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No TAN Only PAN for TDS on Purchase of Immovable Property w.e.f. 01 Jun. 2013.

Any person purchasing immovable property (other than rural agricultural land) of Rs. 50 Lac or more is required to deduct Tax @ 1% from the payment made to seller.

Deduct TDS
  • Deduct Tax @ 1% from the payment made to the seller.
  • Collect the PAN of the seller and verify the same with the origional PAN Card.
Online filing of statement at www.tin-nsdl.com.
  • It is mandatory to furnish the PAN of the seller as well as the purchaser while providing the information regarding the sale transaction in the online form (Form No. 26QB)
  • Please ansure that there is no error in quoting the PAN or other details in filing online Frm 26QB.
Depositing the tax deducted
  • Deposit the tax deducted through e-payment only, either at the time of filing of Form 26QB or subsequent to it.  e-Payment can be made using electronic payment facility at any aforesaid bank, including self not banking facility.
  • In case, the payment of tax deducted is make subsequent to the file of Form 26QB, pay tax online electroic payment facility at any aforesaid bank within 7 days after online filing of statement at www.tin-nsdl.com
  • It' there is a delay beyoind 7 days in payment of tax, statement filed online whould be treated as "Invialid".  In that case, Form 26QB, will need to tbe filing again.
Issue of TDS Certificate
  • Download TDS Certificate from TRACES (www.traces.gov.in).
  • Buyer of immovable property can download Form 16B after registering on TRACES as Tax Payer.
Responsibility of the Seller of the Immovable Property.
  • Provide your PAN to the Purchaser for furing information regarding TDS to the Income Tax Department.
  • Verify deposit of Taxes deducted by the Purchaser in your Form 26AS Annual Tax Statement.
TAN no required
  • TAN of the deductor is not required for the payment and importing of the TAX deducted under this section and PAN alloted to the deductor shall be used for payment and importing the TDS made under this section.

How to Calculate Income-Tax to be deducted from Salary for Asstt. Year 2014-15.

CIRCULAR NO : 08 /2013
F.No. 275/192/2013-IT(B)
Dated 10th October, 2013

Salary income for the purpose of section 192 shall be computed as follow:-
  • First compute the gross salary as mentioned in para 5.1 including all the incomes mentioned in para 5.2 and excluding the income mentioned in para 5.3.
  • Allow deductions mentioned in para 5.4 from the figure arrived at (a) above and compute the amount to arrive at Net salary of the employee
  • Add income from all other heads- House property, Profits & gains of Business or Profession, capital gains and Income from other Sources to arrive at the Gross
Total Income as shown in the form of simple statement mentioned para 3.5. However it may be remembered that no loss under any such head is allowable by DDO other than loss under the Head “Income from House property”.
  • Allow deductions mentioned in para 5.5 from the figure arrived at (c) above ensuring that the relevant conditions are satisfied. The aggregate of the deductions subject to the threshold limits mentioned in para 5.5 shall not exceed the amount at
  • above and if it exceeds, it should be restricted to that amount.
This will be the amount of Total income of the employee on which income tax would be required to be deducted. This income should be rounded off to the nearest multiple of ten rupees.

Income-tax on such income shall be calculated at the rates given in para 2.1 of this Circular keeping in view the age of the employee and subject to the provisions of sec. 206AA, as discussed in para 4.8. Rebate as per Section 87A upto Rs 2000/- to eligible persons (see para 6) may be given. Surcharge shall be calculated in cases where applicable (see para 2.2).

The amount of tax payable so arrived at shall be increased by educational cess as applicable (2% for primary and 1% for secondary education) to arrive at the total tax payable.

The amount of tax as arrived at para 9.3 should be deducted every month in equal installments. Any excess or deficit arising out of any previous deduction can be adjusted by increasing or decreasing the amount of subsequent deductions during the same financial year.

7th Pay Commission - Latest Position and Terms of Reference.

7TH CPC - TERMS OF REFERENCE - LATEST POSITION
Dear Comrades,
VII-CPC – Terms of reference-
The members of the National Secretariat of the Confederation available at New Delhi met on 23rd Oct. 2013 and again on 24th October, 2013 to discuss and formulate our views on the 7th CPC terms of Reference.  On the basis of the discussions, we prepared a draft terms of reference and submitted it for consideration of the Staff Side.  The important points we placed in our draft for the consideration of the staff side were:-

(a) The Commission to examine the present structure of pay and allowances and suggest changes.

(b) To give effect to its recommendations from 1.1.2011 i.e. wage revision must be after       every five years.

(c) D.A (50%) to be merged with pay with effect from 1.1.2011.

(d) To determine Interim relief taking into account the erosion in the value of wages over the years,

(e) To include GDS within the ambit of the 7th Central Pay Commission.

(f) To revise the retirement benefits and accord pension maintaining parity in quantum in respect of past, present and future pensioners.

(g) To extend the statutory defined benefit pension to those who have entered service after 1.1.2004.

(h) To settle the anomalies raised in various fora of JCM on a priority basis and within a specified time frame.

(i) To provide cashless/hazzle free Medicare to employees and pensioners.
The Government of India had convened a meeting of the Staff side representatives on 24.10.2013 to discuss the terms of reference.  The meeting took place at 3.00PM on 24th under the Chairmanship of Secretary, Personnel.  Besides the points mentioned above, the staff raised many other matters connected with the setting up of the CPC. viz. the inclusion of labour Representative as a Member of the Commission; the anomalous  situation brought about by the Grade pay based MACP Scheme; the requirement of a mechanism to settle the 6th CPC related anomalies;  the need to allow the proposals of Cadre Review to be examined by the Government independently without referring it to CPC;  to have members in the Commission who have gained  expertise to impart to the Commission the nuances and functional requirements of various Departments;  to relook at the new Pay Structure brought in by the 6th CPC in the light of the experience between 2008 to 2013 etc.  In conclusion the staff side requested the Government to provide it with a draft terms of reference taking into account the views placed by them.  It was also proposed by the Staff Side that on exchange of the draft terms of reference prepared by the Staff Side and the Official Side, a meeting with the Secretary, Personnel and Secretary, Expenditure could be arranged to iron out the differences, if any.
The Staff Side met again on 25th at its office and deliberated upon various views presented by different organisations and finalised the draft terms of reference. We shall publish the said draft terms of reference as and when the same is submitted to the Government.
It is obvious that despite the unanimous position taken by all the organisations, the Government may not necessarily agree with many of the basic issues, viz. Date of effect, merger of  DA, Interim Relief, Coverage of GDS etc.  We appeal to our affiliates/ State COCs to continue the campaign amongst the employees to generate necessary sanctions.
With greetings,
Yours fraternally,
(M.Krishnan)
Secretary General.
Source: www.confederationhq.blogspot.in

7th Central Pay Commission - Draft terms of reference.

