What is New in Income Tax from 1st April regarding Saving your Money.

What is New in Income Tax from 1st April regarding Saving your Money.

This income tax rule will change from 1st April! Save your money, here is how

Income Tax Calculator: Finance Minister Nirmala Sitharaman announced in Budget 2021 that income tax rule for TDS (Tax Deducted at Source) will get changed from the new fiscal, which means from 1st April, 2021. As per her budget speech, if a person doesn't file income tax return (ITR), then in that case, the TDS interest rate on one's bank deposits would be charged double. That means, even if an earning individual doesn't fall in the income tax outgo slab, if he or she doesn't file ITR, then TDS rate will double on the earning individuals.

Elaborating upon the change in income tax rule on TDS and TCS for an earning individual who don't file ITR, SEBI registered tax and investment expert Jitendra Solanki said, "In order to discourage the practice of not filing income tax returns by the persons in whose case substantial amount of tax has been deducted or collected, the union budget proposal says that a person in whose case TDS/TCS of Rs 50,000 or more has been made for the past two years and who has not filed ITR, the rate of TDS/TCS shall be at the double of the specified rate or 5 per cent, whichever is higher. This provision shall not be applicable for the transactions where full amount of tax is required to be deducted e.g. salary income, payment to non-resident, lottery, etc."

On whether the TDS interest rate would be applicable on the senior citizens who are more than 75 years, Pankaj Mathpal, Managing Director, Optima Money Managers said, "Budget 2021 allows non-filing of ITR for those super senior citizens who have a single income source of pension. If a 75 plus year old person has a source of income other than pension too, then in that case the super senior citizen will have to file ITR and avoid double TDS interest rate charge being levied on them."

Source: ZeeBusiness

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Easy Steps to Upload Income Tax Return A.Y. 2017-18

Upload Income Tax Return A.Y. 2017-18

To Upload ITR , please follow the below steps:

Step - 1 :  Download the ITR preparation software for the relevant assessment year to your PC / Laptop from the "Downloads" page.

Step - 2 :  Prepare the Return using the downloaded Software.

Gather all the information regarding your income, tax payments, deductions etc.Pre-populate the personal details and tax payments/TDS by clicking on the 'Pre-fill' button. Compare with the information you have to ensure that nothing is left out.Enter all data and click on 'Calculate' to compute the tax and interest liability and final figure of Refund or Tax payableIf Tax is payable- remember to pay immediately and enter the details in appropriate schedule. Repeat above step so that tax payable becomes zeroGenerate and save the Income Tax Return data in XML format in the desired path/place on your PC/Laptop.

Step - 3 :  Login to e-Filing website with User ID, Password, Date of Birth /Date of Incorporation and enter the Captcha code.

Step - 4 :  Go to e-File and click on "Upload Return".

Step - 5 :  Select the appropriate ITR, Assessment Year and XML file previously saved in Step 2 (using browse button).

Step - 6 :  Upload Digital Signature Certificate (DSC), if applicable.

Please ensure the DSC is registered with e-Filing.

Step - 7 :  Click on "Submit" button.

Step - 8 :  On successful submission, ITR-V would be displayed (if DSC is not used). Click on the link and download the ITR-V. ITR-V will also be sent to the registered email. If ITR is uploaded with DSC, the Return Filing process is complete.
OR
The return is not uploaded with DSC, the ITR-V Form should be printed, signed and submitted to CPC within 120 days from the date of e-Filing. The return will be processed only upon receipt of signed ITR-V. Please check your emails/SMS for reminders on .non-receipt of ITR-V.

Upload Income Tax Return process is complete now.

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Latest e-Hand Book on Revised GST Law - CA Pritam Mahure.

The Central Government is targeting to implementation the new indirect tax system w.e.f. April 1st, 2017, its called GST.

"The revised drafts of the Model GST Law, iGST Law, GST Compensation Law have been uploaded on our website (Central Board of Excise and Customs). These laws will be considered by the GST Council on December 2-3 and finalized,"

The revised drafts of three Goods and Service Tax laws have been released after incorporating suggestions from stakeholders, the government said on Saturday. These will now be placed before the Goods and Services Tax Council in its next meeting on December 2 and 3.

Revised GST law containing :

• Revised Model CGST /SGST Law
• Revised IGST Law
• GST Compensation Cess Law
• GST Rules for registration, payment, return, refund and invoices.

To Download Latest Free e-Handbook on Revised GST Law Click Here

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Bank Reported to CBDT about Cash Transaction Above Rs. 2.5 Lacs - Notification

MINISTRY OF FINANCE

(Department of Revenue)

(CENTRAL BOARD OF DIRECT TAXES)

NOTIFICATION

New Delhi, the 15th November, 2016

G.S.R. 1068(E).—In exercise of the powers conferred by section 285BA, read with section 295 of the Incometax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income–tax (30thAmendment) Rules, 2016.
   (2) They shall come into force from the date of their publication in the Official Gazette.

2. In the Income-tax Rules, 1962 (hereinafter referred to as the said rules), in rule 114B, in the Table, for serial number10 and entries relating thereto the following serial number and entries shall be substituted, namely:-

3. In the said rules, in rule 114E, —
(i) in sub-rule (2), in the Table, after serial number11 and entries relating thereto the following serial number and entries shall be inserted, namely:-

(ii) in sub-rule (5), the following proviso shall be inserted, namely:-
“Provided the statement of financial transaction in respect of the transactions listed at serial number (12) in the Table under sub-rule (2), shall be furnished on or before the 31st day of January, 2017.”.

