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News Direct Tax-Income Tax

  • Dec 11, 2018
  • Direct tax receipts rise 15.7% in April-November

    The income tax department has collected Rs. 6.75 trillion in direct taxes this year up to November, accounting for close to half of its full-year target of Rs 11.5 trillion, an official statement said here. The April-November gross direct tax receipts show a 15.7% jump in revenue compared to the same time a year ago. During the first eight months of this fiscal, the department issued Rs.1.23 trillion of refunds, which is 20.8% more than the amount refunded during the same period a year ago. Net direct tax collections after refunds stood at Rs 5.51 trillion, a 14.7% jump from the year-ago period.

  • Dec 06, 2018
  • ITR forms will soon be pre-filled for you: CBDT’s Sushil Chandra

    The process of filing tax returns will soon become a lot easier, with the tax department planning to introduce pre-filled fields based on information already available with it, cutting out the tediousness of this annual chore.Data available from entities that deduct tax at source such as employers and banks would be used to offer pre-filled tax return forms to people, Sushil Chandra, chairman of Central Board of Direct Taxes (CBDT), said, adding that work on this project was on. A pre-filled return could be submitted directly or after modification, he said.The new form is aimed at encouraging people, who are daunted by the complexity of the process, to file their taxes. It’s also part of the department’s efforts to present a taxpayer-friendly interface and give officials fewer discretionary powers.

  • Dec 06, 2018
  • Taxman starts questioning & issuing notices to BPOs

    One month after the Authority of Advance Ruling (AAR) ruled that back office support services qualify as “intermediary” support services and not exports, officers of the indirect tax department have started issuing preliminary notices to captive units of multinationals and Indian companies exporting offshore support services.AAR’s directive meant several back offices of multinationals and Indian companies providing offshore support services to foreign companies now face 18% GST liability. The AAR held that some services provided by BPO may qualify as intermediary service and therefore, may not qualify as export service.

  • Dec 04, 2018
  • ITR filing up 50% so far this year: CBDT chairman

    Income tax return filing for assessment year 2018-19 has so far seen a 50 per cent rise since last year, a top finance ministry official said Tuesday. "This is the effect of demonetisation," Central Board of Direct Taxes (CBDT) Chairman Sushil Chandra said on the sidelines a CII event. Demonetisation has been very good for increasing the tax base of the country. This year, we have already got around 6.08 crore income tax returns, which is 50 per cent higher than last year by this particular date, he said.

  • Dec 03, 2018
  • Converting company to LLP is a transfer, hence taxable, rules I-T Appellate Tribunal

    A new tax ruling threatens to challenge a strategy that allowed thousands of businesses and professionals to reorganise themselves and attract foreign investors. This involved converting closely held companies into limited liability partnerships (LLPs) — a structure that was introduced a decade ago. While LLP was intended to help businesses to scale up, many were also allured by its ability to freely distribute profits to partners as dividend without deducting any dividend distribution tax.

  • Nov 29, 2018
  • NRIs don’t need to reveal details of foreign bank accounts, assets to Indian tax dept: I-T Tribunal

    The Income-Tax Appellate Tribunal (ITAT) has said NRIs do not need to reveal details of their foreign bank accounts and assets to Indian authorities. The tribunal has also ruled that the onus is on the I-T Department to prove an assessee has parked undeclared income arising from India in foreign bank accounts. The recent judgment was passed in the case involving Japan-based NRI Hemant Mansukhlal Pandya, who has an account with HSBC Bank in Geneva. Pandya has been living in Japan since 1990, is a non-resident taxpayer since 1995-96, and received a Japanese residency certificate in 2001.

  • Nov 24, 2018
  • ITAT ruling on premium earned on preference shares may benefit start-ups

    In what could benefit many start-ups in the country, the Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that premium earned on allotment of preference shares by a loss-making entity cannot be taxed. The tribunal said the valuation of shares is not relevant for determining the genuineness of the transaction. The ruling, pertaining to Section 68 of the Income Tax Act, stated that the assessing officer (AO) can only verify the nature and source and not question the genuineness of the premium on allotment of preference shares.