DRAFT TERMS OF REFERENCE 7th CPC
Finalized by the Staff Side at the meeting of 25.10.2013.
A. To examine the existing structure of pay, allowances and other benefits/facilities, retirement benefits like Pension, Gratuity, other terminal benefits etc. to the following categories of employees.
1. Central Government employees – industrial and non industrial;
2. Personnel belonging  to  All India services;
3. Personnel belonging to the Defence Forces;
4. Personnel called as Grameen Dak Sewaks belonging to the Postal Department;
5. Personnel  of Union Territories;
6. Officers and employees of the Indian Audit and Accounts Department;
7. Officers and employees of the Supreme Court;
8. Members of Regulatory bodies (excluding RBI) set up under Act of Parliament.

B. To work out the comprehensive revised pay packet for the categories of Central Government employees mentioned in (A) above as on 1.1.2014.
C. The Commission will determine the pay structure, benefits facilities, retirement benefits etc. taking into account the need to provide minimum wage with reference to the recommendation of the 15th Indian Labour Conference (1957) and the subsequent judicial pronouncement of the honorable Supreme Court there-on, as on 1.1.2014.
D. To determine the Interim Relief needed to be sanctioned immediately to the Central Government employees  and  Pensioners mentioned in (A) above;
E. To determine the percentage of Dearness allowance/Dearness Relief immediately to be merged with Pay and pension 
F. To settle the anomalies raised in various fora of JCM.                                                        
G. To work out the improvements needed to the existing  retirement benefits, like pension, death cum retirement gratuity, family  pension and other terminal or recurring  benefits maintaining parity amongst past, present and future pensioners and family pensioners including those who entered service on or after 1.1.2004.
H. To recommend methods for providing cashless/hassle-free Medicare facilities to the employees and Pensioners including Postal pensioners.
Source: AIRF

Updated Income Tax Calculator for All Salaried Employee for Asstt. Year 2014-15.

With reference to Circular No. 08/13 dated 10.10.2013 issued by Income Tax Department (CBDT) contains the rate of deductions of Income Tax from the payment of Income chargeable under the Head "Salary" for the Asstt. Year 2014-15.

As per the Finance Act, 2013, Income Tax is required to be deducted under Section 192 of the Act from Income Chargeable under the head "Salaries" for the Fin. Year 2013-14 (i.e. Asstt. Year 2014-15).

For the purpose of making the payment of tax below Income Tax Excel Utility Calculate average of Income Tax computed on the basis of rate in force for the Fin. Year, on the Income chargeable under the head "salaries" including the value of perquisits for which tax has been paid by the employer hemself.

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Monthwise Salary Statement


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Incomes not included under the head "Salaries" (Exemptions).

Any income falling within any of the following clauses shall not be included in computing the income from salaries for the purpose of section 192 of the Act :-

The value of any travel concession or assistance received by or due to an employee from his employer or former employer for himself and his family, in connection with his proceeding (a) on leave to any place in India or (b) after retirement from service, or, after termination of service to any place in India is exempt under Section 10(5) subject, however, to the conditions prescribed in Rule 2B of the Rules.
For the purpose of this clause, "family" in relation to an individual means:
  1. the spouse and children of the individual; and
  2. the parents, brothers and sisters of the individual or any of them, wholly or mainly dependent on the individual.
It may also be noted that the amount exempt under this clause shall in no case exceed the amount of expenses actually incurred for the purpose of such travel.

Death-cum-retirement gratuity or any other gratuity is exempt to the extent specified from inclusion in computing the total income under Section 10(10). Any death-cum-retirement gratuity received under the revised Pension Rules of the Central Government or, as the case may be, the Central Civil Services (Pension) Rules, 1972, or under any similar scheme applicable to the members of the civil services of the Union or holders of posts connected with defence or of civil posts under the Union (such members or holders being persons not governed by the said Rules) or to the members of the all-India services or to the members of the civil services of a State or holders of civil posts under a State or to the employees of a local authority or any payment of retiring gratuity received under the Pension Code or Regulations applicable to the members of the defence service. Gratuity received in cases other than those mentionedabove, on retirement, termination etc is exempt up to the limit as prescribed by the Board. Presently the limit is Rs. 10 lakhs w.e.f. 24.05.2010 [Notification no. 43/2010 S.O. 1414(E) F.No. 200/33/2009-ITA-1 dated 11th June 2010].

Any payment in commutation of pension received under the Civil Pensions (Commutation) Rules of the Central Government or under any similar scheme applicable to the members of the civil services of the Union or holders of posts connected with defence or of civil posts under the Union (such members or holders being persons not governed by the said Rules) or to the members of the all- India services or to the members of the defence services or to the members of the civil services of a State or holders of civil posts under a State or to the employees of a local authority] or a corporation established by a Central, State or Provincial Act, is exempt under Section10(10A)(i). As regards payments in commutation of pension received under any scheme of any other employer, exemption will be governed by the provisions of section 10(10A)(ii). Also, any payment in commutation of pension from a fund referred to in Section 10(23AAB) is exempt under Section 10(10A)(iii).

Any payment received by an employee of the Central Government or a State Government, as cash-equivalent of the leave salary in respect of the period of earned leave at his credit at the time of his retirement, whether on superannuation or otherwise, is exempt under Section 10(10AA)(i). In the case of other employees, this exemption will be determined with reference to the leave to their credit at the time of retirement on superannuation or otherwise, subject to a maximum of ten months' leave. This exemption will be further limited to the maximum amount specified by the Government of India Notification No.S.O.588(E) dated 31.05.2002 at Rs. 3,00,000/- in relation to such employees who retire, whether on superannuation or otherwise, after 1.4.1998.

