KVP and NSC Certificates in Physical Form not issue from 1st July, 2016 - Government

Recently, Government of India has issued OM to discontinuation of Physical Pre-printed NSC and KVP Certificate for Small Savings Schemes.

As the Department of Posts has shown difficulty vide D.O.letter No. 61-01/2016-SB dated 07.04.2016. Government may be noted that no physically pre-printed KVP and NSC Certificates may be issued on or after 01st July, 2016 by banks or Post Offices.

Government decided to issue of NSC/KVP certificates on and after 01.07.2016 in Two Modes i.e. 1. Exclusive e-mode and 2. Passbook Mode (e-mode format printed or recorded on a passbook).

Exclusive e-Mode :
The format for e-mode is given in Annex I for KVP and NSC.  The Part A of the format is to be made accessible for viewing by a customer online in a non-printable form and part B of the format needs to be maintained as part of the database only.  Any customer can apply for viewing of NSC or KVP through online secure system for which he/she has to open saving account (if Savings Account is not already opened) and apply for Internet Banking before purchase of NSC or KVP.  A customer shall have access of viewing only his/her own deposit under this mode at all times.

Passbook made (e-mode format printed or recorded on a passbook) :

Under this mode, the format for e-mode as given in Part A of Annex I for KVP and NSC, shall be either printed or entered manually on a passbook and such Passbook should be issued with physical signature (in blue ink) of the authorized official.  Manual entries should be made only if either printer is not supplied or it is not in a working condition.  Efforts should be made to provided adequate Passbook printers to all Post Offices and bank branches authorized to handle Small Saving Schemes.

Limit of Tax Audit u/s.44AB and 44AD - Clarification.

Recently CBDT has published Press Release regarding threshold limit of tax audit under section 44AB and section 44AD.  The detailed clarification is as under :

Section 44AB of the Income-tax Act (‘the Act’) makes it obligatory for every person carrying on business to get his accounts of any previous year audited if his total sales, turnover or gross receipts exceed one crore rupees. However, if an eligible person opts for presumptive taxation scheme as per section 44AD(1) of the Act, he shall not be required to get his accounts audited if the total turnover or gross receipts of the relevant previous year does not exceed two crore rupees. The higher threshold for non-audit of accounts has been given only to assessees opting for presumptive taxation scheme under section 44AD.

Common Mistakes That Could Attract 200% Income Tax Penalty

Any concealment of income or under-reporting of income to evade tax can cost you dearly. The tracking mechanism of the income tax department has improved significantly in recent years. Now, you have to report your permanent account number (PAN) for all major transactions. Financial institutions with which you deal with like your bank, mutual fund company or credit card company feed the tax department with information regarding your transactions. The penalty in case of concealment and under-reporting of income can be as high as 200 per cent.

"If you under-report income or don't report some of your income, you may receive notice from the tax department questioning the reason behind it. A penalty will be charged as per the tax laws," says Preeti Khurana, chief editor of Cleartax portal.

According to tax experts, these are some of the income people generally don't declare to the tax authorities.

Gains or return on investment made in the name of spouse or minor child: Many people invest in the name their child or non-working spouse. Gifting money to certain relatives including spouse and minor child is exempt from tax. But if that is invested, the return from the investment has to be clubbed with the income of the person giving the gift (the giftor).

Suppose you have bought a property in the name of your wife and if she had not paid any money towards the purchase of the house, the rental income will be clubbed with your income and will be taxed as per your slab.

Interest income: Interest earned on investments such as fixed deposits, bonds etc are taxable and you have to report it in your tax return. The exemption available is only in case of interest earned on savings account. Interest earned up to Rs 10,000 is exempt from income tax but even in this case you have to show the income in your income tax return and claim the exemption.

Not reporting income from other sources: Suppose you worked as a freelancer for some part of the year and took up a job after that. Your employer will deduct TDS from your salary but you have to also report the income you as a freelancer in your tax return.

Received gifts: If you have received gifts in terms of cash and movable or immovable property worth more than Rs 50,000 other than from your relatives, it is taxable in your hands. Gifts received on the occasion of marriage are exempted from this rule.

Not reporting foreign assets and income: This is considered a serious offence and could attract higher penalty. Suppose you work in a multinational company whose shares are listed abroad. If you have received shares under employee compensation scheme, you will have to report it in your tax return.

