deadline

The Central Board of Direct Taxes (CBDT) has extended the deadline for resident individuals to file belated and revised Income Tax Returns (ITRs) for assessment year (AY) 2024-25 has been extended by the Central Board of Direct Taxes (CBDT). The new deadline is January 15, 2025, compared to the previous deadline of December 31, 2024.

RBI's new rules for FDs

The Reserve Bank of India (RBI) recently released updated guidelines for Fixed Deposits (FDs) with Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), effective January 1. The notable revisions focus on premature withdrawal regulations. 
Individuals with small deposits valued at up to Rs 10,000 may withdraw the full amount within three months of depositing, sans any interest charges. 
Conversely, for larger deposits, depositors are permitted to make partial withdrawals of up to 50 percent of the principal sum or Rs 5 lakh (whichever is lower) within a three-month period, also exempt from interest. 
Moreover, in the event of a serious illness, clients have the option to prematurely withdraw the entire principal amount without incurring any interest, regardless of the deposit tenure. 
Besides, NBFCs are now obligated to notify depositors of maturity details a minimum of two weeks prior to the maturity date, ensuring more prompt and transparent communication.

UPI 123Pay transaction limit

The National Payments Corporation of India (NPCI) has decided to raise the limit for UPI 123Pay from Rs 5,000 to Rs 10,000, as per the NPCI circular dated October 25, 2024. This decision follows the Reserve Bank of India's (RBI) press release on October 9, 2024, titled 'Statement on Development and Regulatory Policies,' in which RBI announced the increase of the per transaction limit for UPI 123Pay from Rs 5,000 to Rs 10,000. This adjustment is expected to have a positive impact on feature phone users in India who face challenges in accessing the internet.

New tax rules for FY26

The majority of the income tax amendments outlined in Budget 2024 will come into effect during the ongoing fiscal year 2024-25. These adjustments will also have implications on the available tax deductions and exemptions that can be applied when submitting an income tax return (ITR) in July 2025.

The applicable tax slabs for New Tax Regime, which were revised by Finance Minister Nirmala Sitharaman, are:

Up to Rs 3 lakh - 0%
Rs 3 lakh to Rs 7 lakh - 5%
Rs 7 lakh to Rs 10 lakh - 10%
Rs 10 to Rs 12 lakh - 15%
Rs 12 to Rs 15 lakh - 20%
Above Rs 15 lakh - 30%

Lounge access policy for RuPay card users

Starting January 1, a new lounge access policy will be implemented for RuPay credit card holders in Delhi. The policy is based on cardholders' spending habits, with complimentary lounge access granted based on their spending in the previous quarter.

The spend-based tiers for lounge access are as follows: spending between Rs 10,000 and Rs 50,000 qualifies for two complimentary visits per quarter (Tier 1). Those who spend more than Rs 50,000 to Rs 1 lakh will receive four complimentary visits (Tier 2). Higher spending tiers offer even more lounge visits: spending between Rs 1 lakh and Rs 5 lakh (Tier 3) earns eight visits, and spending above Rs 5 lakh (Tier 4) offers unlimited complimentary visits per quarter. This lounge access policy is applicable to select RuPay credit card variants, including Select, Platinum, and higher variants.

Updation of credit records

From January 1, 2025, banks and financial institutions will increase the frequency of updating credit records, as outlined in the August 2024 monetary policy. Rather than the current monthly updates, credit data will now be refreshed every two weeks (specifically on the 15th and the last day of the month), or at shorter intervals as agreed upon by both credit institutions and credit information companies.

BOBCARD revisions

BOBCARD will be implementing updates to its credit card terms and features starting January 1. The cap of 500 reward points per statement cycle on UPI transactions has been removed. Additionally, the bank has revised its tariff of charges on credit cards. 

Besides, cardholders will incur a 1% processing fee on wallet loading, utility transactions exceeding Rs 50,000 (capped at Rs 3,000 per transaction), and fuel transactions above Rs 10,000. However, HPCL ENERGIE BOBCARD holders will not be subject to the processing fee on fuel transactions.

Furthermore, BOBCARD holders can enjoy complimentary domestic airport lounge access if they meet the minimum spending requirement in the previous quarter. The minimum spending threshold varies depending on the card type, such as Rs 40,000 for the Eterna credit card and Rs 20,000 for Varunah Premium and Premier credit cards in the preceding quarter.

Investment submission for FY25

Employers typically request employees to provide evidence of tax-saving investments made in the previous financial year by January. It is advisable to incorporate tax planning into your overall financial strategy starting in April, rather than waiting until the last minute before declaring. Missing the deadline set by your employer may result in higher taxes being withheld from your salary in the months of January, February, and March. 

While you can claim a refund for excessive taxes withheld when filing your returns in July, timely declarations can help prevent a cash shortage in the final quarter of the financial year. Be cautious not to rush into making investments and ensure that deductions such as Employees' Provident Fund (EPF), home loan repayments, or children's school fees do not exceed the Rs 1.5 lakh limit under section 80C in the old tax regime.

You have to furnish investment proofs for tax deduction and exemption under the Old Tax Regime.