[Notification No. 104/2016/F. No. 370142/32/2016-TPL]

Dr. T.S. MAPWAL, Under Secy.

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Tax implications of fixed deposits

If you are in the higher tax bracket, that is 20% or 30%, make sure that you pay the additional interest before filing your tax returns.

The biggest disadvantage of FDs is that the interest earned is subject to taxation. This eats into the returns.

Taxed as per income bracket

The interest earned on the FDs is added to the depositor's income and taxed as per income bracket. This reduces its attractiveness, especially for those in the highest tax bracket.

Pay tax even if bank cuts TDS

The bank will cut the tax at source (Tax Deducted at Source) before paying the interest, if the interest exceeds Rs 10,000 in a financial year.  But this is at the marginal rate of 10%. If you are in the higher tax bracket, that is 20% or 30%, make sure that you pay the additional interest before filing your tax returns. This is a common mistake most depositors do. It is a hassle if you receive a notice from the Income-Tax department for non payment of taxes. You will have to prove that not paying the tax was not deliberate and you may have to pay tax plus the penalty for the delay.

For ensuring that the bank has deducted TDS on your FD by checking Form 26AS. But sometimes if the bank deducts TDS but fails to submit the same to the I-T department, you may still get a notice.

If your PAN card details are not updated with the bank, the TDS will be deducted at 20%. And if you are in the 10% tax bracket, this will mean having to file for refund while filing tax returns, which can be a hassle. These are some of the things to keep in mind.

Form 15G and 15H

If your income is below the taxable limit and you have no then submit Form 15G to avoid TDS. For senior citizens whose income is below the taxable limit the form is 15H.

Reduce your TDS

You can also reduce your TDS by spreading your deposits across several banks so that the interest earned in a financial year remains less than Rs 10,000. But this will only reduce the TDS. You will still have to pay income tax as per your tax bracket.

Source: Business Standard

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Total Income Tax Provisions.

Tax laws are like a web. The more you try to understand it, you find more getting tangled into. For a layman it is very difficult to memorize all the provisions of Income Tax due to its vast coverage and twists in all the provisions. Therefore, taxpayers many times find themselves in trouble. Although it is not possible for every assessee to go through all the provisions, still all must have basic knowledge.   eight-ways-family-can-help-you-save-tax-legally

We here bring A TO Z OF INCOME TAX PROVISIONS AT A GLANCE:

GENERAL

1. Detailed information of Income Tax is available on www.incometaxindia.gov.in
2. As per Income Tax Act, Income is taxable under five heads- Salary, House Property, Business or Profession, Capital Gain and Other Sources.
3. Accurate Stock Valuation should be done on 31st of March.
4. Cash payment should not be made to a person in single day exceeding Rs.20,000.
5. Cash Payment limit for Transporters is Rs.35,000.
6. Loans, deposits and Immovable Properties transactions should not be carried out above Rs.20,000 in cash.
7. Business loss can be carried forward to Next 8 Years.
8. From FY 2014-15 Depreciation is to be calculated as per New Companies Act.
9. Domestic Transfer Pricing is applicable on transaction exceeding an Amount Rs.20 Crores.

SALARY

1. Salaried person must obtain Form 16 from his Employer Every Year.
2. Income Tax Return should be filed by considering Form 16 and other Income.
3. Transport Allowance is exempt up to Rs.1,600 per month.
4. LTC or LTA is exempted if the same is actually spent.
5. Children Education Allowance is available for children of employees. Maximum exemption available is Rs. 100 per month per child up to a maximum of 2 children.
6. House Rent Allowance

When rent is actually paid by an individual, he / she is entitled to exemption in respect of House Rent Allowance which is limited to least of the following:

• Actual HRA received
• Rent paid less 10% of salary
• 40% of Salary (50% in case of Mumbai, Chennai, Kolkata, Delhi)

*Salary is defined as Basic Pay. Dearness allowance will form part of salary if the same enters into computation of retirement benefits.

7. HOUSE Property

1. 30% Standard deduction is available on Income from House Property.
2. Income to be considered as deemed let out on second House property.
3. For self-occupied house property, deduction of Interest on Housing Loan is allowed up to Rs. 200,000/- and for other house property actual expenditure of Interest on Housing Loan is allowed.
4. Repayment of Principal amount of Housing Loan is deductible u/s 80C up to Rs.150,000/-.

TAX AUDIT

1. Tax Audit is compulsory if sales turnover exceeds Rs.1 crore in case of business.
2. Tax Audit is compulsory if the Gross Receipts of Professionals exceeds Rs.25 lakhs.
3. If sales turnover is below Rs. 1 crore, then net profit of 8% or higher is to be taken as business income otherwise tax audit is required.
4. The Due Date for Tax Audit and income Tax Return is 30th September.
5. Assessee other than Company and those eligible for Tax Audit are required to file Income Tax Return before 31st July. Extended date is 31st August for F.Y. 2014-15.

TDS

1. Tax Audit applicable assesses should deduct TDS on particular transactions.
2. TDS should be made on the date of Credit or Payment basis of whichever is earlier.
3. TDS payment should be made on or before 7th day of Next Month.
4. TDS Returns are to be filed Quarterly.
5. TDS returns can be revised any number of times.
6. TDS should be deducted and paid if applicable.
7. If TDS is not deducted then deduction of 30% of Expenditure is not allowed.
8. Late filling of TDS return attracts late filing fees of Rs. 200 per day.