  • Nov 17, 2018
  • National capital jumps closer to business capital in I-T collections

    The changing economic landscape of India is showing up in the region-wise break-up of income tax collections. Mumbai, the business capital of the country, still contributes the largest, 29%, of total income tax revenues, but its share has been falling. Delhi, the second-largest contributor to the tax kitty, saw collections rising 45% from April to November 13 this year over the same period in 2017. Collections in Mumbai rose only 5%. Slower growth in Mumbai is attributed to hefty refunds.

  • Nov 05, 2018
  • 75 Lakh New Tax Filers Added To Income Tax Net This Fiscal Year: Official

    About 75 lakh new tax filers have been added to the income tax payers list in the country so far this fiscal year, a senior official said. The number of policy and enforcement measures undertaken to check tax evasion are among the reasons for achieving these numbers, the official told PTI. The target is to add 1.25 crore fresh tax filers by the end of the financial year 2018-19 that ends in March, as per a directive of the Central Board of Direct Taxes. The Income Tax department is hopeful of meeting that 1.25 crore target, the official added.The department, last fiscal, had added 1.06 crore new tax filers to the income tax net. A new income tax filer is defined as a person who is not included in the tax filing base at the beginning of the year, but who files the return during the year.

  • Oct 27, 2018
  • Income tax dept may seek first right on recovery of dues under IBC

    The income tax (I-T) department may soon request authorities in the finance ministry to intervene so that I-T dues get a higher priority over dues to unsecured creditors under the insolvency law. At present, the recovery of tax dues is possible only after payment to financial creditors under the Insolvency and Bankruptcy Code (IBC), which comes under the Ministry of Corporate Affairs.

  • Oct 27, 2018
  • Robust growth: E-filing of income tax returns rises 65% in Apr-Sept

    Even after the deadline for filing income tax returns ended on August 31, the growth in taxpayers filing e-returns continued to grow robustly, and for April-September, a 65% growth was witnessed over the year-ago period, data from the Central Board of Direct Taxes (CBDT) showed. The growth in the April-August period was 70%. Moreover, the average tax paid by an individual filer came in at close to Rs 35,000 in H1, up from a little over Rs 27,000 in April-August. Industry experts said that the rise in the average tax paid was attributable to the second tranche of advance tax — 45% of the assessed advance tax was to be paid by September 15 — paid by larger assessees.

  • Oct 24, 2018
  • Filing of income-tax returns slowed in demonetisation year, show CBDT data

    The number of income tax (I-T) returns filed grew 13 per cent for assessment year 2016-17, while it grew by less than 1 per cent in the assessment year (AY) 2017-18, the direct taxes data released by the Central Board of Direct Taxes (CBDT) shows. Returns for incomes earned in FY 2015-16 were filed in AY 2016-17. In other words, the assessment for incomes in a particular year is done in the year after. Similarly, returns for incomes earned in 2016-17, the demonetisation year, were filed in AY 2017-18.

  • Oct 23, 2018
  • CBDT Data FY14-17: Crorepati taxpayers rise by nearly 70%, returns filed rise by 80%, gross income up by 67%

    Earnings (gross income) reported by Indian taxpayers rose 67% to Rs 44.9 lakh crore between FY14 and FY17 (much higher than the nominal GDP growth of 36% during the period), the government said on Monday, seeking to prove that demonetisation and other steps taken by it to curb black money has not only yielded an expanded tax base, but more honest reporting of income.“The total number of taxpayers (including corporates, firms, HUFs, etc) showing (gross) income of above Rs 1 crore has also registered a sharp increase over the three-year horizon.

