All about Reliefs and Relaxation in compliance related to Income Tax under a situation of COVID-19 pandemic.

Extension of Income- Tax compliance in view of COVID-19 outbreak.

1.  Extension of due date of income tax return for the F.Y 2018-19.

Extension of last date of filing of original as well as revised income-tax returns for the F.Y 2018-19 (AY 2019-20) from 31^st March 2020 to 30^th June 2020.

2. Due dates for making various investment/payment for claiming deduction under income tax for the F.Y 2019-20 has been extended.

Due dates for  making various investment/payment for claiming deduction under Chapter-VIA-B of IT Act which includes Section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim), 80G (Donations), etc. has been extended to 30th June, 2020. Hence the investment/payment can be made up to 30.06.2020 for claiming the deduction under these sections for FY 2019-20.

3. The date for making investment for claiming deduction under capital gain has been extended.

The date for making investment/construction/purchase for claiming roll over benefit/deduction in respect of capital gains under sections 54 to 54GB of the IT Act has also been extended to 30th June 2020. Therefore, the investment/ construction/ purchase made up to 30.06.2020 shall be eligible for claiming deduction from capital gains arising during FY 2019-20.

4. For SEZ units, the date for commencement of operation for claiming deduction under income tax has been extended.

The date for commencement of operation for the SEZ units for claiming deduction under deduction 10AA of the IT Act has also extended to 30.06.2020 for the units which received necessary approval by 31.03.2020.

5. The date of passing or issuance of notice by authorities under various income tax act has been extended.

Issue  of notice, intimation, notification, approval order, sanction order, filing of appeal, furnishing of return, statements, applications, reports, any other documents and time limit for completion of proceedings by the authority  under Income Tax Act,  Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act,  STT law, CTT Law, Equalization Levy law, Vivad Se Vishwas  law  where the time limit is expiring between 20th March 2020  to 29th June 2020 shall be extended to 30th June 2020.

6. Reduction in interest rate from 12% to 9% for delay payment of tax.

For delayed payments of advanced tax, self-assessment tax and  regular tax  made between 20th March 2020  and  30th June 2020,  reduced interest rate  at 9%   instead of 12 % per annum ( i.e. 0.75% per month instead of 1 percent per month) will be charged  for this period.  No late fee/penalty shall be charged for delay relating to this period.

7. Reduction in interest rate from 18% to 9% for delay in deposit of TDS.

For delayed payments of TDS made between 20th March 2020  and  30th June 2020,  reduced interest rate  at 9%   instead of 18 % per annum ( i.e. 0.75% per month instead of 1.5% percent per month) will be charged  for this period.  No late fee/penalty shall be charged for delay relating to this period.

8.  Extension in date of linking of Aadhaar-PAN from 31^st March 2020 to 30^th June 2020.

9. Extension of scheme of Vivad se Vishwas upto 30^th June 2020. No additional 10% amount, if payment made by June 30, 2020.

10. Extension of validity of nil/ lower deduction TDS/TCS certificate till 30^th June 2020 and modification in procedure for filing application for nil and lower deduction certificate.

Extension

·    In case of those assessees who have applied for a nil or lower rate of TDS on the TRACES portal [section 197 / 206C(9)] for FY 2020-21, which are pending disposal as of date and who have been issued a certificate for the preceding FY 2019-20, such certificate shall be applicable till 30 June 2020 for FY 2020-21, or disposal of their applications by the Assessing Officer (AO), whichever is earlier.

·      In case of those assessees who could not apply for FY 2020-21 on the TRACES portal [section 197 / 206C(9)] and who have been issued a certificate for FY 2019-20, such certificate shall be applicable till 30 June 2020 for FY 2020-21. However, such assessees are required to make an application for issue of certificate for FY 2020-21 at the earliest, giving details of transactions, deductor/collector of the TDS/TCS to the AO, as soon as normalcy is restored or 30 June 2020, whichever is earlier as per the modified procedure as detailed hereunder.

·   With respect to payments to non-residents (including foreign companies) having a Permanent Establishment (PE) in India who are not covered by the situations mentioned above (i.e. they do not have an existing lower / nil TDS certificate for the FY 2019-20), tax is to be deducted at 10 percent plus surcharge and cess on payments to be made till 30 June 2020, or disposal of their applications, whichever is earlier.

         Modified procedure:

·  Those assesses who have not applied for Nil or lower TDS/TCS certificate in the TRACES portal and who do not have a certificate for FY 2019-20, are required to make an application as per the modified procedure.

·   The modified procedure for application under sections 197/206C(9) is briefly stated below:

- Applications to be made via email to the concerned AO

- Email should contain the following data and documents:

- Duly filled Form 13 along with Annexure I or III as applicable;

- Details which otherwise are required to be uploaded on TDS-CPC website while filling up

Form 13;

- Projected Balance Sheet (BS) and Profit & Loss (P&L) Account for FY 2020-21;

- Provisional BS and P&L Account for FY 2019-20;

- BS and P&L Account for FY 2018-19;

- Form 26AS for FY 2019-20 & 2018-19

- Income tax Return (ITR) Form for FY 2018-19.

