Covid-19: Tax Relief measures for individual Taxpayers

The World Health Organization (WHO) has declared the Novel Coronavirus (COVID-19) a global pandemic, and its rapid spread causes major economic disruption. To control the spread of COVID 19, India, like many other countries, is in lockdown mode and this has impacted individual taxpayers

In order to Rescue taxpayers, the Government of India came up with by Providing various Relief Measures

Due dates are extended for the individuals

1. Belated / revised tax return filing

On or before 31 March 2020, a belated tax return and revised tax return for the financial year (FY) 2018-19 had to be filed. This due date is now has been extended to June 30th, 2020.

tax due dates

2. Tax saving investments/ payments / donation

Specified investment/payments (such as investments in the Public Provident Fund, life insurance payments, etc.) or donations to use income deductions for the 2019-20 financial years had to be made until March 31, 2020. yeyeNow these investments/payments may be made up to 30 June 2020 to avail income deductions for the Financial year  2019-20.

Similarly, exemptions from Long Term Capital Gains are available if such investments are made within the specified period from the day the capital asset is transferred. Now any such investment which is due from 20 March 2020 to 29 June 2020 can be made up to 30 June 2020, subject to certain conditions specified in the 1961 Income Tax Act (‘the Act’).

adhaar pan linking

3. Aadhaar-PAN linking

By 31 March 2020 Aadhaar was to be linked to PAN. Else, this would have been inoperative for PAN. The due date for linking Aadhaar and PAN has now been extended until 30 June 2020.

4. Reduction of rate of interest on delayed payment of tax:

 Any tax that  is due to be paid in between 20 March and 29 June under the act,  such taxes can be paid by 30th June 2020, then the interest on late payment of such taxes will be imposed at 0.75% per month (or part of the month) instead of 1% per month (or part of the month)

Few examples of tax payments through which people may make use of this advantage are:

  • Taxes Deducted at source (TDS), that are due from 20 March to 29 June;
  • First installment of advance tax due for FY 2020-21 by 15 June 2020;

5. Lower / Nil withholding certificates:

An individual is required to obtain a tax withholding tax certificate on a certain income at a lower or NIL rate from the tax authorities. The certificate must be obtained by applying to the tax department at the beginning of each financial year.

In view of the current situation, the certificates held for FY 2019-20 shall be valid till 30th June 2020 until the new certificate for FY 2020-21 has been granted by the tax department. If a taxpayer has not yet filed an application for FY 2020-21, he is expected to file the same application at the earliest possible date with the help of the modified online process and by e-mail to the concerned assessing officer.

The tax officers are ordered to dispose by 27 April 2020 of all the pending application of lower deduction  for FY 2019-20. The applicant is required to inform the concerned tax officer about the pendency of the application to vide e-mail and the concerned officer shall communicate the vide e-mail to the person on acceptance / rejection.

The valid Form 15 G and Form 15H submitted for lower or nil interest / income deduction to banks or financial institutions for FY 2019-20 will remain valid until 30 June 2020.

6. Withdrawal from Provident Fund (PF)

Withdrawal from PF is limited to employees while in service. However  Employees Provident Fund Organization (EPFO) has allowed employess to get a non-refundable advance from their existing PF balances while in service.  The advance amount shall be lower than the Standard and Dearness Allowances of 3 months, or 75 percent of the PF account balance. It is also explained that this amount being advace will not be taxable.

7. Issue of refund

In a press release on 8 April 2020, it was reported that all pending income-tax refunds up to Rs.5 lakh will be issued immediately to provide immediate relief to businesses and individuals.

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Search and Capture under Income Tax

Who can Authorize Search and Seizure

Head Chief Commissioner/Principal Director General/Principal Commissioner/Principal Director/Director General/Director/Chief Commissioner/Commissioner/Additional Commissioner/Additional Director/Joint Director/Joint Commissioner.