Source: NDTV Profit

Last 8 Years Income Tax, TDS and TCS Slab to Deduct Tax in detailed

It is very difficult to remember every year Income Tax Slab, TDS Rates or TCS Rates.  To deduct Tax regarding previous years when we calculate arrears etc.  It is very important and common demand to know about Income tax slabs, TDS and TCS Rate of last too many years.

Every year in the month of February Indian Government has placed Government Budget of Next Financial Year, the most common expectation an Indian citizen has is of ‘change for better’ in the Income tax slab. Income tax has been one of the oldest forms of tax, and it has been present from generations, and is never likely to disappear. So to plan your investment strategy and understand how much tax liability you will incur this year let’s have a look at the tax structure for different categories. These categories are created by the Government of India for taxation purposes, and they are based on Gender and Age.

Normally Tax Slab/Rate are need when we file Income Tax Return, Deduct TDS or TCS. But if we look broad, it is the thing which we need to remember all the year and often some people also need the income tax slabs for the previous years also. So there are income tax slabs, TDS and TCS rates of the last 8 financial years which may be very useful.

Income Tax Slab
Click on the Financial Years (F. Y.) listed below:

TDS Rates
Click on the Financial Years (F.Y.) listed below:

You can also read for last 12 year Income Tax Slab Click Here.

Important e-Hand Book for TDS Deductor and TCS Collector by TRACES for A.Year 2017-18

The TRACES has been published a Hand Book for TDS Deductor or TCS Collector, which helps to file TDS/TCS Returns for Asstt. Year 2017-18.

Tax Deduction at Source (TDS) is one of the means of collection of direct taxes. TDS constitutes nearly 40% of the direct tax collections.

In the legacy system, the deductees claimed TDS credits based on manual TDS certificates, issued by the deductors. There was no correlation between tax deductions, tax payments and issuance of TDS certificates. Verification from the deductor was limited & restricted. Thus, the conventional practice of giving credit of tax deductions, based on manual TDS certificates was open ended leading to tax frauds.

The tax deductors electronically report TDS to the Income Tax Department through quarterly TDS statements. The deductor is obliged to report the following details:
  • PAN & Name of the deductee;
  • Nature, extent & the date of transaction;
  • Amount, rate & the date of tax deducted/collected at Source;
  • Details of tax payment including the amount & date thereof
Based on the information submitted by the deductor, the deductee is given credit of taxes. Therefore, a robust mechanism that ensures correct, reliable flow of data to the department’s database and its collation on the basis of taxpayer identifier(s) (PAN) prevents revenue leakage.

Centralized Processing Cell for TDS (CPC(TDS)) has been conceptualized to ensure a seamless flow of data for tax credits. It leverages technology to provide efficient services. CPC(TDS) introduces transparency in the processes through online display of information. Thus, it forms the backbone of overall TDS administration of the Income Tax Department.

Concepts of Hand Book :
  • Centralized Processing Cell (TDS) is a technology driven transformational initiative on ‘Tax Deduction at Source’ that provides a comprehensive solution through ‘Tax Deduction, Reconciliation, Analysis and Correction Enabling System (TRACES)’ - its core engine.
  • CPC (TDS) undertakes bulk processing of TDS statements to generate ‘Annual Tax Credit’ statements for each taxpayer (PAN holder) in Form 26AS, TDS certificates in Form 16 / 16A & identifies TDS defaults of short payment, short deduction, interest etc.
  • CPC (TDS) reconciles and co-relates information from various sources including banks (tax payment), deductors (reporting tax deduction), Assessing Officers ( mapping no tax / low tax deductions) and tax professionals (reporting international transactions).
With its inclusive approach, the initiative provides bouquet of services to its stake holders including deductors, deductees, Principal Accounts Officers of the Central and State Governments & the officers of the Income Tax Department.

The users/ stakeholders interact with the CPC (TDS) system and with each other through multiple channels of communication including Call Centre, e-mail, website etc.

Download TDS Hand Book for TDS/TCS Deductors

Procedure for Online filing of TDS and TCS Return - Notified

Government of India
Ministry of Finance
Central Board of Direct Taxes
Directorate of Income Tax (Systems)

Notification No. 6/2016

New Delhi, 4th May, 2016

Procedure for online submission of statement of deduction of tax under sub-section (3) of section 200 and statement of collection of tax under provison to sub-section (3) of section 206C of the Income-tax Act, 1961 read with rule 31A(5) and rule 31AA(5) of the Income-tax Rules, 1962 respectively.