Under Section 10(10B), the retrenchment compensation received by a workman is exempt from income-tax subject to certain limits. The maximum amount of retrenchment compensation exempt is the sum calculated on the basis provided in section 25F(b) of the Industrial Disputes Act, 1947 or any amount not less than Rs.50,000/- as the Central Government may by notification specify in the Official Gazette, whichever is less. These limits shall not apply in the case where the compensation is paid under any scheme which is approved in this behalf by the Central Government, having regard to the need for extending special protection to the workmen in the undertaking to which the scheme applies and other relevant circumstances. The maximum limit of such payment is Rs. 5,00,000/- where retrenchment is on or after 1.1.1997 as specified in Notification No. 1096 of 25-06-1999.

Under Section 10(10C), any payment received or receivable (even if received in installments) by an employee of the following bodies at the time of his voluntary retirement or termination of his service, in accordance with any scheme or schemes of voluntary retirement or in the case of public sector company, a scheme of voluntary separation, is exempt from income-tax to the extent that such amount does not exceed Rs. 5,00,000/-:
  • A public sector company;
  • Any other company;
  • An Authority established under a Central, State or Provincial Act;
  • A Local Authority;
  • A Cooperative Society;
  • A university established or incorporated or under a Central, State or Provincial Act, or, an Institution declared to be a University under section 3 of the University Grants Commission Act, 1956;
  • Any Indian Institute of Technology within the meaning of Section 3 (g) of the Institute of Technology Act, 1961;
  • Such Institute of Management as the Central Government may by notification in the Official Gazette, specify in this behalf.
The exemption of amount received under VRS has been extended to employees of the Central Government and State Government and employees of notified institutions having importance throughout India or any State or States. It may also be noted that where this exemption has been allowed to any employee for any assessment year, it shall not be allowed to him for any other assessment year. Further, if relief has been allowed under section 89 for any assessment year in respect of amount received on voluntary retirement or superannuation, no exemption under section 10(10C) shall be available.

Any sum received under a Life Insurance Policy (Sec 10(10D), including the sum allocated by way of bonus on such policy other than the following is exempt under section 10(10D):
  1. any sum received under section 80DD(3) or section 80DDA(3); or
  2. any sum received under a Keyman insurance policy; or
  3. any sum received under an insurance policy issued on or after 1.4.2003, but on or before 31-03-2012, in respect of which the premium payable for any of the years during the term of the policy exceeds 20 percent of the actual capital sum assured; or
  4. any sum received under an insurance policy issued on or after 1.4.2012 in respect of which the premium payable for any of the years during the term of the policy exceeds 10 percent of the actual capital sum assured; or
  5. any sum received under an insurance policy issued on or after 1.4.2013. In cases of persons with disability or person with severe disability as per Sec 80 U or suffering from disease or ailment as specified in Sec 80DDB, in respect of which the premium payable for any of the years during the term of the policy exceeds 15 percent of the actual capital sum assured
However, any sum received under such policy referred to in (iii), (iv) and (v) above, on the death of a person would be exempt.

Any payment from a Provident Fund to which the Provident Funds Act, 1925, applies or from any other provident fund set up by the Central Government and notified by it in the Official Gazette is exempt under section 10(11).

Under section 10(13A) of the Act, any special allowance specifically granted to an assessee by his employer to meet expenditure incurred on payment of rent (by whatever name called) in respect of residential accommodation occupied by the assessee is exempt from Income-tax to the extent as may be prescribed, having regard to the area or place in which such accommodation is situated and other relevant considerations. According to Rule 2A of the Rules, the quantum of exemption allowable on account of grant of special allowance to meet expenditure on payment of rent shall be the least of the following:
  • The actual amount of such allowance received by the assessee in respect of the relevant period i. e. the period during which the accommodation was occupied by the assesse during the financial year; or
  • The actual expenditure incurred in payment of rent in excess of 1/10 of the salary due for the relevant period; or
  1. Where such accommodation is situated in Bombay, Calcutta, Delhi or Madras, 50% of the salary due to the employee for the relevant period; or
  2. Where such accommodation is situated in any other places, 40% of the salary due to the employee for the relevant period,
For this purpose, "Salary" includes dearness allowance, if the terms of employment so provide, but excludes all other allowances and perquisites.

It has to be noted that only the expenditure actually incurred on payment of rent in respect of residential accommodation occupied by the assessee subject to the limits laid down in Rule 2A, qualifies for exemption from income-tax. Thus, house rent allowance granted to an employee who is residing in a house/flat owned by him is not exempt from income-tax. The disbursing authorities should satisfy themselves in this regard by insisting on production of evidence of actual payment of rent before excluding the House Rent Allowance or any portion thereof from the total income of the employee.

Though incurring actual expenditure on payment of rent is a pre-requisite for claiming deduction under section 10(13A), it has been decided as an administrative measure that salaried employees drawing house rent allowance upto Rs.3000/- per month will be exempted from production of rent receipt. It may, however, be noted that this concession is only for the purpose of tax-deduction at source, and, in the regular assessment of the employee, the Assessing Officer will be free to make such enquiry as he deems fit for the purpose of satisfying himself that the employee has incurred actual expenditure on payment of rent.

Further if annual rent paid by the employee exceeds Rs 1,00,000 per annum, it is mandatory for the employee to report PAN of the landlord to the employer. In case the landlord does not have a PAN, a declaration to this effect from the landlord along with the name and address of the landlord should be filed by the employee.

Section 10(14) provides for exemption of the following allowances :-
  1. Any special allowance or benefit granted to an employee to meet the expenses wholly, necessarily and exclusively incurred in the performance of his duties as prescribed under Rule 2BB subject to the extent to which such expenses are actually incurred for that purpose.
  2. Any allowance granted to an employee either to meet his personal expenses at the place of his posting or at the place he ordinarily resides or to compensate him for the increased cost of living, which may be prescribed and to the extent as may be prescribed.
However, the allowance referred to in (ii) above should not be in the nature of a personal allowance granted to the assessee to remunerate or compensate him for performing duties of a special nature relating to his office or employment unless such allowance is related to his place of posting or residence.