·      The existing process for making applications under section 195(2) and 195(3) will continue to apply except that such applications need to be made via email to the concerned AO. The certificates under the said sections will be issued by email mode.

·      The certificates under the modified procedure shall be issued up to 30 June 2020 or any other date earlier to it, as specified by the AO communicated by email to the applicant containing the following information:

·

Sr no	TAN of the deduct or	PAN of the Deductee	Financial year	Section under which Tax at source is to be deducted / collected	Estimated amount of income / sum to be received / paid	Applicable rate of deduction / collection	Valid From Date	Valid to Date

·       The issuance of certificate shall be communicated to the applicant who in turn shall share the same with the deductor/collector.

11. Lower/nil rate of TDS/TCS applications to be disposed liberally by 27.04.2020.

·      In all the cases where assessees (payees or buyers/licensees/lessees) have timely filed application for lower or nil deduction of TDS/TCS on the TRACES Portal for F.Y.2019-20 and such applications are pending for disposal as on date, the applicant shall intimate, vide an e-mail addressed to the Assessing Officer concerned, the pendency of such applications for FY 2019-20 for the lower/nil deduction/collection certificate under sections 195, 197 or 206C(9) of the Income-tax Act along with the required documents and evidences of filing their application in TRACES Portal.

·    The Assessing Officer shall dispose of the applications by 27.04.2020 and communicate to the applicant regarding the issuance/rejection of certificate vide email. The certificate issued for lower/nil rate TDS or lower TCS shall be applicable for the amount credited/debited during the FY 2019-20 after the date of making of application u/s 195,197 or 206C(9) but remained unpaid or not received till the date of issuance of the certificate by the Assessing Officer.

·    The issuance of certificate shall be communicated to the applicant who in turn shall share the same with the deductor/collector.

12. Form 15G & 15H submitted for FY 2019-20 would be valid up to 30.06.2020.

Form 15 H:- is for taxpayer who are 60 years or older and have income below the taxable limit.

Form 15 G:- is for taxpayer who are below 60 years of age and have income below the taxable limit.

It is important to submit Form 15G/Form 15H to the financial institution (usually banks) to avoid the deduction of tax. Banks usually deduct TDS from the interest income on FDs if it crosses the threshold limit.

To mitigate the hardships of small taxpayers, it has been decided that if a person had submitted valid Forms 15G and 15H to the Banks or other institutions for F.Y. 2019-20, then these Forms would be valid up to 30.06.2020. This will safeguard the small tax payers against TDS where there is no tax liability (Order passed on 03.04.2020).

As per order in case  if a person had submitted valid Forms 15G and 15H to the Banks or other Institutions for F.Y. 2019-20, then these Form 15G and 15H will be valid up to 30.06.2020 for FY 2020-21 also. It is reiterated that the paver who has not deducted tax on the basis of said Forms 15G and 15H, shall require to report details of such payments/credits in the TDS statement for the quarter ending 30.06.2020 in accordance with the provisions of rule 31A(4)(vii) of the Income-tax Rules, 1962.

All pending refunds under Income Tax,GST & custom to be released by department

With a view to provide immediate relief to the business entities and individuals under COVID-19 situation, it has been decided to issue following pending refunds:-

1. All the pending income-tax refunds up to Rs. 5 lakh, immediately. This would benefit around 14 lakh taxpayers.

2.  It has also been decided to issue all pending GST and Custom refunds which would provide benefit to around 1 lakh business entities, including MSME. Thus, the total refund granted will be approximately Rs. 18,000 crore.

(Source : Press release dated 8 April 2020)

How to pay zero income tax for salary income upto Rs. 19 lakh for F.Y 2019-20 ?/ Tax planning tips for the F.Y 2019-20

All about income tax for salaried person for the F.Y 2019-20.

Tax planning tips for salaried individuals for the Financial year 2019-20.

Non-filers for the financial Year 2017-18 identifies through Non-filers Monitoring System (NMS) by CBDT

The Non-filers Monitoring System (NMS) aims to identify and monitor persons who enter into high value transactions and have potential tax liabilities but have still not filed their tax returns. Analysis was carried-out to identify non-filers about whom specific information was available in the database of the Income Tax Department. The sources of information include Statement of Financial Transactions (SFT), Tax Deduction at Source (TDS), Tax Collection at Source (TCS), information about foreign remittances, exports and imports data etc. 

Data analysis has identified several potential non-filers who have carried-out high value transactions in Financial Year 2017-18 but have still not filed Income Tax Return for Assessment Year 2018-19 (relating to FY 2017-18). 

The Department has enabled e-verification of these NMS cases to reduce the compliance cost for taxpayers by soliciting their response online. It is reiterated that there is no need to visit any Income Tax office for submitting response, as the entire process is to be completed online. Taxpayers can access information related to their case from the ‘Compliance portal’ which is accessible through the e-filing Portal of the Department at https://incometaxindiaefiling.gov.in. The PAN holder should submit the response electronically on the Compliance Portal and keep a printout of the submitted response for record purposes. User Guide and FAQs are provided under the “Resources” Menu on Compliance Portal.  

