Form 16 has been postponed to July 15, although the deadline for self-assessment tax over Rs 1 lakh is still July 31.

Form 16 has been postponed to July 15, although the deadline for self-assessment tax over Rs 1 lakh is still July 31.

The government has delayed numerous income tax deadlines as a result of the second wave of the coronavirus, including those for filing income tax returns for FY 2020-21, issuing Form 16, and others. However, for those whose tax liability after deduction of TDS and advance tax exceeds Rs 1 lakh, the deadline for filing self-assessment tax for FY20-21 has not been extended. If a self-assessment tax of more than Rs 1 lakh is not paid by July 31, such individuals may face a penalty.

RSM India’s Founder, Dr Suresh Surana, adds, “Additionally, an extension has been granted to employees for the issuance of TDS certificates in Form 16 following the extension of the due date for filing TDS returns. The issuance of TDS certificates in non-salary instances does not currently have a corresponding extension. As a result, by June 15, 2021, banks must submit Form 16A (TDS certificate for tax deducted on interest).”

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According to a government press release issued on May 20, 2021, if an individual taxpayer’s tax dues for FY 2020-21 exceed Rs 1 lakh after deducting TDS and advance tax dues, the payment must be made on or before July 31, 2021. From August 1, 2021, until the date of filing of the ITR, criminal interest will be charged at a rate of 1% per month under section 234A of the Income-tax Act, 1961.

This is comparable to the government’s action last year, which only benefited small and medium-sized taxpayers.

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Even though the ITR filing date for people whose accounts are not required to be audited has been extended to September 30, 2021, if an individual’s tax liability for FY 2020-21 exceeds Rs1 lakh, they must pay the amount before July 31, 2021 to avoid paying penal interest.

“It has been clarified that interest under section 234A of the Act shall continue to be levied where the tax payable (after TDS/TCS, advance tax, relief under section 89, 90/ 90A/ 91, MAT credit) is more than Rs. 1 lakh,” says New Delhi-based practising chartered accountant Sachin Vasudeva.

ITR or Income Tax Return Filing Deadline for FY21 (AY 2021-22) Extended.

Deloitte India Partner Saraswathi Kasturirangan believes “The extension of the deadline for filing tax returns is a good thing. However, when the self-assessment tax owed on the return is more than Rs 1 lakh, this does not afford relief from the interest that is charged for filing the return after the initial due date.”

How to calculate self-assessment tax?

To figure out how much self-assessment tax you owe for FY 2020-21, follow these steps:

  • Step 1: Determine your entire income for the fiscal year 2020-21. This comprises wages, capital gains, rental income, interest income, dividend income, and other sources of income.

  • Step 2: To calculate your net taxable income, subtract your total income from your tax exemptions and deductions. House rent allowance, tax-saving investments under section 80C (ELSS, PPF, etc.), premium paid on your health insurance policy, and so on are examples of tax exemptions and deductions.

  • Step 3: Determine the amount of tax you owe on your net taxable income. You may determine your income tax liability using ET Wealth’s online calculator.

  • Step 4: Subtract the amount of taxes paid as TDS from your salary, interest income, and other sources from your total tax liability. Deduct the advance tax (if any) that you paid in the fiscal year 2020-21. These facts will be reflected on your Form 26AS. The deadline for filing TDS/TCS returns has been extended by the government to July 31.

When you reduce the TDS and advance tax from your overall tax liability, you’ll get the amount of self-assessment tax you’ll have to pay before filing your ITR.

Are you aware of these Top 5 EPFO Provident Fund account benefits?

Employees’ Provident Fund Organisation (EPFO) offers a variety of benefits to its members. Free insurance and pension coverage are among the Provident Fund’s perks. In general, an employee’s Provident Fund (PF) account is viewed as a retirement-oriented investment option, and it is required of any employee who meets the Rs 15000 monthly PF contribution threshold. Section 80C of the Income Tax Act exempts an employee’s PF contribution up to Rs 1.5 lakh in a single financial year from income tax.

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Employees should be informed of the following five primary points:-

1. Free insurance:

Under the EDLI, a Provident Fund Account holder is automatically liable for free insurance up to Rs 7 lakh in the event of death while serving (Employees Deposit Linked Insurance Scheme). The death cover for PF account holders was previously Rs 6 lakh, but it has now been increased to Rs 7 lakh. Most notably, the PF account holder would not have to pay any insurance premiums for the EDLI death cover.

2. Pension provision:

After 58 years, a PF account holder is still liable for a pension. To be eligible for a pension, however, a minimum of 15 years of daily monthly PF contributions must be made in one’s PF account. The pension gain comes from the employer’s contribution, which goes to the EPS account of the PF account holder for 8.33 percent of its contribution (out of a total of 12 percent).

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3. Loan against PF:

In the event of a financial emergency, a PF account holder may borrow against his or her PF balance, with an interest rate of only 1%. The loan will be for a limited time and must be repaid within 36 months of the date of disbursement.

4.Emergency partial withdrawal:

EPFO provides for partial withdrawal in the event of a medical or financial emergency, subject to certain terms and conditions.

How to navigate tax changes to protect your long-term money goals

5. Home loan and hole loan repayment:

An individual’s PF account may be used to repay a home loan. According to EPFO law, they can withdraw up to 90% of their PF balance for the purchase or construction of a house. They can also use their PF balance to purchase properties.

Foreign Trade Policy 2015-2020 along with the procedures is extended for the year 2020-21

1. All the export incentives including MEIS, SEIS, EPCG and other benefits stand extended for the period 2020-21

2. The due date for filing SEIS application for FY 2018-19 is extended up to 31 December 2020

3. Eligible services for SEIS incentive for FY 2019-20 shall be notified

4. The decision on the continuation of SEIS incentive against the exports made from 2020-21 to be taken subsequently

5. Exemption of IGST on imports against Advance Authorization is further extended up to 31 March 2021

6. The validity of Duty-Free Import Authorization (DFIA) is extended by 6 months where the validity for import is expiring between 01 February 2020 and 31 July 2020

7. Exemption of IGST and Compensation cess on Capital goods imported under EPCG scheme is further extended up to 31 March 2021

8. The validity of EPCG authorization is extended by 6 months where the validity for import is expiring between 01 February 2020 and 31 July 2020

9. Against the exports made (LEO date) between 01 February 2019 and 31 May 2019, the application for MEIS incentive is to be filed within 15 months of the LEO date (earlier it was 12 months)

10. The validity of Advance Authorization expiring between 01 February 2020 and 31 July 2020, the validity shall be extended by 6 months from the date of expiry

11. Export Obligation period expiring between 01 February 2020 and 31 July 2020, the validity shall be extended by 6 months from the date of expiry

12. Certificate for installation of Capital Goods imported under the EPCG scheme is extended by 6 months from the original due date where the due date expires during 01 February 2020 and 31 July 2020

13. Extension of due date for discharge of Block Wise Export Obligation expiring during 01 February 2020 and 31 July 2020

14. Extension of LOP/LOI whose validity is expiring on or after 01 March 2020 shall be deemed to be valid up to 31 December 2020

15. Extension of due date for TED Refund/ Drawback – where the date of filing is falling on or after 01 March 2020, the date of filing application is extended upto 30 September 2020

16. Extension of due date for Transport and Marketing Assistance incentive – application for claim of incentive for quarter ending 31 March 2019 & 30 June 2020 may be filed before 30 September 2020

17. Late Cut – Last date of submission of application for the purpose of Late cut would be taken as 31 December 2020

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