Who can be Given Authorized to conduct search and Seizure

• Additional Director

• Additional Commissioner

• Joint Director

• Joint Commissioner

• Assistant Director

• Deputy Director

• Assistant Commissioner

• Deputy Commissioner

• Income-tax Officer

Powers Given to Authorized Officer

• To enter and look for any building, place, vessel, vehicle or air ship where he has enough reason to check that books of account, different documents, cash, bullion, jewelry or other important article or thing are kept

• Break open the lock of any entryway, box, storage, safe, almirah or different containers for practicing the powers presented above where the keys thereof are not accessible

• Search any individual who has out of, or is going to get into, or is in, the building, place, vessel, vehicle or air ship, if the approved official has reason to speculate that such individual has secreted about his individual any such books of record, different docs, cash, bullion, jewelry or other important article or thing.

• Require any individual who is seen as under possession or control of any books of record or different docs kept up as electronic record to bear the cost of the authorized official the essential facility to investigate such books of record or different reports

• Seize any such books of record, different documents, cash, bullion, jewelry or other important article or thing found because of such search. (However, bullion, jewelry or other important article or thing, being stock-in-exchange of the business, found because of the search will not be seized yet the approved official will make a note or inventory of such stock-in-exchange of the business).

• Place signs of ID on any books of record or different docs or make or cause to be made extracts or duplicates in this manner

• Make a note or an inventory of any such cash, bullion, jewelry or other significant article or thing.

• Where it is beyond the realm of imagination or practicable to take physical ownership of any significant article or thing and evacuate it to a sheltered spot because of its volume, weight or other physical attributes or because of its being of a risky nature, to serve a request on the proprietor or the individual who is in quick possession or control thereof that he will not expel, part with or generally manage it aside from with the earlier authorization of the authorized official. [With impact from 1-6-2003 the above point will not have any significant bearing in the event of any important article or thing, being stock-in-exchange of business]

Privileges of the person searched

• To see the warrant of authorisation appropriately marked and fixed by the giving position

• To confirm the identity of every individual from the hunt party

• To make individual pursuit of all individuals from the hunt party before the beginning of the inquiry and on finish of the hunt

• To demand individual pursuit of women being taken distinctly by woman, with severe respect to respectability

• To have at any rate two good and autonomous occupants of the territory, as witnesses

• A woman occupying an apartment being looked has a right to pull back before the hunt gathering enters, if, as per custom, she doesn’t show up out in the public

• To call a medicinal expert if there should be an occurrence of emergency

• To enable the kids to go to school, subsequent to handling their bags

• To have the office of having dinners, and so forth., at the ordinary time

• To examine the seals set on different repositories, fixed in course of search and consequently at the hour of reviving of the seals

• Every individual who is analyzed under area 132(4) has an option to guarantee that the realities so expressed by him have been recorded effectively

• To have a duplicate of the panchnama together with all the annexures

• To have a duplicate of any explanation that is utilized against him by the Department

• To have investigation of the held onto books of record, and so on., or to take removes along these lines within the sight of any of the approved officials or some other individual enabled by him

• To make an application questioning the endorsement given by the CIT for maintenance of books and records past 180 days from the date of the seizure

Duties of the person Searched

• To permit free and unhindered entrance into the premises

• To see the warrant of authorisation and put signature on the equivalent

• To distinguish all containers wherein resources or books of record and archives are kept and to hand over keys to such repositories to the approved official

• To distinguish and clarify the responsibility for resources, books of record and archives found in the premises

• To recognize each person in the premises and to disclose their relationship to the individual being looked. He ought not delude by personation. In the event that he cheats by professing to be some other individual or intentionally substitutes one individual for another, it is an offense culpable under segment 416 of the IPC

• Not to permit or empower the section of any unapproved individual into the premises

• Not to expel any article from its place without the notice or information of the approved official. On the off chance that he privileged insights or decimates any archive with the aim of keeping the equivalent from being delivered or utilized as a proof under the watchful eye of the Court or local official, he will be culpable with detainment or fine or both, as per segment 204 of the IPC

• To answer all questions honestly and to the best of his know-edge, he ought not enable any outsider to either meddle or incite while his announcement is being recorded by the approved official. In doing as such, he should remember that—

(I) If he will not respond to an inquiry regarding a matter pertinent to the pursuit activity, he will be culpable with detainment or fine or both, under area 179 of the IPC

(ii) Being legitimately bound by a pledge or insistence to express reality in the event that he owns a bogus expression, he will be culpable with detainment or fine or both under area 181 of the IPC

(iii) Similarly on the off chance that he gives proof which is false and which he knows or accepts to be false he is obligated to be rebuffed under area 191 of the IPC

• To fasten his mark on the recorded articulation, inventories and the panchnama

• To guarantee that harmony is kept up all through the length of the inquiry, and to co-work with the hunt party in all regards so the pursuit activity is closed at the most punctual and in a serene way

• Similar co-activity ought to be broadened even after the pursuit activity is finished, to empower the approved official to finish fundamental follow-up examinations at the soonest.