Non-filers are requested to assess their tax liability for AY 2018-19 and file the Income Tax Returns (ITR) or submit online response within 21 days. If the explanation offered is found to be satisfactory, matters will be closed online. However, in cases where no return is filed or no response is received, initiation of proceedings under the Income-tax Act, 1961 will be considered.

(Press release, Dated: 22-01-2019)

Clarification regarding issue of Prosecution Notices -CBDT

The Central Board of Direct Taxes (CBDT) has stated that certain news items that appeared in a section of media regarding enmasse issue of prosecution notices to small companies for TDS default are completely misleading and full of factual inaccuracies. CBDT clarified that Mumbai Income Tax TDS office has issued prosecution Show Cause Notices only in   a limited number of big cases where more than Rs. 5 lakh of tax was collected as TDS from employees etc and yet the same was not deposited with the Income Tax Department in time.

CBDT said that some defaulter companies and vested interests are deliberately misleading the media to thwart action against themselves.  Having deducted tax from employees and other taxpayers and not depositing the same in time in the Government Treasury is an offence punishable under the law. It also affects the interest of the employees from whose salary the tax has been deducted by the unscrupulous employers who have not deposited the same in time in the Government Treasury. If the TDS is not deposited in time, the employee would be ineligible for claiming credit of the tax deducted when he files his own return.

CBDT stated that in last one month, only in 50 big cases prosecution notices have been issued by Mumbai IT TDS office. Out of these, in 80% of the cases the TDS tax default is above Rs. 10 lakh and in 10 % cases, TDS default is between Rs. 5 to Rs.10 lakh. In the remaining 10% cases, TDS default is of more than Rs. 1 crore as detected in the survey. Prosecutions have also recently been launched against 4 big business houses where more than Rs 50 Crore of tax was collected by them from the tax payers and yet not deposited with the Government in time. But such legal and rightful action is being unfortunately projected in the media by the vested interests as if the Department is going overboard to harass small employers. 

It would be pertinent to note that in a country of 130 Crore people where around 6 Crore returns are filed every year, only a total of 1400 prosecutions have been filed so far for various offences under the Income Tax Act during this financial year.  This, by any stretch of imagination, cannot be termed as mass harassment by the income tax department. Therefore, to say that prosecution notices enmasse have been sent to taxpayers for minor defaults is completely incorrect and misleading, the CBDT added.

(Press release dated 21st January 2019)

Statutory Compliance Due Dates January 2019

Due Dates		Description	Who needs to do the compliance
7 January 2019	Income tax	Deposit TDS for the month of December 2018.	All non-government deductor responsible for TDS deduction.
11 January 2019	GST	GSTR-1 for the month of December 2018.	All taxable persons whose turnover exceed Rs. 1.5 crores or opted to file monthly return.
13 January 2019	GST	GSTR-6 for the month of December 2018.	All input service distributers.
15 January 2019	Income tax	TCS return in form 24 G for the month of December 2018.	All person responsible for collecting TCS.
		Quarterly statement of TCS for the quarter ended December 2018.	All person responsible for collecting TCS.
		Quarterly statement of Foreign remittances in form no. 15CC for quarter ending December 2018.	All responsible person. It is furnished by authorised dealers.
		Due date for furnishing of Form 15G/15H declarations received during the quarter ending December, 2018	Taxable person (where taxable income is nil) can submit these forms in bank or any other place to make sure TDS is not deducted on income (interest, insurance commission, income from corporate bond, post office receipts, rental income etc)
		Issue of TDS certificates for tax deducted under 194IA and 194IB for the month of November 2018.	All Deductors.
18 January 2019	GST	GSTR-4 for the quarter ended December, 2018.	A taxpayer opted Composition scheme.
20  January 2019	GST	GSTR -5 for the month of December, 2018.	All registered non-resident taxpayers.
		GSTR-5A for the month of December, 2018.	All registered non-resident OIDAR Service providers.
		GSTR-3B for the month of December, 2018.	All registered taxable person under GST.
30 January 2019	Income tax	Due date for furnishing challan-cum-statement for TDS made under 194IA and 194IB for the month of December 2018.	All Deductors.
		TCS certificate in respect of tax collected for the quarter ending December 31, 2018.	All person responsible for collecting TCS.
31 January 2019	Income Tax	Quarterly statement of TDS deposited for the quarter ending December 31, 2018.	All Deductors.
		Quarterly return of non-deduction at source by a banking company from interest on time deposit in respect of the quarter ending December 31, 2018	Banking Company
		Intimation under section 286(1) in Form No. 3CEAC.	A resident constituent entity of an international group whose parent is non-resident.
	GST	GSTR-1 for the period of October 2018 to December 2018.	All taxpayers (regular taxpayer) with turnover upto Rs 1.5 crores in previous FY or Current Financial year.
		GSTR 8 for the month of October, November and December, 2018.	All e-commerce operators responsible for collecting tax at source.
		GSTR 7 for the month of October , November and December, 2018.	All authorities responsible for deducting tax at source.