CAPITAL GAIN

1. Long Term Capital Gain will arise if transfer of specified Capital Assets is made after 3 years.
2. Generally Long Term Capital Gains is taxable @ 20%
3. STT paid Long Term Capital Gain on Shares, etc is exempt from Tax.
4. Short Term Capital Gain is Taxable @ 15% if STT is paid.
5. Capital Gain on Immovable Properties is chargeable at Stamp Duty Value or Selling Price whichever is higher.
6. Dividend received from domestic company is exempt from Tax.
7. Agricultural Income is exempt from Tax.

TAX ON GIFTS

1. Gifts received form stranger of an Amount exceeding Rs.50,000 is taxable.
2. Income Tax is not chargeable on Gifts received at the time of Marriage, Will, and in case of Succession and from specified relatives.

DEDUCTIONS

1. Maximum deduction limit u/s 80C, 80CCC and 80 CCD is Rs.1,50,000.
2. Deduction of Medical Insurance Premium is available up to Rs. 25,000.
3. Deduction of Medical Insurance Premium paid for Parents is available up to Rs. 20,000.
4. Deduction limit of Interest earned on Saving Account is up to Rs.10, 000.
5. Income earned by a Minor child is clubbed in the hands of Parents.
6. Every Taxpayer should verify his Form 26AS.
7. Form 26AS provides the Information regarding the TDS, Advance Tax paid and details of refund.
8. Notice may be sent to the Taxpayer if the Income mentioned in Form 26AS and the Income Tax Return filed is having difference.

EXEMPTIONS AND TAXES

1. Basic Exemption Limit for individuals for FY2015-16 is Rs.2,50,000.
2. Basic Exemption Limit for Senior Citizen i.e. above 60 years age is Rs.3,00,000.
3. Basic Exemption Limit for Super Senior Citizen i.e. above 80 years age is Rs.5,00,000.
4. If taxable income of Individual is less than Rs. 5 Lakhs then relief of Rs.2,000 is available in Tax.
5. Advance Tax is to be paid if Tax Liability during the year exceeds Rs. 10,000.
6. 12% of Surcharge is applicable if Income Exceeds Rs. 1Crore.
7. Income Tax Return should be filed if Income exceeds Basic Exemption Limit.
8. 30% of Tax applicable on Income of Partnership Firm, Company, LLP etc.
9. For Companies – Minimum Alternate Tax and for other Assesses– Alternate Minimum Tax rate is 18.5%.

INCOME TAX RETURN

1. Details of all Bank Accounts have to be given in Income Tax return.
2. Passport number is required to be given in Income Tax return.
3. Detail of Fixed Assets held in Foreign Country is required to be given in Income Tax return.
4. Aadhar Card No. is required to be mentioned in Income Tax return.
5. E-filling of return is compulsory if income exceeds Rs. 5 lakhs.
6. In Income Tax, E-filling of return can be done for Previous 2 Years only.
7. PAN Card is essential for Taxpayer and it should not be used as Id Proof.

Source: www.taxmantra.com by Mr. Alok Patnia

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Rate of Service Tax and Swachh Bharat Cess for Fin. Year 2015-16

In the first full year budget 2015-2016, Hon'ble Prime Minister Modiji and Mr. Jaitley has tried to boost the confidence of people by giving many exemptions, pension schemes and so on. However, to meet all these expectations there must be increase in government's revenue. To meet the requirement of revenue, the rate of service tax which is currently 12.36% (inclusive of Education Cess and Higher & Secondary Education Cess) has been proposed to be increased to 14%. The increased rate of 14% will come into effect from the date to be notified after the enactment of Finance Bill.

The new chapter VI has also been added for introduction of "Swachh Bharat Cess".The relevant text of chapter VI of fianance bill reads as under.

"117(2) There shall be levied and collected in accordance with the provisions of this chapter, a cess to be called the Swachh Bharat Cess, as service tax on all or any of the taxable seervices at the rate of two per cent on the value of such serevices for the purposes of financing and promoting Swachh Bharat initiatives or for any other purpose relating thereto.

(3) The Swachh Bharat Cess leviable under sub-section (2) shall be in addition to any cess or service tax leviable on such taxable services under chapter V of the Fiance Act, 1994, or under any other law for the time being in force."

Swachh Bharat Cess will be 2% on all or any of the taxable services in addition to the service tax. Therefore, it may be imposed on all the taxable services or it may be imposed only on the selective services. The statutory provisions will be amendmed accordingly. It will be used for financing and promoting Swatchh Bharat initiatives or for any other purposes relating to Swatchh Bharat. It will come into effect from the date to be notified after the enactment of Finance Bill.

Therefore, overall increase in rate of service tax is approximately3.64%. This increase in rate of service tax shows that government is gearing up for GST and I feel that it is sign of GST percentage which will be between 16% to 19%. This is step towards fixation of GST percentage and simultaneously preparing the service segment for higher percentage.

It is to be noted that till the timedate has not been notified for increase in rate of service tax, there is no change in it. It will be same i.e. 12% service tax, 2% education cess on service tax and 1% Higher & Secondary education cess on service tax.

Only after the enactment of finance bill, the date will be notified and from the notified date the rate of service tax &Swachh Bharat Cesswill be as follows.

  ➢ Service Tax – 14%

  ➢ Swachh Bharat Cess – 2% in addition to service tax.

It is to be noted that from the date to be notified after enactment of finance bill, there will not be any education cess or higher & secondary education cess seperately.

The effect of increase in rate of service tax will be triggered by rule 4 of the Point of Taxation Rules. The applicability of change in rate of service tax &Swachh Bharat Cess (SBC) under different situation is analysed below. While analyzing the different situations below, it is assumed that rules for point of Taxation has been amended accordingly to apply to SBC and SBC has also been levied and imposed on all taxable serviceson the same date.

