20 February 2018
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  • IT raid cases not to be processed under e-assessment: CBDT
    Feb 14, 2018
    The soon-to-be rolled out pan India e-assessment system for scrutiny cases of taxpayers will not be applicable to instances where a raid has been conducted against an assessee by the Income Tax (IT) department, the CBDT has said. It has added that the current system of manual assessment will continue in cases, where the books of accounts or original documents have to be examined, the taxman has to conduct a third-party investigation and where the tax officer has to examine a witness.
  • Income Tax panel refuses to stay Rs 110 crore tax demand on Flipkart
    Feb 12, 2018
    An income tax panel refused to stay a demand of Rs 110 crore on Flipkart, India's largest online retailing platform, after it was asked to reclassify discounts and marketing spend as capital expenditure. This may have implications for rival Amazon, which faces a similar liability, and others. The Income Tax Appellate Tribunal (ITAT) in Bengaluru asked Flipkart to deposit Rs 55 crore and provide bank guarantees to the tune of Rs 55 crore by February 28. While the tax assessed is for 2015-16, similar demands may be made for subsequent years. Hearings will continue after February 28.
  • Deposited 'large amount of cash' during note ban? File ITR by March 31
    Feb 10, 2018
    The Income Tax Department on Friday urged those who deposited "large amounts of cash" post demonetisation and all companies to file their returns by March 31, failing which they may face penalty and prosecution. It also cautioned eligible trusts, political parties and associations to file their income tax returns by this final deadline and "come clean".The department, in public advertisements issued in leading dailies, said it was the final call for filing of belated or revised ITRs for assessment years 2016-17 and 2017 -18.
  • No LTCG tax if you sell shares or mutual fund units before 31 March 2018
    Feb 09, 2018
    The proposed long-term capital gains (LTCG) tax on equity (including shares and equity mutual funds) in the Union Budget 2018 came as a blow for investors. The Budget says that after 1 April 2018, the LTCG earned from investments in equity will be taxed at 10%. However, any LTCG earned till 31 January 2018 will be grandfathered, which would mean that LTCG earned before 31 January will not be taxed.This move may prompt some investors to rejig their portfolios. There is some good news for them. On 4 February 2018, the Central Board of Direct Taxes (CBDT) released a list of frequently asked questions (FAQs) about the proposed tax on LTCG.
  • No notice to taxpayers in case of minor filing mismatch: CBDT
    Feb 07, 2018
    From now on, the taxman will not issue demand notice to taxpayers in case there is a minor mismatch between their income tax return (ITR) and the corresponding tax credit data collected by the department from banks and other financial institutions. The measure, introduced in the latest Financial Bill, is aimed to provide relief to small and salaried class of taxpayers and aims to ease out issues of small discrepancies that sometimes crop up between the information on Form-16 (provided by the employer) and Form-26AS (tax credit statement received by the tax department).
  • I-T Department Sends Tax Notices To Cryptocurrency Investors: CBDT Chairman
    Feb 07, 2018
    The tax department is issuing notices to people who invested in crypto currencies like bitcoin but did not declare income or 'profits earned' from them, CBDT chairman Sushil Chandra said today. The department has found that there is no clarity on investments made by many people, which means they have not declared them properly, he said."People who have made investments (in crypto currency) and have not declared income while filing taxes and have not paid tax on the profit earned by investing, we are sending them notices as we feel that it is all taxable," he said on the sidelines of an event here.
  • Relief to foreign investors: MAT waiver now for firms with PE too
    Feb 06, 2018
    The Finance Act, 2016, had said minimum alternate tax (MAT) won’t apply to foreign institutional investors (FIIs) and foreign portfolio investors (FPIs) as they normally won’t have a place of business in India and given the decision retrospective effect from 2001. Budget 2018-19 has gone a step further: It clarified that foreign companies in specified infrastructure sectors, which operate in the country with permanent establishment (PE) — read branch offices — but are under Section 44BB, given the facility of paying tax on a presumptive income basis won’t have to dread MAT.
  • Income Tax department issues FAQs on LTCG tax
    Feb 05, 2018
    The income tax department has issued a set of frequently asked questions (FAQs) to clear doubts about the long-term capital gains tax levied on shares in the budget, clearly providing that the tax will be levied on shares sold after April 1, 2018."The new tax regime will be applicable to transfer made on or after 1st April, 2018, the transfer made between 1st February, 2018 and 31st March, 2018 will be eligible for exemption under clause (38) of section 10 of the Act," it said. There had been confusion that the regime will apply to shares sold on or after February 1, the day of the budget.This also means there could be pressure on stock prices as investors sell shares to take advantage of the earlier regime till March 31. By the same reasoning, the long-term capital loss arising from transfer made on or after April 1, 2018 will be allowed to be set-off and carried forward in accordance with existing provisions of the Act.
  • Good news for tax-paying senior citizens
    Feb 03, 2018
    The Union Budget has many proposals that would cheer up the senior citizens. And, one of the biggest reasons is the increase in deduction limit under section 80D of the income-tax Act—under which one can avail benefits for payment of health insurance premiums. The premiums that you pay towards a health insurance policy qualify for tax deduction. A deduction is the first tool to use to reduce your tax liability. It’s a reduction from your total income, and what is left after that is called your taxable income. The Union Budget 2018 has announced to increase this deduction for senior citizens from up to Rs30,000 to a maximum of Rs50,000.