The CBDT has prescribed guidelines for the purpose of Section 10(14) (i) & 10 (14) (ii) vide notification No.SO 617(E) dated 7th July, 1995 (F.No.142/9/95-TPL)which has been amended vide notification SO No.403(E) dt 24.4.2000 (F.No.142/34/99-TPL). The transport allowance granted to an employee to meet his expenditure for the purpose of commuting between the place of his residence and the place of duty is exempt to the extent of Rs.800 p.m. or Rs1600 p.m (for a blind person) vide notification S.O.No. 395(E) dated 13.5.98.

Under Section 10(15)(iv)(i) of the Act, interest payable by the Government on deposits made by an employee of the Central Government or a State Government or a public sector company out of his retirement benefits, in accordance with such scheme framed in this behalf by the Central Government and notified in the Official Gazette is exempt from income-tax. By notification No.F.2/14/89-NS-II dated 7.6.89, as amended by notification No.F.2/14/89-NS-II dated 12.10.89, the Central Government has notified a scheme called Deposit Scheme for Retiring Government Employees, 1989 for the purpose of the said clause.

Any scholarship granted to meet the cost of education is not to be included in total income as per provisions of section 10(16) of the Act.

Section 10(18) provides for exemption of any income by way of pension received by an individual who has been in the service of the Central Government or State Government and has been awarded "Param Vir Chakra" or "Maha Vir Chakra" or "Vir Chakra" or such other gallantry award as may be specifically notified by the Central Government. Family pension received by any member of the family of such individual is also exempt [Notifications No.S.O.1948(E) dated 24.11.2000 and 81(E) dated 29.1.2001, which are enclosed as per Annexure VIII & IX]. “Family” for this purpose shall have the meaning assigned to it in Section 10(5) of the Act.

DDO may not deduct any tax in the case of recipients of such awards after satisfying himself about the veracity of the claim.

Under Section 17 of the Act, exemption from tax will also be available in respect of:-
  • the value of any medical treatment provided to an employee or any member of his family, in any hospital maintained by the employer;
  • any sum paid by the employer in respect of any expenditure actually incurred by the employee on his medical treatment or of any member of his family:
  1. in any hospital maintained by the Government or any local authority or any other hospital approved by the Government for the purposes of medical treatment of its employees;
  2. in respect of the prescribed diseases or ailments as provided in Rule 3A(2) of the Rules in any hospital approved by the Chief Commissioner having regard to the prescribed guidelines as provided in Rule 3(A)(1)of the Rules.
  • premium paid by the employer in respect of medical insurance taken for his employees (under any scheme approved by the Central Government or Insurance Regulatory and Development Authority) or reimbursement of insurance premium to the employees who take medical insurance for themselves or for their family members (under any scheme approved by the Central Government or Insurance Regulatory and Development Authority);
  • reimbursement, by the employer, of the amount spent by an employee in obtaining medical treatment for himself or any member of his family from any doctor, not exceeding in the aggregate Rs.15,000/- in an year.
  • As regards medical treatment abroad, the actual expenditure on stay and treatment abroad of the employee or any member of his family, or, on stay abroad of one attendant who accompanies the patient, in connection with such treatment, will be excluded from perquisites to the extent permitted by the Reserve Bank of India. It may be noted that the expenditure incurred on travel abroad by the patient/attendant, shall be excluded from perquisites only if the employee's gross total income, as computed before including the said expenditure, does not exceed Rs.2 lakhs.
For the purpose of availing exemption on expenditure incurred on medical treatment, "hospital" includes a dispensary or clinic or nursing home, and "family" in relation to an individual means the spouse and children of the individual. Family also includes parents, brothers and sisters of the individual if they are wholly or mainly dependent on the individual.

TDS on Provident Fund and Superannuation Fund for Asstt. Year 2014-15

The trustees of a Recognized Provident Fund, or any person authorized by the regulations of the Fund to make payment of accumulated balances due to employees, shall in cases where sub-rule(1) of Rule 9 of Part A of the Fourth Schedule to the Act applies, at the time when the accumulated balance due to an employee is paid, make therefrom the deduction specified in Rule 10 of Part A of the Fourth Schedule to the Act. The accumulated balance is treated as income chargeable under the head “Salaries”.

Where any contribution made by an employer, including interest on such contributions, if any, in an approved Superannuation Fund is paid to the employee, tax on the amount so paid shall be deducted by the trustees of the Fund to the extent provided in Rule 6 of Part B of the Fourth Schedule to the Act. TDS should be at the average rate of tax at which, the employee was liable to be taxed during the preceding three years or during the period, if that period is less than three years, when he was member of the fund.

The deductor shall remain liable to deduct tax on any sum paid on account of returned contributions (including interest, if any) even if a fund or part of a fund ceases to be an approved Superannuation fund.

Income details & proof of savings for tax calculation / deduction purposes for FY 2013-2014

Central Pollution Control Board, New Delhi
File No. AC-101/05/VG/2013-14/ 

September 24, 2013

CIRCULAR

Subject: Income details & proof of savings for tax calculation / deduction purposes for FY 2013-2014
 
The government of India imposes an income tax on taxable income of individuals. Levy of tax is separate on each of the persons. The levy is governed by the Indian Income Tax Act, 1961. The Indian Income Tax Department is governed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue under the Ministry of Finance, Govt. of India. Income tax is a key source of funds that the government uses to fund its activities and serve the public.

