15G Exempts TDS on Taxable Income below a threshold limit!

15G Exempts TDS on Taxable Income below a threshold limit!

Form 15G can be filed with the prescribed financial institution if the individual’s total income is less than the basic exemption amount.

Where interest income from time deposits with prescribed financial institutions for a financial year (FY) exceeds the required maximum (currently 40,000), TDS at the applicable rate is deducted, according to the rules of the Income Tax Act.

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When an individual’s total income is less than the basic exemption limit, he or she can file Form 15G with a prescribed financial institution (such as a bank) to request that no taxes be withheld from the interest income made on the deposits.

Furthermore, if the tax rate at which the total income is subject to tax is NIL or lower than the rate at which the TDS is deducted (regardless of any advance tax paid by the recipient of income), the recipient of income may apply to the jurisdictional tax officer in the prescribed form for a lower or NIL deduction certificate (LDC). Following an examination of the appropriate papers, the tax officer may issue an LDC indicating a lower rate of TDS deduction at his or her discretion. TDS will be deducted at the rate provided in the LDC in this circumstance.

7 ways in which taxpayers can reduce their tax liability

Separately, take notice of the following from the perspective of the timing of taxation of such income. The interest income you receive from recurring deposits is taxed under the heading “income from other sources” (IFOS) according to the accounting system you use on a regular basis (i.e. mercantile/cash basis).

As a result, if you have previously offered interest income or revenue from other sources on an accrual/receipt basis, you might use the same approach for income from these RDs. The interest income will be taxed at the slab rates that apply to you for the fiscal year in which it is received. Any TDS already deducted by the bank on these deposits during the relevant FY will be credited against the income tax you owe for that year. If the amount of taxes deducted at source is less than the appropriate tax rate, you must pay the difference in advance tax in the specified instalments.

Latest Updates

Latest Business Update

1. Income tax department makes it mandatory to link your PAN with Aadhaar by 30th June 2021. If not linked, the PAN will become invalid. This will attract a higher TDS rate and may impact your financial transaction. Link your PAN with Aadhaar.

2. Apart from the above, by virtue of Section 139AA(2) of the Act linking of Aadhar with PAN within the prescribed timelines is mandatory. In case of non-linking the existing PAN issued shall be considered as inoperative and TDS shall be deducted at the higher rate as applicable in case of a person who does not have PAN i.e. @ 20%.

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3. The Finance Minister on 1 February 2021 has introduced a new Section 206AB vide Finance Act 2021. This Section is applicable for FY 2021-22 w.e.f. 1 July 2021. This amendment has been introduced to ensure filing of return of income by those persons who are required to file the return of income but are willfully not filing return of income.

What is the date of Effective Voluntary Cancellation of Registration under the IT ACT? 

4. Sebi came out with fresh guidelines on reporting formats for mutual funds. The formats for the reports to be submitted by asset management companies (AMCs) to trustees, by AMCs to Sebi and by trustees to the regulator have been revised on the basis of consultation from the industry.

5. Mandatory Registrations for NGOs after 01.04.2021 – Form CSR-1, Section 80G and Section 12AB of Income Tax Act. As per the notification issued by the Ministry of Corporate Affairs dated 22nd January 2021, it is mandatory for all NGO’s which wants to raise CSR Funding to enrol with MCA w.e.f 01/04/2021 to get CSR funding. And Filing of Form CSR-1 has been started on the MCA portal and a huge number of NGOs has already enrolled with MCA.

Big relief for Income Taxpayers- FY 2018-19!

On 30 September, the Central Board of Direct Taxes (CBDT) extended the deadline for late filing and updated ITRs for the assessment year 2019-20 from 30 September 2020 to 30 November 2020 due to difficulties faced by citizens following the COVID-19 pandemic.

On further account of the actual challenges encountered by taxpayers as a result of the Covid-19 crisis, CBDT further extends the deadline for the furnishing of belated and revised ITRs for the assessment Year 2019-20 from 30 September 2020 to 30 November 2020.Order u / s 119(2a) issued

On 29 July, the CBDT extended the date from 31 July 2020 to 30 September 2020 for the filing of income tax returns for fiscal 2018-19 and revised ITRs.

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