Scenario 1 - In case where Taxable services are provided before the date to be notified after the enactment of Finance Bill

Scenario 2 - In cases where Taxable services are provided after the date to be notified after the enactment of Finance Bill

The alternative service tax rates has been provided under Rule 6 of Service Tax Rules, 1994 with repsect to the services provided by Air Travel Agent, Insurance Service, Money Chaging, Lottery Distributor & Selling Agent. Consequent to the increase in rate of service tax, alternative rate has also been increased proportionately. This will also come into effect when the new rates of service tax comes into effect.

 (a) New rate of service tax on Air Travel Agent will be as follows.

  ➢ 0.7% of the basic fare in the case of domestic bookings.

  ➢ 1.4% of the basic fare in the case of international bookings.

 (b) Rate of service Tax on Life Insurance business will be as follows.

  ➢ 3.5% of the premium charged from policy holder in the first year and

  ➢ 1.75% of the premium charged from policy holder in the subsequent years.

 (c) Rate of Service Tax on purchase and sale of Foreign Currency will be as follows.

The rate of service tax on purchase and sale of foreign currency has been also been increased proportionately and the slab-wise rate chart is as follows.

(d) Rate of Service Tax on promotion, marketing, organising or in any other manner assisting in organising lottery will be as follows.

The rate of service tax on promotion, marketing, organising or in any other manner assisting in organising lottery has been increased proportionately and the new slab-wise rate chart is as follows.

In all the above cases enumerated in points a) to d) Swachh Bharat Cess will be additionally levied.

This increased rates of service tax reminds me the wordings of "Benjamin Franklin"

"Nothing is certain but death and Tax".

Source: www.taxmann.com

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Income tax department to act tough with non-filers.

NEW DELHI: The income tax department is urging its officials to step up prosecution of "wilful" evaders and non-filers as part of a strategy to plug loopholes and ensure much-needed revenues for the government which is battling an economic slowdown.

The department is also revamping its approach to search and survey operations. Officials are being asked to focus on detection of undisclosed income and assets by working diligently on the evidence gathered and also accessing additional information. The category of non-filers is a key one for tapping unpaid taxes and the department has met with success after launching a drive to detect non-filers of tax returns.

The focus should shift to launching successful prosecution in appropriate cases instead of concentrating only on disclosure of additional income and making recommendations to the assessing officers. A new policy on the issue is expected to be unveiled shortly.

However, the department is making sure that search and seizure operations are handled with utmost care to avoid any controversies. While search and seizure operations are intended to be used "judiciously", there is an overwhelming view that it's an effective deterrence tool against tax evasion and for improving compliance.

However, the officials say that the objectives of cutting down evasion and improving compliance would be achieved when search and seizure actions are followed through with "civil and criminal proceedings, levy of due interest and penalties and prosecution of tax evaders expeditiously".

The Narendra Modi government has promised to transform the image of the tax department and has urged the field officers to ensure that they follow a non-adversarial approach to collecting taxes. Finance minister Arun Jaitley has also asked the officers to deal sternly with tax evaders.

A review by the department of the search and seizure operations has thrown up startling results which has triggered the reworking of strategy by the top officials. According to a tax department discussion document, it is "...necessary to focus on creating effective deterrence in such cases through proper assessments, penalty and prosecution. There is an urgent need to cut down inordinate delays at every level and introducing a system which does not allow shifting of responsibility between the officers conducting the search and those completing the assessments and subsequent actions".

Source: www.timesofindia.indiatimes.com

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Impact of Budget-2014 on Income Tax, Excise Duty, Service Tax, Custom Duty and others for Asstt. Year 2015-16

The Finance Minister announced the Union Budget for Fin. Year 2014-15 i.e. Asstt. Year 2015-16 on 10th July, 2014.  In this Budget the Finance Minister is trying to give better results of revenue for Government as well as get benefit to all Indians.  The analytical clarification of Budget-2014 which Impact's on  Income Tax, Excise Duty, Service Tax, Custom Duty and others for Asstt. Year 2015-16 are as under:

Income Tax Proposals

• Income Tax exemption limit increases from Rs. 2 lacs to Rs. 2.5 lacs in the case of individual taxpayers who are below the age of 60 years.
• Income Tax exemption limit increases from Rs. 2.5 lacs to Rs. 3 lacs in the case of senior citizens. 
• Deduction of investments made under section 80C increases from Rs. 1 lacs to Rs. 1.50 Lacs.
• Investment allowance of 15% to a manufacturing company will be given who invests more than Rs. 25 Crore in any year in new plant & machinery. This benefit will be available for three years i.e. for investments made upto 31.03.2017.
• Extention of Investment linked deductions to new sectors namely, slurry pipelines for the transportation of iron ore, and semi- conductor water facbrication manufacturing units.
• Deduction of Interest on housing loan increases to Rs. 2 Lacs from Rs. 1.50 Lacs in the last year.
• Extention of 10 years tax holiday to power companies which begins generation, distribution and transmission of power by 31st March’2017.
  
• Increase in ceiling limit of PPF investment to Rs. 1.50 Lacs from Rs. 1.00 Lacs.
• Government will review Direct Tax Code Bill, 2011 and take view in the related matter of introduction.
• Tax deducted at source (TDS), not deducted on specified payments to residents will now be disallowed to the extent of only 30 percent while computing taxable income.
• Mutual funds other than equity oriented funds will attract rate of tax of 20 percent on long term capital gains as compared to 10 percent prevailing. Budget also proposes to increase period of holding of such units to 36 months from 12 months.
• Corporates and Mutual funds are now required to pay income distribution tax on gross income distributed.
• Budget speech clears that Government will not ordinarily bring about any changes in tax regime retrospectively which creates a fresh liability. all fresh cases arising out of the retrospective amendments of 2012 in respect of indirect transfers and coming to the notice of the Assessing Officers will be scrutinized by a High Level Committee to be constituted by the CBDT before any action is initiated in such cases.