Section 192 of the I.T.Act, 1961 provides that every person (DDO in case of CPCB) responsible for paying any income which is chargeable under the head ‘salary, shall deduct income tax on the estimated income of the assessee under the head salaries. The tax is required to be calculated at the average rate of income tax as computed on the basis of the rates in force. The deduction is to be made at the time of the actual payment. However, no tax is required to be deducted at source, unless the estimated salary income exceeds the maximum amount not chargeable to tax applicable in case of an individual during the relevant financial year. The tax once deducted is required to be deposited in government account and a certificate of deduction of tax at source (also referred as Form No.16) is to be issued to the employee. Finally, the employer/deductor is required to prepare and file quarterly statements in form No.24Q with the Income-tax Department PAN and address are mandatory. If not furnished, tax at source is to be deducted at the prescribed rates or 20% whichever is higher without giving any rebate/deduction.
ArrangementsBy 30th November 2013By 15th February 2014
Annexure I & II along-with proof of the savings (self-attested) till Nov. 30th 2013. Only the documentary proof (Annexure need not be sent again) of the proposed savings (self-attested) declared in annexure II.
DeclarationDeclaration of Proposed savings in the prescribed column in annexure II which are proposed to be made after 30th November 2013 for 2013-2014.Proposed savings or proof of the savings will not be considered after this date, even if submitted.
Last Date 30th November 201315th February 2014)

In case, no declaration is received by November 30th 2013, due tax will be deducted as per the current tax structure.  soft copy of this circular & saving submission annexure are also available at the employees’ corner on the CPCB’s web-site i.e. http://www.cpcb.nic.in/employee/itcircular13-14.pdf & saving submission annexure http://www.cpcb.nic.in/employee/savingsubmission13-14.pdf at Intranet portal (http://10.24.84.156:8080/cpcb.htm).
(M.S. Bansal)
 Accounts Officer & I/C F&A
Income Tax Rates for the Financial Year 2013-2014
For All Assesses:
Upto Rs.2,00,000/- NIL
Rs.2,00,010/- to Rs.5,00,000/- @ 10% of (total income minus Rs.2,00,000)
Rs.5,00,010/- to Rs.10,00,000/- Rs.30,000/- + 20% of (total income minus Rs.5,00,000)
Rs.10,00,010/- & above Rs.1,30,000/- + 30% of (total income minus Rs.10,00,000)

Things one must know: 
1. As per new section 87A wef AY 2014-2015 onwards: 
An assessee, being an individual resident in India, whose total income does not exceed five hundred thousand rupees, shall be entitled to a deduction, from the amount of income-tax (as computed before allowing the deductions under this Chapter) on his / her total income with which he/she is chargeable for any assessment year, of an amount equal to hundred per cent of such income-tax or an amount of two thousand rupees, whichever is less. 

2. Education Cess 2% +Secondary and Higher Secondary Education Cess 1% Education Cess is applicable (2%+1%)@ 3% on income tax 

3. Threshold limit of exemption from personal income tax in the case of all assesses is Rs.2,00,000. The threshold limit for a resident woman assessee is also Rs.200,000, while for a resident senior citizen over 60 years is Rs.2,50,000 and for senior citizen over 80 years is Rs.500,000. 

4. The last date for filing of individual income tax return with the concerned ITO is 31st July 2014. For the Assessment year 2013-14, E-filing must for people with annual income above Rs 5 lakh. 

5. Tax payers with salary income of up to Rs.5 lakh and interest from savings bank accounts up to `10,000 is required to file income tax returns in either mode manually or e.filing.

(M.S. Bansal) 
Accounts Officer 
& I/C F&A

Source: www.cpcb.nic.in

Due Date Extends for e-Filing of Audit Report & Return to 31.10.2013 - CBDT

CBDT has issued a order regarding extends due dates for e-filing of audit report and return to October 31, 2013 under section 119 of Income Tax Act, 1961.  The Central Broad of Direct Taxes had extended due dated by the order u/s. 119 dated 26.09.2013 in F. No. 225/225/11/2013 ITA.II, regarding the furnishing of Audit Report and corresponding Income Tax Return. The CBDT again has exenteds due dates of  e-Filing of Audit Report and Return for Fin. Year 2012-13 upto 31.10.2013 by order No. F. No. 225/117/2013/ITA. II dated 24.10.2013. under section 139 of the Income Tax Act.  The "due date" extended order u/s. 119 for filing of Returns and Tax Audit Report for the Asstt. Year 2013-14 to 31st October 2013 for assessees whose due date of filing return of income was 30th September 2013 is as follows:

Deductions u/s. 80CCG (New Equity Saving Scheme) for Asstt. Year 2014-15.

Newly inserted Section 80CCG provides deduction wef assessment year 2013-14 in respect of investment made under notified equity saving scheme. Rajiv Gandhi Equity Savings Scheme 2012 has been notified vide SO No 2777 dated 23.11.2012 as a scheme under this section. The deduction under this section is available if following conditions are satisfied:
  • The assessee is a resident individual
  • His gross total income does not exceed Rs. 12 lakhs;
  • He has acquired listed shares in accordance with a notified scheme or listed units of an equity oriented fund as defined in section 10(38);
  • The assessee is a new retail investor;
  • The investment is locked-in for a period of 3 years from the date of acquisition in accordance with the above scheme;
  • The assessee satisfies any other condition as may be prescribed.
Amount of deduction –The amount of deduction is at 50% of amount invested in equity shares/units. However, the amount of deduction under this provision cannot exceed Rs. 25,000.

Withdrawal of deduction – If the assessee, after claiming the aforesaid deduction, fails to satisfy the above conditions, the deduction originally allowed shall be deemed to be the income of the assessee of the year in which default is committed.

This deduction is now allowed for three consecutive assessment years beginning with the AY in which the listed equity shares or units were first acquired. If any deduction is claimed by a taxpayer under this section in any year, he shall not be entitled to any deduction under this section for any other year.

Penalty for failure TDS Return in Time or Incorrect Information u/s. 271H.

If a person fails to deliver or caused to be delivered a statement within the time prescribed in section 200(3) or furnishes an incorrect statement, in respect of tax deducted at source on or after 1.07.2012, he shall be liable to pay, by way of penalty a sum which shall not be less than Rs. 10,000/- but which may extend to Rs 1,00,000/-. However, the penalty shall not be levied if the person proves that after paying TDS with the fee and interest, if any, to the credit of Central Government, he had delivered such statement before the expiry of one year from the time prescribed for delivering the statement.