  • Equity mutual funds to pay Dividend Distribution Tax of 10 per cent
    Feb 03, 2018
    Investors who bank on dividends from equity mutual funds to generate periodic income would be hit by the new budget proposal to tax dividends on equity mutual funds schemes. "I also propose to introduce a tax on distributed income by equity oriented mutual fund at the rate of 10 per cent. This will provide level playing field across growth oriented funds and dividend distributing funds," the finance minister said in his budget speech.
  • Sacked employees paid off a lump sum will now have to pay tax on compensation received
    Feb 03, 2018
    Sacked employees receiving compensation, business tycoons collecting fat no-compete fee, and trade partners who were paid off a lump sum after their contracts were scrapped often ended up having spats with the tax office over the taxability of such payments. Several disputes boiled over to tax tribunals and higher courts, where men and women who were compensated argued that the amount should not be taxed as they have lost their source of earnings. However, assessing officers found grounds to contest the claim.
  • Most companies to pay 25% corporate tax
    Feb 02, 2018
    Finance minister Arun Jaitley on Thursday cut corporate tax to 25% from 30% for companies with annual turnover up to Rs 250 crore. The lower rate will be applicable to 99% of the firms filing tax returns and is estimated to set the government revenue back by Rs 7,000 crore. The lower corporate tax is expected to leave businesses with investable surplus and create more jobs. With this, there are now 7,000 firms with a headline corporate tax rate of 30%, including the large capital-intensive firms that are able to reduce the actual tax outflow with assorted investment-linked deductions and exemptions.
  • India Inc terms Budget 'populist', disappointed on tax front
    Feb 02, 2018
    India Inc on Thursday welcomed the Union Budget 2018-19 -- the last full budget of Finance Minister Arun Jaitley before the 2019 general elections -- and praised the populist approach of focussing on infrastructure and rural India. However, what came as disappointment for the industry was that the government did not provide any relief in the income tax rates for 2018-19, along with the imposition of long-term capital gains (LTCG) tax on equities exceeding Rs 1 lakh at 10 per cent.
  • Standard Deduction of Rs 40,000 on income tax actually amounts to just Rs 10,000 benefit
    Feb 02, 2018
    Budget 2018 is over and the verdict is out. While Indians were expecting major relief by way of new tax slabs, lower tax rates and hiked up allowances, Finance Minister Arun Jaitley's focus on the gareeb nagrik and the agriculture sector has translated to disappointment on these fronts. In his ongoing Budget speech Jaitley said "We do not propose any changes in personal income tax structure."
  • Tax incentives for International Financial Services centre
    Feb 02, 2018
    In order to promote trade in stock exchanges located in International Financial Services Centre (IFSC), the Union Finance and Corporate Affairs Minister Arun Jaitley proposed to provide two more concessions for IFSC.Presenting the General Budget 2018-19 in Parliament Jaitley proposed to exempt transfer of derivatives and certain securities by non-residents from capital gains tax. Further, the Finance Minister added that non-corporate taxpayers operating in IFSC shall be charged Alternate Minimum Tax (AMT) at concessional rate of 9% at par with Minimum Alternate Tax (MAT) applicable for corporates.
  • What 10% LTCG tax on gains over Rs 100k means for investors
    Feb 02, 2018
    Budget 2018 has proposed to levy long-term capital gains tax (LTCG) of 10% on gains exceeding Rs 100,000 from sale of equity shares. However, capital gains made on shares until January 31, 2018, would be grandfathered, the finance minister said. Also, there has been no change in the definition of short-term capital gains tax (STCG).
  • Investors to pay 10% tax on distributed income from equity MFs
    Feb 02, 2018
    Investors will have to pay 10 per cent tax on distributed income from equity-oriented mutual funds, as per the Budget proposals announced on Thursday. While unveiling the Budget proposals for 2018-19, Finance Minister Arun Jaitley also proposed to introduce 10 per cent tax on long-term capital gains from stock markets, exceeding Rs 1 lakh. Experts opine that overall investor sentiment will take a hit with these measures, especially since mutual funds have recently emerged as a key route to invest in stock markets.
  • Income Tax Appellate Tribunal rules against Vodafone Services over tax row
    Jan 27, 2018
    A tax tribunal has settled the issue of deemed international transactions when the company concerned terminates its call option. The case relates to Vodafone India Services not exercising its call option to buy just over three per cent stake in group company Vodafone India. Nitin Narang, executive director at Nangia & Co, said Vodafone India Services, a back office company for the group, had the option to buy 3.18 per cent equity in Vodafone India for Rs 27.8 million, so long as the fair market value of these shares was less than Rs 15 billion. If the latter value rose higher, it was to pay slightly more.
  • Tax the only certainty for cryptocurrency players
    Jan 24, 2018
    In the midst of all the uncertainties around cryptocurrency, there is some clarity on at least one aspect. Investors, who have made a fortune selling the virtual currency, will need to pay 20 per cent advance tax on the earnings to avoid any action by the income tax (I-T) department. “Since there is no clarity over whether cryptocurrency is a good, capital asset or business income, the tax department is not trying to distinguish. They are just saying, pay 20 per cent advance tax on money earned,” said Sathvik Vishwanath, founder of cryptocurrency exchange Unocoin.
  • Tax Dept: Don’t donate over Rs2k in cash to parties
    Jan 24, 2018
    The Income Tax Department today cautioned people against indulging in illegal cash transactions, including donating more than Rs 2,000 to political parties. In a bid to clean up election funding, the government early this year notified “electoral bonds” that can be bought from specified branches of the SBI and used to donate money to political parties. According to the scheme, no person should make a cash donation of over Rs 2,000 to a political party.
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