The provisions relating to the statement of deduction of tax under sub-section (3) of section 200 and the statement of collection of tax under provison to sub-section (3) of section 206C of the Income-tax Act, 1961 (the Act) are prescribed under Rule 31A and Rule 31AA of the Income-tax Rules, 1962 (the Rules) respectively. As per sub-rule (5) of rule 31A and sub-rule (5) of rule 31AA of the Rules, the Director General of Income-tax (Systems) shall specify the procedures, formats and standards for the purposes of furnishing and verification of the statements and shall be responsible for the day to day administration in relation to furnishing and verification of the statements in the manner so specified.

2. In exercise of power conferred by sub-rule (5) of rule 31A and sub-rule (5) of rule 31AA of the Rules, the Principal Director General of Income-tax (Systems) hereby lays down the following procedures of registration in the e-filing portal, the manner of the preparation of the statements and submission of the statements as follows:

3. The deductors/collectors will have the option of online filing of e-TDS/TCS returns through e-filing portal or submission at TIN Facilitation Centres. Procedure for filing e-TDS/TCS statement online through e-filing portal is as under:

a. Registration: The deductor /collector should hold valid TAN and is required to be registered in the e-filing website (https://incometaxindiaefiling.gov.in/) as “Tax Deductor & Collector” to file the “e-TDS/e-TCS Return”.

b. Preparation: The Return Preparation Utility (RPU) to prepare the TDS/TCS Statement and File Validation Utility (FVU) to validate the Statements can be downloaded from the tin-nsdl website (https://www.tin-nsdl.com/). The statement is required to be uploaded as a zip file and submitted using a Digital Signature Certificate. The signature file for the zipped file will be generated using the DSC Management Utility (available under ‘Downloads’ in the e-Filing website https://incometaxindiaefiling.gov.in/).

c. Submission: The deductor/collector is required to login to the e-filing website using TAN and go to TDS -> Upload TDS. The deductor/collector is required to upload the “Zip” file along with the signature file (generated as explained in para (b) above). Once uploaded, the status of the statement shall be shown as “Uploaded”. The uploaded file shall be processed and validated at the e-filing portal. Upon validation the status shall be either “Accepted” or “Rejected which will reflect within 24 hours from the time of upload. The status of uploaded file will be visible at TDS -> View Filed TDS. In case the submitted file is “Rejected”, the reason for rejection shall be displayed.


TRACES reminders to Download Form 16 and Form 16A for Asstt. Year 2016-17

As per the records of Centralized Processing Cell (TDS), TDS Statements have been filed by you for Quarter 4 of Financial Year 2015-16; however, TDS Certificates in Form 16/16A have not yet been downloaded in respect of this quarter, from the web-portal TRACES.

Immediate Attention: With reference to the above subject, you are requested to download the TDS Certificates, without any further loss of time.
Please also refer to the following provisions of the Income Tax Act, 1961 in this regard:

Downloading of TDS Certificates from TRACES made mandatory:
In this regard, your attention is invited to the CBDT circulars no. 03/2011 dated 13.05.2011, no. 01/2012 dated 09.04.2012 and 04/2013 dated 17.04.2013, on the Issuance of certificate for Tax Deducted at Source in Form 16/16A as per IT Rules 1962. It is now mandatory for all deductors to issue TDS certificates after generating and downloading the same from "TDS Reconciliation Analysis and Correction Enabling System" or http://www.tdscpc.gov.in (herein after called TRACES Portal).

TDS Certificates downloaded only from TRACES hold valid:
In view of above circulars, it may kindly be noted that the TDS Certificates downloaded only from TRACES Portal will be valid. Certificates issued in any other form or manner will not comply to the requirements referred in the Income-tax Act 1961 read with relevant Rules and Circulars issued in this behalf from time to time.

Due Date for downloading and Penalty for non-compliance:

Please be advised that under the provisions of section 203 of the Income Tax Act, 1961 read with rule 31A, Certificate of tax deducted at source is to be furnished within fifteen (15) days from the due date for furnishing the statement of tax deducted at source. Failure to comply with the provisions of the Act will attract penalty under the provisions of section 272A of the Act, a sum of one hundred rupees for every day during which the failure continues.

Assistance for downloading TDS Certificates from TRACES :

You can logon to our portal http://www.tdscpc.gov.in and refer to our e-Tutorial to download TDS Certificates. For any assistance, you can write to ContactUs@tdscpc.gov.in or call our toll-free number 1800 103 0344.