Excise Duty Proposals

• Excise Duty on cigarettes, cigars and cigarillos increased in the range of 11 percent to 72 percent.
• Excise Duty on pan masala increased from 12 percent to 16 percent.
• Excise Duty on Guthka and chewing tobacco increased from 60 percent to 70 percent.
• Excise Duty on specified food processing and packaging machinery reduced to 6 percent from 10 percent.
• Footwears having retail selling price ranging between Rs. 501 to Rs. 1000 will be levied duty @ 6 percent as compared to 12 percent presently charged. Footwears having retail selling price upto Rs. 500 will remain exempt from duty.
• Excise Duty on unmanufactured tobacco increased from 50 percent to 55 percent.
• Exemption provided from Excise Duty to the below mentioned products:
• EVA sheets and solar back sheets and specified inputs used in their manufacture.
• Solar tempered glass used in the manufacture of solar photovoltaic cells and modules.
• Flat copper wire for the manufacture of PV ribbons for use in solar cells and modules.
• Machinery & Equipments required for setting up of a solar energy production project.
• Forged steel rings used in the manufacture of bearings of wind operated generators.
• Machinery & Equipments required for setting up of compressed biogas plants(Bio-CNG)

• Government exempts duty on PSF and PFY manufactured from plastic bottles, for the period 29th June, 2010 to 7th May, 2012. Now PSF and PFY will attract duty @ 2 percent without and @6 percent with Cenvat benefits on such products.
• Sports gloves will now attract duty of 2 percent without Cenvat benefit and 6 percent with Cenvat benefits on such products.

Service Tax Proposals

• Now, online and mobile advertisements of sale of space or time for advertisements will also be covered under purview of Service Tax.
• Service provided by radio-taxis will also attract service tax with rent a cab service. (Applicable w.e.f. date of passing of Bill by president)
• Services by Air Conditioned Contract Carriages & technical testing of newly developed drugs on human participants to be taxable.
• Micro Insurance Scheme will also include all life insurance schemes where the sum assured does not exceed Rs. 50000 per life insured. Micro Insurance Scheme is covered under exemption list therefore it does not attract Service Tax.„Ï Services provided by Indian tour operators to foreign tourists in relation to a tour wholly conducted outside India is not taxable.
• Cenvat Credit will be allowed to service providers of rent-a-cab, tour operators and same line of business.
• Services of loading, unloading, storage, warehousing & transportation of cotton, whether grinned or baled is being exempted
• Services provided by common biomedical waste treatment facilities are being exempted.
• Following changes will be noted in respect of reverse charge mechanism (RCM) of Service Tax:

• Following changes are made in valuation rules of Service Tax w.r.t. works contract service:

• Changed mechanism of interest payable for delayed payment of Service Tax are as under:

• Service Tax payment will be made through internet banking by every assessee w.e.f. 01st Oct, 2014. (Exceptional permission from AC/DC will be required for otherwise payment mode)

Custom Duty Proposals 

Basic Custom Duty (BCD) reduced on below mentioned products:

• Fatty acids, crude palm stearin, RBD and other palm stearin, specified industrial grade crude oils from 7.5 percent to Nil for manufacture of soaps and oleo-chemicals.
• Crude glycerin from 12.5 percent to 7.5 percent and crude glycerine used in the manufacture of soaps from 12.5 percent to Nil.
• Steel grade limestone and steel grade dolomite from 5 percent to 2.5 percent. Battery waste and battery scrap from 10 percent to 5 percent. Coal tar pitch from 10 percent to 5 percent.
• Specified inputs for manufacture of spandex yarn from 5 percent to Nil.

Imposition of Basic Customs Duty at 10 percent on specified telecommunication products that are outside the purview of the Information Technology Agreement and education cess on imported electronic products.

• Exemption of 4 percent special additional duty (SAD) for all inputs/components used in the manufacture of personal computers and on PVC sheet and ribbon used for the manufacture of smart cards.
• BCD reduced from 10 percent to Nil on LCD and LED TV panels of below 19 inches.
• BCD increased on imported flat-rolled products of stainless steel from 5 percent to 7.5 percent.
• Increase in duty free entitlement for import of trimmings, embellishments and other specified items from 3 percent to 5 percent of the value of their exports.
• Free baggage allowance increased to Rs. 45000 from Rs. 35000. Other Important Announcements.
• Government will set up a High Level Committee to interact with industry on a regular basis and ascertain areas where clarity in tax laws is required. Based on the recommendations of the Committee, the Central Board of Direct Taxes and the Central Board of Excise and Customs shall issue appropriate clarifications, wherever considered necessary, on the tax issues within a period of two months.

Indian Accounting Standards (Ind AS) will be adopted by the Indian companies from the financial year 2015-16 voluntarily and from the financial year 2016-17 on a mandatory basis.