At the time of preparing statements of tax deducted, the deductor is required to mandatorily quote:
  1. his tax deduction and collection account number (TAN) in the statement;
  2. his permanent account number (PAN) in the statement except in the case where the deductor is an office of the Government( including State Government). In case of Government deductors “PANNOTREQD” to be quoted in the e-TDS statement;
  3. the permanent account number PAN of all deductees;
  4. furnish particulars of the tax paid to the Central Government including book identification number or challan identification number, as the case may be.
  5. furnish particular of amounts paid or credited on which tax was not deducted in view of the issue of certificate of no deduction of tax u/s 197 by the assessing officer of the payee.

Condition to Claim Deduction of House Loan Interest u/s. 24(b) for Asstt. Year 2014-15

There are two main benefits which are available under Income Tax Act, 1961 in relation to Purchase or Construction of House Property which are described as under:
  1. Deduction of Interest on Capital borrowed for purchase or construction of House Property under Section 24 (b) of the Income Tax Act, 1961. (Interest paid by house owner on housing loan)
  2. Principle amount paid towards Housing loan for  purchase or construction of House Property under Section 80 C of the Income Tax Act, 1961.
  3. The amount stamp duty/ Registration charges paid while acquiring property will be allowed deduction U/s 80C.
Section 24(b) of the Act allows deduction from income from houses property on interest on borrowed capital as under:-
  1. the deduction is allowed only in case of house property which is owned and is in the occupation of the employee for his own residence. However, if it is actually not occupied by the employee in view of his place of the employment being at other place, his residence in that other place should not be in a building belonging to him.
  2. The quantum of deduction allowed as per table below:
Sl. No.
Purpose of borrowing capital
Date of borrowing
capital
Maximum Deduction
allowable
1
Repair or renewal or reconstruction of the
house
Any time
Rs. 30,000/-
2
Acquisition or construction of the house
Before 01.04.1999
Rs. 30,000/-
3
Acquisition or construction of the house
On or after 01.04.1999
Rs. 1,50,000/-

In case of Serial No. 3 above
  • The acquisition or constructing of the house should be completed within 3 years from the end of the Fin. Year in which the capital was borrowed. Hence it is necessary for the DDO to have the completion certificate of the house property against which deduction is claimed either from the builder or through self-declaration from the employee.
  • Further any prior period interest for the Fin. Years upto the Fin. Year in which the property was acquired and constructed shall be deducted in equal installments for the FY in question and subsequent four Fin. Years. 
  • The employee has to furnish before the DDO a certificate from the person to whom any interest is payable on the borrowed capital specifying the amount of interest payable. In case a new loan is taken to repay the earlier loan, then the certificate should also show the details of Principal and Interest of the loan so repaid.
Interest Paid towards housing loan:
     The house property has been acquired, constructed, repaired, renewed or reconstructed with borrowed capital, the amount payable towards interest on borrowed capital is allowed as deduction under u/s 24(b) of Income tax act.
  1. We have to note here Interest payable on barrowed capital is allowed (Interest paid is irreverent here).
  2. In case of under construction property, Interest will aggregated from the date of borrowing till the end of the previous year prior to the previous year in which the house is completed and allowed in five successive financial years starting from the year in which the acquisition or construction was completed.
  3. In case Assesses is owner of more than one residential property, he may exercise an option to treat any one of the houses to be self occupied and the other houses will be deemed to be let out and annual value of such house will be determined as per Section 23(1)(a) of the Income Tax Act, 1961.
Principle Amount paid towards Housing Loan:
     Any payment made for purchase or construction of a residential house property which is chargeable to tax under the head “Income from House Property” towards any installment or part payment due to any Bank, Financial Institution, Company or Co-Operative Society towards the cost of the house property allotted to him is allowed as deduction U/s 80 C of the Income Tax Act, 1961 to the extent of Rs. 1,00,000 along with other Specified Investments mentioned under Section 80 C of the Income Tax Act, 1961.

Stamp Duty and Registration Charges for a home:
     The amount you pay as stamp duty or registration fee  when you buy a house  can be claimed as deduction under section 80C in the year of purchase of the house.

Below Taxable Income but TDS Deductor Deduct TDS, What do you do?

There is some confusion in the hand of deductee that deductee income is less than taxable income but deductor is deductor is deducting TDS from his income.  What should he do ?.  The answer of question is explained here with given below two FAQ's :-

Q.1. I have made some deposits with a bank on which annual interest is around 15000. My income is below taxable limit. The banker wants to deduct tax. What do I do?

Ans.: You can file a self-declaration to the banker in Form 15G or 15H (for Senior Citizens) stating that your income is below taxable limit. The form is available with your banker, the local Income Tax office and can be downloaded from the website www.incometaxindia.gov.in This form should be filed before the interest begins to accrue in the fixed deposit account, since the declaration has no retrospective effect.

Q.2. I have let out a property for 20,000 per month. The tenant is deducting tax that is more than my tax liability. What can I do under this circumstance?

Ans.: If you compute your tax liability and find it to be lower than the tax being deducted, you may approach your Assessing Officer by filing Form 13. He will issue a certificate directing the tenant to make TDS at a lesser rate. This form is available with the local Income Tax office or can be downloaded from the website www.incometaxindia.gov.in

Source: www.tdstaxindia.com

Confused about taxes on income from shares?

Confused about taxation of any income arising in respect of shares, be it capital gains on sale of such shares or dividends received? People generally think that any income received in respect of shares is exempt from tax. This is really not so.

In order to make matter clear for the readers, I have tried to explain the tax implications of income from shares in this article. There are many aspects relating to taxation of shares in India. First let us take up the provision for computing capital gains and tax rates on capital gains on sale of shares.

Holding Period requirement long-term and short-term:

Generally, profits arising on sale of any capital assets are treated as long-term if the same have been held for 36 months or more on the date of sale.

However, in case of shares in any Company, the holding period requirement is only 12 months or more in order to make such profits as long-term. It is important to note that the requirement of lower holding period is applicable for shares in any Company and not necessarily an Indian Company.

Moreover even shares held in a private limited company will become long- term if held for 12 months or more on the date of sale of such shares.