Inability to Comply with Section 132(1)(IIB)

Thorough detainment for a term which may reach out to 2 years and will likewise be at risk to fine.

Inability to Comply with Section 153A

Culpable under area 276CC.

Enquire with Certicom Consulting for further information or in case of any queries.

 

Avoid Payment of Capital Gains Tax On Property Sales In India

In India, you pay a capital additions charge on the closeout of a capital resource and a property is a capital resource. Along these lines, on the off chance that you have acquired a property for Rs 10 lakhs in 2008 and sold it in 2014 for Rs 30 lakhs, you have to make good on capital increases regulatory expense on property on the benefit of Rs 20 lakhs. Obviously, you need to mull over indexation.

How this capital additions is determined and what is the capital increases charge rate, we will see later.

What is capital additions charge on property and sorts of capital increases?

In the event that you sell the property at a benefit in under three years, at that point momentary capital additions charge will be relevant. Then again on the off chance that you sell the property following three years, at that point a capital additions duty of 20 percent will apply after indexation.

The administration gives you the advantage of indexation, as a result of expansion. There is an indexation adding machine that you should utilize. For instance, while the property obtained in 1980 may have gone up, so has expansion. Thus, you need indexation to touch base at the definite estimation for paying capital additions.

How to save money on capital gain charge?

Presently, as demonstrated you need to either pay present moment or long haul capital increases charge. Be that as it may, you can abstain from settling capital additions government obligation by completing one of the accompanying:

a) Reinvesting deal continues in another property

You can reinvest the whole deals continues in another private property. It would be ideal if you note, it is private and not business property. This must be done inside a 2-year time span. So ensure that after you sell, you start your chase for another property right away.

b) Construction of another property

The deal continues can likewise be utilized to build another private property and the room one gets is three years and not two years. This again must be arch inside the stipulated time allotment, to enable you to save money on capital additions charge.

c) Sale continues to be put resources into capital additions bonds

You can likewise put the sum in capital additions bonds. These are issued by two government possessed substances including the National Highways Authority of India and the Rural Electrification Corporation. There is a top of Rs 50 lakhs that has been fixed and one can’t contribute more than this sum. The loan cost on these bonds isn’t without question and is around the six percent mark.

The securities have been profoundly appraised and accompanied AAA/Stable by CRISIL and IND AAA(Stable) by India Ratings and Research. Regardless the odds of a default on these bonds is insignificant given the way that they are government upheld establishments.

These securities are not paying any incredible financing cost. Truth be told, the loan cost is only 6 percent, which makes them very ugly. Enthusiasm on the equivalent can continue changing and you have to check the most recent financing cost.

Best alternative to save money on capital gains

We trust that interest in the capital increases attach to spare charges isn’t appealing. It is ideal to utilize the returns to purchase or develop another house. The National Highways Authority of India capital additions securities, gives you a financing cost of only 6 percent consistently.

The best activity would be first to figure and see, how much capital increases you are probably going to pay. In view of that you should take a choice. On the off chance that the measure of capital additions payable to the specialists is somewhat high, you could well go for another house.

Pay taxes legitimately

It is ideal to pay your capital additions charge, in the event that you have depleted every one of the way to save money on them as referenced previously. There are people who get into confused arrangements to abstain from settling regulatory obligation. This isn’t the best activity and it is ideal to remain in consistence with the laws and the present rules. Work nearby a Chartered Accountant or a duty master in the event that the arrangement is actually huge and the risk that is emerging if there should arise an occurrence of clearance of property is huge ticket one.

Strikingly, even value offers would now pull in a long haul capital additions, expediting it standard with property and gold. This is a decent move by the legislature of India to treat all ventures on par as far as capital additions. Regardless one should be think about everything after the clearance of property.

Enquire with us for any queries related to income tax filing in Bangalore.