  • Oct 23, 2018
  • I-T dept launches major drive against Indians with illegal foreign assets; thousands under scanner

    The Income Tax Department has launched a major operation to investigate cases of illegal funds and properties stashed abroad by Indians looking to invoke the new anti-black money law for strict criminal action in many such cases.The department, in coordination with its foreign counterparts, is investigating offshore bank deposits and purchase of assets by “thousands of Indians”, officials said on Monday. The Central Board of Direct Taxes Chairman Sushil Chandra confirmed the move but refused to elaborate.

  • Oct 22, 2018
  • Number of Taxpayers goes up by 70%, collections down by 34% in April-August period – interesting details here

    E-returns filed by individual taxpayers grew 70% annually to 5.4 crore in the April-August period of the current financial year, but the average tax paid by them has come down by 32% to Rs 27,083. In the previous two years (FY18 and FY17), while the growth rate for e-filers for the respective April-August periods were 24% and 39% respectively, the average tax paid had declined marginally from about Rs 44,000 to nearly Rs 40,200 (see chart).Even though first, demonetisation, and later, the goods and services tax (GST) helped add pace to tax base expansion, the rate of growth in personal income tax (PIT) collection hasn’t risen commensurately.

  • Oct 18, 2018
  • Signing of pact by AMC sufficient to indicate start of biz, claim expenses

    The Income Tax Appellate Tribunal (ITAT) Mumbai has held that signing the investment management agreement by an asset management company (AMC) is enough to claim deduction for revenue expenses even if the scheme is yet to commence.“What is relevant under the Income Tax Act, 1961, is the setting up of the business and not the commencement of business. Accordingly, it is ‘setting up’ of the business and not the ‘commencement’ of business that is to be considered.“A business is commenced as soon as an essential activity of the business is started,” said an ITAT Bench of RC Sharma and Amarjit Singh. The case pertains to Pinebridge India (earlier known as AIG Global Asset Management) and the Income Tax Department for the assessment year 2007-08.

  • Oct 11, 2018
  • ITAT gives partial reprieve to Uber in tax demand case

    In a partial reprieve for Uber India, the Income Tax Appellate Tribunal (ITAT) has granted a stay against a tax demand levied on the cab-hailing company and restrained the authorities from imposing any penalty. Uber had approached the tribunal after income-tax authorities carried out a survey and alleged that the company had not deducted tax at source on payments made to driver-partners. The tribunal partially stayed the demand, subject to Uber India depositing Rs 20 crore in three instalments pending disposal of the appeal. The main issue of applicability of tax deduction at source on payments will now be heard on December 11.

  • Oct 09, 2018
  • CBDT extends deadline for filing ITRs with audit reports to Oct 31, 2018

    The government today extended the deadline by a fortnight till October 31 for filing Income Tax return (ITR) and audit report for financial year 2017-18 (AY 2018-19).This is the second extension within a fortnight of the Central Board of Direct Taxes (CBDT), earlier extending the deadline for tax payers whose accounts have to be audited from September 30 to October 15.Tax audit is a review of accounts of taxpayers with business or profession from an income tax point of view such as incomes, deduction, compliance with tax laws, etc. Taxpayers with turnover exceeding Rs 1 crore in business (not opted for presumptive taxation scheme) or whose gross professional income is over Rs 50 lakh need to get a tax audit done. Tax audit report needs to be filed on or before the 30 September of the subsequent financial year in case of taxpayers.

  • Oct 05, 2018
  • Govt notifies 10% LTCG tax on IPO/FPO gains

    The Income Tax Department has notified norms for applicability of concessional long-term capital gain tax. This will benefit investments made in initial public offerings (IPOs) and follow-on public offerings (FPOs). The new norms will come into effect from April 1, 2019, and will apply in relation to assessment year 2019-20 and subsequent assessment years. The notification talks about two types of transactions: First, those entered into before October 1, 2004, and second, those entered into on or after October 1, 2004, and not chargeable to securities transaction tax (STT).