Tax rate in case of capital gains arising on sale of equity shares listed on Indian Stock Exchanges:

As per the present provisions of income-tax laws, any long-term capital gains arising on sale of equity shares listed on Indian stock exchange and sold through a stock-broker are fully exempt from income tax.

This exemption is not available in case the listed shares are sold outside the stock exchange platform or cases where the shares have been tendered under buyback scheme or under any open offer.

For claiming this exemption, the equity shares should be sold on the platform of stock exchange in India on which Security Transaction Tax (STT) has been paid. In order to verify whether the shares sold by you are subjected to STT, please see the bill issued by your share broker.

An item of STT will be there in the invoice raised by the broker in case security transaction tax is levied on your sale transaction.

All the transactions of equity shares executed on stock exchange are liable for STT. It is interesting to note that this exemption for long-term capital gains is not available in case the shares are sold on any stock exchanges outside India.

It is also pertinent to note that this exemption is available only in respect of equity shares listed on Indian Stock Exchange whether it is an Indian Company or a foreign company. This way say shares of Standard Chartered Bank, a foreign company, which are listed in India enjoy this exemption.

In case of profit on equity shares sold on stock exchanges in India held for less than 12 months are s taxed at a flat rate of 15 percent. It is also interesting to note that even in cases where the applicable slab tax rate is 10 percent, you will still have to pay tax of 15 percent on such short- term capital gains.

This rate still will be 15 percent even in case the slab rate applicable to you is 30 percent. In case your other income excluding this short- term capital gains is less than basic exemption limit, you will be entitled to take the benefit of such shortfall in the basic exemption limit while calculating your tax liability.

Tax in respect of capital gains arising on sale of shares other than equity shares transacted on Indian Exchange:

All transactions of shares do not take place on the plat form of stock exchange. This would cover transaction of unlisted shares as well as transactions of listed shares in the form of open offer or buy back by of these shares by the company directly.

Any capital gains arising on sale of such transactions will still be treated as long-term if the shares have been held for 12 months or more on the date of sale. In case the shares are sold within 12 months, the short-term capital gains arising on such transaction shall be included in your regular income and shall be taxed at the slab rate applicable to you.

Generally the tax-rate applicable in case of long-term capital gains is 20 percent on the indexed capital gains. However in case the long-term capital gains calculated with indexation is higher than 10 percent of unindexed capital gains, your liability on such long-term capital gains shall be restricted to 10 percent only in certain cases.

This option of choosing between 20 percent on indexed long-term capital gains or 10 percent of unindexed capital gains is available only in case of listed shares which are transacted outside stock exchange. So in case you had tendered shares of Hindustan Uniliver under buyback scheme, your liability would be restricted to 10 percent of profit made by you in case the shares were held for 12 months or more.

In case the shares sold are not listed in India, this option of choosing between 10 percent unindexed and 20 percent indexed capital gains is not available. In case your other income excluding these long-term capital gains is less than basic exemption limit, you will be entitled to take the benefit of such shortfall in the basic exemption limit here also.

However in case of short-term gains, though the shares are listed in India, your liability on such short-term gains will depend on the slab rate applicable to you.

Taxation of Dividends received on shares:

Any dividend received on shares held in Indian company is fully exempt from payment of tax. However the company is required to pay a tax called Dividend Distribution Tax on such dividend at the rate of 15 percent on such dividend. So effectively 15 percent tax on your behalf has been paid by the company on the dividends received by you.

Hope the article has eased your confusion about the taxability and the rate of tax on sale of shares. Your feedback and queries are welcome.

Source: www.moneycontrol.com

Interest, Penalty & Prosecution for Failure to Deposit Tax Deducted for Asstt. Year 2014-15

          If a person fails to deduct the whole or any part of the tax at source, or, after deducting, fails to pay the whole or any part of the tax to the credit of the Central Government within the prescribed time, he shall be liable to action in accordance with the provisions of section 201 and shall be deemed to be an assessee-in-default in respect of such tax and liable for penal action u/s 221 of the Act. Further Section 201(1A) lays down that such person shall be liable to pay simple interest

  1. at 1% for every month or part of the month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted; and
  2. at one and one-half percent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid.
          Such interest, if chargeable, is mandatory in nature and has to be paid before furnishing of quarterly statement of TDS for respective quarter.

          Section 271C inter alia lays down that if any person fails to deduct whole or any part of tax at source or fails to pay the whole or part of tax under second proviso to section 194B, he shall be liable to pay, by way of penalty, a sum equal to the amount of tax not deducted or paid by him.

Further, section 276B lays down that if a person fails to pay to the credit of the Central Government within the prescribed time, as above, the tax deducted at source by him, he shall be punishable with rigorous imprisonment for a term which shall be between 3 months and 7 years, along with fine.

Ad-hoc Bonus to RPF and RPSF for 30 days - Railway Board.

Railway Board issued orders on granting of bonus to RPF and RPSF

Railway Board has issued orders on granting ad-hoc bonus to RPF and RPSF for thirty days.
The content of the order has been given below for your information...

"Grant of ad-hoc bonus for 30 days to the Group ‘C’ & ‘D’ RPF/RPSF personnel for the financial year 2012-2013.
The President is pleased to decide that all Group 'C' & ‘D’ RPF/RPSF personnel, may be granted ad-hoc bonus equivalent to 30 (thirty) days emoluments for the financial year 2012-2013, without any eligibility wage ceiling. The calculation ceiling of  3500/- will remain unchanged.
2. The benefit will be admissible subject to the following terms and conditions:
a) Only those Group ‘C’ & 'D’ RPF/RPSF personnel who were in service on 31.32013 and have rendered at least six months of continuous service during the year 2012-2013 will be eligible for payment under these orders. Pro-rata payment will be admissible to the eligible personnel for period of continuous service during the year ranging from six months to a full year, the eligibility period being taken in terms of number of months of service (rounded to the nearest number of months).
b) The quantum of ad-hoc bonus will be worked out on the basis of average emoluments/calculation ceiling whichever is lower. To calculate ad-hoc bonus for one day, the average emoluments in a year will be divided by 30.4 (average number of days in a month). This will thereafter be multiplied by the number of days of bonus granted. To illustrate, taking the calculation ceiling of  3500/- (where actual average emoluments exceed Rs.3500), ad-hoc bonus for thirty days would work out to Rs.3500 x 30 / 30.4 = 3453.95 (rounded off to  3454/-).
c) All payments under these orders will be rounded off to the nearest rupee.
d) In the matter where the aforesaid provisions are silent, clarificatory orders issued vide this Ministries letter No.E(P&A)II-88/Bonus-3 dated 29.12.1988, as amended from time to time, would hold good.
e) All the Group C & D RPF/RPSF personnel, regardless of whether they are in uniform or out of uniform and regardless of place of their posting, shall be eligible only for ad-hoc bonus in terms of these orders.
3. This issues with the concurrence of the Finance Directorate of the Ministry of Railways".
 