• Budget reintroduces Kissan Vikas Patra (KVP) instrument to encourage people, who may have banked and unbanked savings to invest in this instrument.
• Budget also proposes extend a liberalized facility of 5% withholding tax to all bonds issued by Indian corporate abroad for all sectors and extend the validity of the scheme to 30.06.2017.
• Budget recommends to follows single “Know Your Customer” norms for all financial services in the country.
• Budget recommends to use single “Demat Account” for all financial transaction.
• Budget proposes 49 percent FDI in insurance sector through FIPB.
• Clean energy cess increased from Rs. 50 per tonne to Rs. 100 per tonne on coal, peat and lignite.
• Government will look after for a solution which enables introduction of Goods & Service Tax (GST) by this year.

Source: www.caclubindia.com

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Nine reasons for getting an Income Tax Notice.

Avoid making these mistakes if you don't want a notice from the income tax department, says Sudhir Kaushik. 

The Income Tax Department has launched a drive to ensure greater tax compliance. In recent months, thousands of taxpayers have been served notices after discrepancies were noted in their tax returns or their TDS details. This sudden rise in the number of tax notices is not because people have stopped paying tax or filing their returns. It's just that the tax authorities now have an integrated database on taxpayers and can track all financial transactions. Here are some common reasons for getting a notice. 

Not mentioning PAN or quoting incorrect PAN 

The PAN is now mandatory for high-value transactions . If you do not submit it while making an investment or taking up a job, your income will be subjected to a higher TDS of 20%, instead of 10%. If the PAN is incorrect, you could even be slapped with a penalty of up to 10,000. The bigger problem of an incorrect PAN is that the TDS will not be credited to your account. What's more, the tax refund can be credited to another account if you submit the wrong PAN. 

Not checking Form 26AS before filing 

The Form 26AS has details of the tax paid by an individual during a financial year. You can easily access your Form 26AS online. Some banks also provide this facility to their Net banking customers. If your bank, bond issuer or employer has deducted TDS, make sure it is mentioned in your Form 26AS. Also, check whether all the investments with TDS have been duly mentioned in the tax return. Any mismatch will lead to a notice from the department. 

Mismatch in income and expenses & investments 

Financial services firms, registration authorities and merchant establishments are supposed to report certain high-value transactions to the CBDT. The Income Tax Department gets all information on the basis of your PAN. The CASS matches this information with the returns filed by the taxpayer and promptly issue a notice if there is a mismatch in the income you have declared and your investments and spending. 

Not filing returns if income is above 2 lakh 

If your gross taxable income before deduction under any section is above 2 lakh, it is mandatory for you to file your return. If you don't file it, you can be slapped with a penalty of up to 300% of the outstanding tax. Even if there is no tax liability, you have to file the return if the gross income before various deductions is more than the basic exemption limit. 

Not filing return by the due date 

You can file your income tax return till the end of the assessment year if there is no tax due. For example, the tax return for 2012-13 can be filed till 31 March 2014 without incurring any penalty if the tax has been paid. But if some tax remains unpaid, filing your return after the deadline could lead to a penalty of 5,000. Also, you are not allowed to carry forward losses or revise the return if you file after the due date. 

Not declaring the previous employer's income 

This is a common problem and was easily missed by the tax authorities in the past. However, now that the tax database has been integrated , don't think you can ignore your income from a previous job. If your employer deducted TDS on your income, the details would be in your Form 26AS, and the CASS will immediately flag this discrepancy. You can be levied a penalty of up to 300% of the tax evaded. 

Avoiding TDS by misusing Forms 15G and 15H 

If the interest income on bank deposits exceeds 10,000 a year, the bank deducts TDS. You can avoid TDS by submitting Form 15G or 15H if you are not liable to tax. However, if you are trying to avoid TDS, you can get a notice from the tax department. Submitting a wrong declaration can invite a penalty of 10,000. Splitting the deposits in different banks or branches to avoid TDS won't help as the PAN gives you away. 

Not declaring interest on deposits and savings 

The interest earned on bonds, fixed deposits, recurring deposits and savings accounts is taxable and should be mentioned in your tax return. Up to 10,000 earned on your savings bank account is tax-free, but it still needs to be included in your total income for the year. Likewise, the PPF interest income is tax-free, but should be included in the exempt income. 

Interest on savings account is exempt up to 10,000 for the assessment year 2013-14 while interest from post office savings is exempt up to 4,000, or 8,000 for joint accounts. 

Not responding to notice from tax department 

Don't ignore the messages and notices from the tax department. If you do not respond, the interest and penalty keeps on increasing in case of any pending tax liability and the Income Tax Department will take a final decision that may not be beneficial for you.

Source: www.timesofindia.indiatimes.com

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"Tax Your Brain" - TV Quiz Show by Income Tax Department

The Directorate of Income Tax (PR , PP & OL) has produced a twelve episode quiz show on NDTV 24 x 7 called "Tax Your Brain" with a view to communicate with the school children and youth of the country on the "need for taxation in civil society".

The quiz show will feature 32 teams from 32 different cities of the country. These cities have been divided into 8 zones. Written tests were conducted in 32 cities, covering nearly 10,000 schools and the winner teams are representing their respective cities. Mr. Saurav Ganguly, ex-India cricket captain is the quiz master.

The show will be telecast every Saturday at 7.30 PM on NDTV 24x7.

For more details (Click Here)

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All Tax Payers, other than Individuals, are requested to update Principal Contact details.

Income Tax department requested to All Tax Payers, other than Individuals, for update Principal Contact details and update their Digital Signature Certificate (DSC) as early as possible.  This requirement is very important for all operations regarding upload online/offline Income Tax Return, Income Tax Refund, To view Tax Credit Statement (Form 26AS), Check status and online/offline communication.

The Income Tax Department further suggest to Tax Payers that the updates data will help to tax payers in future key features in Online Tax Composition, Refund, e-Payment, demands etc. This process save times and labor work of Income Tax Department and All Tax Payers, other than Individuals.

