India faces first fall in direct taxes

India’s corporate and income tax revenue is likely to fall for the first time in at least two decades, more than half a dozen senior tax officials told Reuters, amid rapid declines in economic growth and lower corporate taxes rate.

The government of Prime Minister Narendra Modi targeted for a direct tax collection of 13.5 trillion rupees ($189 billion) for the year ending March 31-a 17 percent rise over the previous fiscal year.

A sharp decline in demand, however, has forced companies to slash investment and jobs, dent tax collections, and prompted the government to forecast 5 percent growth for this fiscal year – the slowest in 11 years.

A senior tax officer said that the tax department was able to collect only 7.3 trillion rupees as at January 23, more than 5.5% below last year’s level.

In the final three months, authorities usually raise about 30 to 35% of annual Direct Taxes from businesses during advance for the first three quarters, according to estimates from the last three years.

Yet eight senior tax officials interviewed by Reuters said this fiscal year was likely to fall below the 11.5 trillion collected in 2018-19, despite their best efforts to steer tax collections.

“Forget about the target. That’s the first time we’re ever going to see the drop in direct tax collections,” a tax officer in New Delhi said.

He predicts that direct tax receipts will end up around 10 percent below fiscal 2019 for this year.

The government’s annual revenue projections usually account for around 80% of direct taxes, and the deficit will leave the government with the need to raise borrowing to meet its expenditure commitments.
Tax officials also say that another major reason behind the lenient tax collections is a surprise reduction in the top corporate income tax rate last year aimed at wooling the fabricators and raising investment in Asia’s third-largest economy.

“We will be very pleased if we can even breakeven with what we raised last year,” said another senior tax official in the financial capital Mumbai, the largest tax driver, which accounts for about a third of direct tax revenues.

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E-Verification of ITR – Electronic Verification Code Generation

Welcome. In this post, we will see the procedure of e-confirmation of ITR or Income Tax Returns i.e., how to check your e-documenting without sending the ITR-V to Income Tax Department.

What is e-verification of ITR?

By and large, ITR check was finished by downloading the ITR-V, marking and sending in to the CPC. In any case, in an exertion towards paperless e-documenting, the Govt has thought of these new e-check forms.

When you effectively entire e-recording at Income Tax Department account, you can confirm your ITR utilizing on the web in 6 diverse ways.

Distinctive methods for e-confirmation of ITR include:

  • Versatile Number and Email Id
  • Aadhar Card
  • Netbanking Login
  • ATM Card (Specified Banks)
  • Financial balance subtleties
  • Demat Account

Utilizing any of these procedures, you can produce an Electronic Verification Code (EVC).

What is EVC or Electronic Verification Code?

The EVC is a 10-digit alphanumeric number which you can use to e-check your Income Tax Return. EVC extraordinary for each PAN and is legitimate for just 72 hours from the season of age.

Vital focuses to note about the electronic check code are:

  • The motivation behind EVC is to check the personality of the individual documenting the salary government form.
  • You can utilize EVC for confirmation of ITR-1, ITR-2, ITR-3, ITR-4.
  • In the event that you are e-checking through your portable number and email ID, qualification criteria are:
    i. your aggregate salary is under 5 lakhs
    ii. you have no discount ask
  • EVC is special to the PAN of the individual outfitting the ITR. This implies one EVC per PAN.
  • Proceeding with the above point, you can utilize one EVC to approve just a single ITR whether it is unique or amended return.

System for e-confirmation of ITR

Step-1: Login to Income Tax Department e-recording Account

Step-2: Select “e-recorded Returns/Forms” from “My Account” drop-down

Step-3: Click on “Snap here to see your profits pending for e-check”

Step-4: For whichever ITR you need to check, tap on “e-confirm”

Step-5: Choose any one choice recorded on the showed screen.

1. E-confirmation of ITR through Mobile number and email ID

  • Enter your portable number and email ID
  • EVC will be sent to your enlisted Mobile Number and Email Id
  • Enter the EVC and Submit

It would be ideal if you take note of: This check is material just if your Income is underneath Rs. 5 Lakh and you don’t have any discount in your arrival.

2. E-verification of ITR through Aadhar OTP

You can create an EVC utilizing Aadhar subtleties. You can utilize this EVC for e-check. Yet, for this, you probably connected your Aadhar number with e-documenting account. In the event that you have not connected Aadhar, you can interface the equivalent under profile settings in e-Filing account. On connecting Aadhar to e-recording account, an EVC will be sent to the Aadhar enrolled portable number. You can utilize this for e-check.

3. E-Verification of ITR through E-banking login

Login to the financial balance from the e-documenting entryway. Present any of the things appeared and e-check will be consequently entire.

Note: For e-confirmation with netbanking login, PAN must be connected with the ledger and PAN must be enlisted in the e-recording entryway.

4. E-confirmation of ITR through ATM

You can likewise create an EVC through ATM. You can utilize “Stick FOR INCOME TAX FILING” in the ATM to create the EVC. For this, you more likely than not connected your PAN with the particular financial balance and the PAN ought to be enrolled with e-Filing. After utilizing the alternative, you will get the EVC on the enrolled versatile number (Primary portable number enlisted with explicit Bank). As of now, this alternative is accessible for explicit banks as it were.