Source : www.90paisa.blogspot.in

Deductions of Higher Education Loan u/s. 80E for Asstt. Year 2014-15.

Section 80E allows deduction in respect of payment of interest on loan taken from any financial institution or any approved charitable institution for higher education for the purpose of pursuing his higher education or for the purpose of higher education of his spouse or his children or the student for whom he is the legal guardian.

The deduction shall be allowed in computing the total income for the Financial year in which the employee starts paying the interest on the loan taken and immediately succeeding seven Financial years or until the Financial year in which the interest is paid in full by the employee, whichever is earlier.  For the purpose of this section -
  • "approved charitable institution" means an institution established for charitable purposes and approved by the prescribed authority section 10(23C), or an institution referred to in section 80G(2)(a);
  • "financial institution" means a banking company to which the Banking Regulation Act, 1949 applies (including any bank or banking institution referred to in section 51 of that Act); or any other financial institution which the Central Government may, by notification in the Official Gazette, specify in this behalf;
  • "higher education” means any course of study pursued after passing the Senior Secondary Examination or its equivalent from any school, board or university recognized by the Central Government or State Government or local authority or by any other authority authorized by the Central Government or State Government or local authority to do so.

Reverse Mortgage (Amendment) Scheme, 2013.

The Central Government hereby makes the following Scheme to amend the Reserve Mortgage Scheme, 2008.  This Scheme may be called the Reserve Mortgage (Amendment) Scheme, 2013 w.e.f. 07th Oct., 2013.  In this scheme the Government has insert Para (2), after clause (a) i.e. "(ab) "annuity sourcing institution" means Life Insurance Corporation of India or any other insurer registered with the Insurance Regulatory and Development Authority established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999);".  Similarly in Para (3), in sub-Para (2) for the word, brackets and number "sub-rule (1)", the word, brackets and number "sub-para (1). As well para (5) shall be substituted by "5. Disbursement of Loan. - "The approved lending institution may disburse the loan (a) to the reverse mortgagor by any one or more of the following modes"
  1. periodic payments to be decided manually between the approved lending institution and the reverse mortgagor.
  2. lump-sum payment in one or more tranches, so the extend that the aggregate of the amount disbursed as lump-sum payments does not exceed fifty percent of the total loan amount sanction or in part or in full, to the annuity sourcing institution for the purposes of periodic payments by way of annuity to be reverse mortgagor.
The Government shall be substituted para 6 as "6. period of reverse mortgage loan. - The loan under reverse mortgage shall not be granted for a period exceeding, - 1. twenty years from the date of signing the agreement by the reverse mortgagor and the approved lending institute, where the loan is disbursed in accordance with clause (a) of Para. 5; 2. the residual life time of the borrower, where the loan is disbursed in accordance with clause (b) of Para.5."

Download detailed notification (Click Here)

Mandatory Quoting of PAN and TAN on TDS Certificate for Asstt. Year 2014-15.

Section 203A of the Act makes it obligatory for all persons responsible for deducting tax at source to obtain and quote the Tax deduction and collection Account No (TAN) in the challans, TDS-certificates, statements and other documents. Detailed instructions in this regard are available in this Department's Circular No.497 [F.No.275/118/ 87-IT(B) dated 9.10.1987]. If a person fails to comply with the provisions of section 203A, he will be liable to pay, by way of penalty, under section 272BB, a sum of ten thousand rupees. Similarly, as per Section 139A(5B), it is obligatory for persons deducting tax at source to quote PAN of the persons from whose income tax has been deducted in the statement furnished u/s 192(2C), certificates furnished u/s 203 and all statements prepared and delivered as per the provisions of section 200(3) of the Act.

All tax deductors are required to file the TDS statements in Form No.24Q (for tax deducted from salaries). As the requirement of filing TDS certificates alongwith the return of income has been done away with, the lack of PAN of deductees is creating difficulties in giving credit for the tax deducted. Tax deductors are, therefore, advised to procure and quote correct PAN details of all deductees in the TDS statements for salaries in Form 24Q. Taxpayers are also liable to furnish their correct PAN to their deductors. Non-furnishing of PAN by the deductee (employee) to the deductor (employer) will result in deduction of TDS at higher rates u/s 206AA of the Act mentioned in para 4.8 below. 

Compulsory Requirement to furnish PAN by employee (Section 206AA):

Section 206AA in the Act makes furnishing of PAN by the employee compulsory in case of receipt of any sum or income or amount, on which tax is deductible. If employee (deductee) fails to furnish his/her PAN to the deductor , the deductor has been made responsible to make TDS at higher of the following rates:

  1. at the rate specified in the relevant provision of this Act; or
  2. at the rate or rates in force; or
  3. at the rate of twenty per cent.

The deductor has to determine the tax amount in all the three conditions and apply the higher rate of TDS. However, where the  ncome of the employee computed for TDS u/s 192 is below taxable limit, no tax will be deducted. But where the income of the employee computed for TDS u/s 192 is above taxable limit, the deductor will calculate the average rate of income-tax based on rates in force as provided in sec 192. If the tax so calculated is below 20%, deduction of tax will be made at the rate of 20% and in case the average rate exceeds 20%, tax is to deducted at the average rate. Education cess @ 2% and Secondary and Higher Education Cess @ 1% is not to be deducted, in case the tax is deducted at 20% u/s 206AA of the Act.