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Payment of Income Tax by Book Entry or by Income Tax Challan.

Payment of Income Tax by Book Entry:

In the case of an office of the Government, where tax has been paid to the credit of the Central Government without the production of a challan [Book Entry], the Pay and Accounts Officer or the Treasury Officer or the Cheque Drawing and Disbursing Officer or any other person by whatever name called to whom the deductor reports the tax so deducted and who is responsible for crediting such sum to the credit of the Central Government, shall-

(a)    submit a statement in Form No. 24G within ten days from the end of the month to the agency authorized by the Director General of Income-tax (Systems) [TIN Facilitation Centres currently managed by M/s National Securities Depository Ltd.] in respect of tax deducted by the deductors and reported to him for that month; and

(b)    intimate the number (hereinafter referred to as the Book Identification Number or BIN) generated by the agency to each of the deductors in respect of whom the sum deducted has been credited. BIN consist of receipt number of Form 24G, DDO sequence number and date on which tax is deposited.

The procedure of furnishing Form 24G is detailed in Annexure IV. PAOs/DDOs should go through the FAQs therein to understand the correct process to be followed.

Payment Income Tax by an Income Tax Challan:

(i)                 In such a case the amount of tax so deducted shall be deposited to the credit of the Central Government by remitting it within the time specified in Table 4.4.1 above into any branch of the Reserve Bank of India or of the State Bank of India or of any authorized bank;

(ii)               In case of a company and a person (other than a company), to whom provisions of section 44AB are applicable, the amount deducted shall be electronically remitted into the Reserve Bank of India or the State Bank of India or any authorised bank accompanied by an electronic income-tax challan.

The amount shall be construed as electronically remitted to the Reserve Bank of India or to the State Bank of India or to any authorized bank, if the amount is remitted by way of:

(a)    internet banking facility of the Reserve Bank of India or of the State Bank of India or of any authorized bank; or

(b)    debit card (Notification No.41/2010, dated 31st May, 2010)

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TDS on Payment of Contractors and sub-Contractors.

SECTION 194C OF THE INCOME-TAX ACT, 1961 - DEDUCTION OF TAX AT SOURCE - PAYMENTS TO CONTRACTORS & SUB-CONTRACTORS - DEDUCTION OF TAX AT SOURCE ON PAYMENT OF GAS TRANSPORTATION CHARGES BY THE PURCHASER OF NATURAL GAS TO THE SELLER OF GAS

Circular No. 9/2012 [F. No. 275/11/2012-IT(B)], dated 17-10-2012

Representations have been received from various sections of the Industry on the difficulties faced in the matter of Tax Deduction at Source on Gas Transportation Charges paid by the purchasers of Natural gas to the sellers of gas.

2. The Hon'ble Gujarat High Court in the case of CIT (TDS) v. Krishak Bharati Cooperative Limited in Tax Appeal No. 618 of 2010 vide order dated 12-7-2011, has held that the question as to whether payment of Gas Transportation Charges by the purchasers of Natural gas to the Gas Distribution Companies is covered under the provision of Chapter XVII-B of Income-tax Act, 1961 (the Act) or not, can be ascertained only on the basis of the terms of agreement between the Gas Distributing Company and the purchaser of the Natural gas. In the operative part of the order, the Hon'ble Court says that in the facts of the abovementioned case, the agreement is for purchase and sale of gas. Transportation of gas is only a part of the entire sale transaction. Laying down the pipeline and supplying gas through such pipeline were the steps taken in furtherance of such a contract. There was a clear understanding of the parties that the ownership of gas would pass on to the buyer at the delivery point which clearly shows that transport of gas by the seller was a step towards execution of contract for sale of gas and there was no contract for carriage of goods. The Court added that Transportation of gas was only in furtherance of contract for sale of gas. The Hon'ble High Court then decided that in such a case the supply of gas is under a 'contract for sale' and not under a 'works contract' as envisaged under section 194C of the Act and hence in such a case TDS provisions are not applicable.

3. The matter has been examined by the Board. The main stakeholders in this Industry are the - Owners/Sellers of the gas (which could be a Gas Distribution Company); Transporters of gas (which could be the Owners/Sellers of the gas or a third party/parties) and the purchasers/ end-users of the gas. The Owner/Seller of the gas may transfer the ownership of the gas to the purchaser either at the point of delivery at the premises of the purchaser or at any intermediate point.

4. It is clarified that in case the Owner/Seller of the gas sells as well as transports the gas to the purchaser till the point of delivery, where the ownership of gas to the purchaser is simultaneously transferred, the manner of raising the sale bill (whether the transportation charges are embedded in the cost of gas or shown separately) does not alter the basic nature of such contract which remains essentially a 'contract for sale' and not a 'works contract' as envisaged in section 194C of the Act. Hence in such circumstances, provisions of Chapter XVII-B of the Act are not applicable on the component of Gas Transportation Charges paid by the purchaser to the Owner/Seller of the gas. The use of different modes of transportation of gas by Owner/Seller will not alter the position.

5. It is needless to mention that transportation charges paid to a third party transporter of gas, either by the Owner/Seller of the gas or purchaser of the gas or any other person, shall continue to be governed by the appropriate provisions of the Act and TDS shall be deductible on such payment to the third party at the applicable rates.