The banks are:

  1. Pivot Bank Ltd
  2. Canara Bank
  3. National Bank of India
  4. ICICI Bank
  5. IDBI Bank
  6. SBI

5. E-check of ITR through a pre-approved ledger

You can produce an EVC utilizing Pre-approved ledger subtleties. You more likely than not connected your ledger with e-Filing account. Alternative to interface the equivalent is accessible under Profile Settings – > Pre-approve financial balance after login to e-Filing entrance. Right now, this alternative is accessible for explicit banks as it were.

The banks are:

  1. Andhra Bank
  2. Bank of Baroda
  3. Canara Bank
  4. Central Bank of India
  5. HDFC Bank
  6. ICICI Bank
  7. IDBI Bank
  8. Karur Vysya Bank
  9. Kotak Mahindra Bank
  10. Oriental Bank of Commerce
  11. Punjab National Bank
  12. SARASWAT Bank
  13. State Bank of India
  14. Syndicate Bank
  15. Union Bank of India
  16. United Bank of India

6. E-confirmation of ITR through pre-approved DEMAT account

You can create an EVC utilizing Pre-approved DEMAT account subtleties. You more likely than not connected your DEMAT account with e-Filing account. Choice to interface the equivalent is accessible under Profile Settings – > Prevalidate DEMAT account after login to e-recording gateway. [Note: National Securities Depository Limited (NSDL) and Central Depository Services (India) Ltd (CDSL) gave the choice to pre-approve the DEMAT account].

What is the due date for e-verification of ITR?

The due date for e-confirmation of ITR is 120 days from the date of documenting of your profits. e.g. In the event that you record your arrival on first May, the due date will 29th August.

In the event that you are confirming following 120 days of documenting the arrival, you need to physically send ITR-V shape to CPC Bangalore.

What to do after e-verification of ITR?

Nothing. When the e-check is finished , you will get an affirmation to your enrolled mail ID and that is it.

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4 Tax sparing decisions for higher income and better future wealth

Financial planning is crucial for tax savings. Planning your finances would not only help you understand your income tax liability, but also check your expenses and maximize your returns on investment. In this way, you could invest in a variety of tax saving instruments and ensure that your investments maintain a steady return even in the wake of constantly fluctuating financial markets.

Overall, if you want higher incomes and better wealth in the future, plan your finances as soon as possible. To help, here’s our selection of the top four tax saving decisions you have to make.

1. Invest in a Unit Linked Insurance Plans (ULIPs):

In a single investment plan, ULIPs offer twin benefits of insurance and investment. Depending on your risk profile, age, income and financial goals, you can allocate the invested amount to a variety of equity and debt funds with ULIPs. In addition, you can also use life insurance cover during the policy period. One of the most important features of ULIP plans is that you can track your investments regularly by evaluating your funds ‘ net asset value (NAV). Your beneficiary would also receive the higher of the two values: the amount guaranteed or the fund value accumulated in the event of any eventuality. When we talk about the tax saving aspect of ULIPs, the premium paid is eligible for tax deductions in accordance with Article 80C, subject to a maximum of Rs 1.5 lakhs per year. In addition, the maturity benefits received by your beneficiary are exempted under the provisions of Section 10(10D). This makes ULIP one of the best tax saving tools that can help you to create a substantial corpus in the future and protect your family from unprecedented life situations.

2. Maximise Your Investments through Equity Linked Saving Schemes (ELSS):

ELSS, a type of mutual fund, was explicitly created to save taxes. Since ELSS investment is allocated only to equity funds, it is a slightly risky option but also gives higher returns (* returns are subject to market conditions). In addition, the premium invested in ELSS can be deducted from taxes up to Rs. 1.5 lakh, pursuant to Section 80C, while any long – term gains you gain at the time of exit will not incur any Long – Term Capital Gains Tax (LTCG) in accordance with current tax legislation. Another characteristic of ELSS funds is that you can invest in them by means of a systemic investment plan or SIP tax-saving. It is also important to note that ELSS investments made via the SIP route help you to minimize the risks associated with inflation – adjusted returns through compounding and rupee costs.

3. Save for Your Retirement:

It’s important that you save money for your retirement while you are still working. It is therefore recommended that you invest a portion of your income in a pension fund (also known as pension funds). You can thus not only plan a peaceful retirement life, but also benefit from tax benefits on the investment you make. Most pension funds from renowned insurers like Future Generali are hybrid in nature and you have the option of receiving a regular pension through the systematic redemption of the units. When we talk about the tax benefits provided by pension funds, the invested amount qualifies for a tax deduction up to Rs. 1.5 lakh according to section 80c.

4. Purchase a National Savings Certificate (NSC):

This scheme, introduced by the Indian Government as a low – risk investment scheme that could reach the majority of the population, is only available with the India Post. These certificates can therefore be obtained at the nearest post office, made on your behalf or in cooperation with another adult family member. You can also make the NSC in the name of a minor by a guardian only. The National Savings Certificate currently offers an annual compounded interest rate of 8 percent. That said, the interest rate is reset every three months, according to the G-Sec yields of the previous quarter. In addition, the interest earned each year is reinvested in the scheme until the date of early withdrawal or maturity. Investment in the NSC is eligible for deductions up to Rs in respect of tax savings. 1.5 lakh according to section 80c. Financial planning is essential in India if you want a high income now and maximize your wealth in the future. Not only must you create multiple sources of income early in your life, but you must also know how to save your income tax. Only then can you ensure that your investments maintain a healthy percentage of long – term returns, while you have the minimum possible tax liability.

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