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Expert Committee Report on Amendments in Finance Act, 2012 to Income Tax

Report of the Expert Committee on Retrospective Amendments made by the Finance Act, 2012 to Income-Tax Act, 1961 Relating to Taxation of Non- Residents on Indirect Transfer; Comments and Suggestions on the Draft Report to be submitted by 19-10-2012

Press Release, dated 9-10-2012

Vide notification dated July 17, 2012, an Expert Committee was constituted on General Anti-Avoidance Rules (GAAR) to undertake stakeholder consultations and finalize the guidelines.

Subsequently vide notification dated September 1,2012 the Government modified the Terms of Reference of the Committee to include an additional item "to examine the applicability of the amendment on taxation of non-resident transfer of assets where the underlying asset is in India, in the context of all non-resident taxpayers".

The Committee has submitted its draft report on indirect transfer, which reflects consultations and written representations from a number of stakeholders including tax advisory firms comprising accountants and lawyers, chambers of commerce and industry, foreign investor associations and individual industry representatives.

The views expressed in Report of the Committee are that of an independent Committee and it should not be construed in any manner whatsoever as the views of the Government.

The report of the Committee has been uploaded on the Finance Ministry website (www.finmin.nic.in) and Income-tax Department website (www.incometaxindia.gov.in) for comments from stakeholders and the general public.

The comments and suggestions on the draft report may be submitted by 19th October, 2012 at the email address (jstpl2@nic.in) or by post at the following address with "comments on Expert Committee Report on Retrospective Amendments" written on the envelope.

Joint Secretary (Tax Policy & Legislation-II)

Central Board of Direct Taxes,

Department of Revenue,

Room No.147-C, 1st Floor,

North Block, New Delhi-110 001

The views of the Government on the recommendations of the Expert Committee will be formed after receipt of their final Report.

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Calculate Taxable Income and Pay Advance Tax and TDS on or before 15th September.

Friends, before a month i.e. September is a due month pay Advance tax for non-corporate cases (Non-Company). This is 1st Installment due for non-corporate case (Non-company) with 30% of gross Income Tax. As well as 2nd installment for Corporate Case (Company) paid Advance Tax with 30% today.

What is Advance Tax?
Tax payers whose total income is likely to be chargeable to tax for the assessment year are required to pay tax in advance during the financial year (April 1 to March 31) on their estimated current income, which will be assessable to tax during the next following financial year called assessment year. The current income for this purpose means the total income which will be chargeable to tax in the relevant assessment year.

The advance tax payable is the tax on the current income minus the tax deductible at source or collectible out of any income included in the current income.

What are the Due Dates and How to Calculate Advance Tax ?
The following chart helps you to knowing the due dates to pay Advance Tax and its Calculation.

Example:
If the Tax payee pays Gross Total Tax in whole year for A.Y. 2013-14 i.e. Rs. 100000.00 then;

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ADVANCE TAX CHART	Gross Income Tax	Rs. 100000.00
For Non Corporate Cases (Non-Company)	Rates	Amount of Tax (Rs.)
15th Sep	30%	30000
15th Dec	30%	30000
15th Mar	40%	40000
For Corporate Cases (Company)	Rates	Amount of Tax (Rs.)
15th June	15%	15000
15th Sep	30%	30000
15th Dec	30%	30000
15th Mar	25%	25000

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Get a view of your Income Tax Demand for Taxpayee who paid short amount of Income Tax.

As a Taxpayer friendly initiative, a facility to view details of Arrears Demand of taxpayers as communicated by their Jurisdictional Assessing Officers (A.O.) to the Central Processing Center (CPC) is now enabled on the e-filing website i.e. https://incometaxindiaefiling.gov.in/portal/index.do. Taxpayers can now log in to ‘My Account’ window and view their Arrears Demand.

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Pay Advance Tax on or before 15th September and avoid Interest Penalty.

Assessee who are in business and whose Business Income comes over taxable limit having tax-liability exceed Rs. 10000/- such assessee is liable for Advance Tax. The 2nd Installment of Advance Tax is due on or before 15th September of each Year. I request to such all Tax-payee (Individual Assessee who carrying a business) to pay their 1st Investment of Advance Tax and safe from Penalty Dues or Interest Amount. The 1st Installment of Advance Tax is 30% of Tax liability amount on the estimated Income from Business for the Financial Year 2012-13.

Difference Between Income Tax and Advance Tax.

Income Tax?
Income Tax is calculated on Actual income.
Income Tax is deposited in Assessment Year.
Income Tax is deposited as final tax.

Advance Tax?
Advance Tax is calculated on estimated income.
Advance Tax is deposited in Financial Year.
Advance Tax is deposited in installments in percentage.

Know more about Advance Tax Click Here.
Calculate your Advance Tax Click Here.
Submit your Advance Tax Challan Click Here

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Excel (Software) Utility to File Central Excise and Service Tax Return ER-1 to ER-6 & ER-8.

Excel (Software) Utility to File Central Excise and Service Tax Return ER-1 to ER-6 & ER-8.

Excel Utilities	Last Updated
Download ER1 Return Excel Utility	06/04/2012
Download ER2 Return Excel Utility	06/04/2012
Download ER3 Return Excel Utility	06/04/2012
(For Filing ER-3 returns for the Quarter Oct-Dec.2011 Onwards)
Download ER4 Return Excel Utility	06/04/2012
Download ER5 Return Excel Utility	06/04/2012
Download ER6 Return Excel Utility	06/04/2012
Download ER7 Return Excel Utility	06/04/2012
Download ER8 Return Excel Utility	06/04/2012
Download Dealer Return Excel Utility	06/04/2012
Download ER3 Return Excel Utility	06/04/2012
(For Filing ER-3 returns for the Quarter upto July-Sep.2011)

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