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News Direct Tax-Income Tax

  • Mar 29, 2023
  • Aadhaar-PAN Link Last Date Extension 2023: PAN Card-Aadhaar Card Linking Deadline Extended Till June 30

    Aadhaar-PAN Link Last Date Extension Latest News: It’s confirmed! PAN-Aadhaar linking deadline has been extended till 30th June 2023, the Central Board of Direct Taxes (CBDT) said in a notification today (March 28).

    The CBDT said in its notification that the deadline has been extended to provide some more time to taxpayers to link their PAN and Aadhaar.

    PAN cardholders will now be able to intimate their Aadhaar to the prescribed authority for Aadhaar-PAN linking without facing repercussions till 30th June. (Check: Full text of CBDT’s notification)

  • Mar 28, 2023
  • Government likely to extend PAN-Aadhaar linking deadline; may charge late fee

    The government is likely to extend the deadline for linking the permanent account number with Aadhaar by another two-three months, officials said.

    The Central Board of Direct Taxes could issue a notification to this effect soon, a government official, privy to the development, told ET.

    However, a fee will have to be paid for the period. The last date for linkage of PAN-Aadhaar is March 31, 2023.The CBDT had, while extending the deadline on March 30, 2022 by one year, set a fee of Rs. 500 for up to three months from 1st April, 2022 and Rs.1000 after that.

  • Mar 27, 2023
  • New income tax regime, other rules to kick in from Apr 1: What taxpayers need to know

    As is the case with each financial year (FY), the upcoming FY (2023-24) will also begin on April 1. The announcements made by finance minister Nirmala Sitharaman in the annual Feb 1 budget, too, will come into effect as part of the new financial year. In Budget 2023, one of her announcements pertained to the old and new income tax regimes.

  • Mar 25, 2023
  • Government proposes tax relief for REITs, InVITS

    In a relief to REITs and InVITs, the Finance Bill on Friday proposed to treat distribution from business as return of capital. While presenting the Union Budget on February 1, the government had proposed to tax income distributed by business trusts like REITs and InVITs in the form of debt repayments at the hands of unitholders.

    However, the government on Friday proposed to soften the tax impact on Real estate investment trusts (REITs) and Infrastructure investment trusts (InVITs) through amendments to the Finance Bill 2023.

  • Mar 25, 2023
  • Long term capital gains in international mutual funds to be taxed as per the investor tax slab

    Presently, international mutual funds, for the purpose of taxation are treated as debt funds. Now, as the taxation of debt fund is going to change, so will the taxation of international fund as per the Finance Bill, 2023 tabled by Union Finance Minister Nirmala Sitharaman and later passed by the Lok Sabha on Friday.

    In an international mutual fund, the short-term gains arising within three years are taxed at the investor’s applicable tax slab while long-term gains are taxed at 20 per cent after indexation benefits, or at 10% without indexation.

    “Currently, pure International funds are taxed similarly to debt funds and enjoy indexation benefits. As per the new amendment, funds with less than 35% exposure to Indian or domestic equities will get impacted.

  • Mar 25, 2023
  • Withholding tax on royalties to non-resident firms hiked to 20%

    The government has doubled the withholding tax rate on royalties and fees for technical services earned by non-resident companies to 20% from 10%. The change has been brought about through the amendments made to the Finance Bill, 2023 by finance minister Nirmala Sitharaman on Friday.

    While many companies are covered by double taxation avoidance agreements, under which they would get the beneficial tax rate of 10-15%, experts said it would lead to a higher compliance burden, as they would still require the tax residency certificate and related documentation from the foreign firm to avail the tax benefit.

    The withholding tax is usually paid by the Indian company and India Inc is still weighing out the impact of the move on their policies. “The rate under the Income Tax Act has been increased to 20%.

  • Mar 25, 2023
  • Slew of tax incentives for non-resident investments in IFSC

    India’s International Financial Services Centre (IFSC) at GIFT City could become more attractive to investors with a slew of tax incentives brought in through the amendments to the Finance Bill, 2023 including extending a 100% tax holiday available to non-residents for income from portfolio of securities in accounts in offshore banking units for a full 10-year period.

    “The amendment proposes that income received by non-residents from portfolio of securities in an account maintained with the Offshore Banking Unit in IFSC will be exempt to the extent such income accrues or arises outside India,” said Gopal Bohra, partner, NA Shah Associates.

  • Mar 25, 2023
  • Nil tax even for income a tad above Rs 7 lakh

    In a move that could incentivise more taxpayers to move to the concessional income tax regime, the finance ministry has introduced a marginal relief for those earning just a little more than Rs 7 lakh a year. This would ensure that their tax burden won’t include paying any tax, like others below the Rs 7-lakh income threshold.

    The change has been introduced through the amendments to the Finance Bill, 2023 that was passed by the Lok Sabha on Friday. Individual taxpayers having borderline income will get a deduction of income tax payable in excess of the differential income above Rs 7 lakh.

  • Mar 25, 2023
  • Angel tax on NRI investors may worsen funding winter

    Indian startups failed to receive any relaxations from the proposed changes to the angel tax provision, which seeks to include foreign and non-resident Indians under the tax regime.

    While the Finance Bill passed by Lok Sabha on Friday did not provide any relaxation to investors despite requests from the startup ecosystem, a note shared by the ministry of finance said concerns raised by stakeholders would be addressed. “The draft rules related to valuation shall be shared with the stakeholders for their inputs in the next month itself, viz April,” the note added.

  • Mar 23, 2023
  • New app for taxpayers to view TDS, interest, dividend income information

    The Income Tax department on Wednesday said it has launched the ‘AIS for Taxpayer’ mobile app which will give taxpayers a comprehensive view of their information related to TDS/TCS, interest, dividends and share transactions, and an option to provide feedback.

    The mobile app will facilitate taxpayers to view their information as available in the Annual Information Statement (AIS)/ Taxpayer Information Summary (TIS).

  • Mar 23, 2023
  • Inherited assets tax: ITAT bats for legal heir

    The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has settled in a recent order the contentious issue relating to determining the cost of acquisition and the indexed cost in case of inherited assets.
    In this case of US resident Sohrab Fali Mehta, the ITAT bench disagreed with the tax department that the indexed cost of acquisition should be based on the year in which Mehta inherited his share following his mother’s death. The tax tribunal, which adjudicates income tax (I-T) disputes, held that the indexed cost of acquisition has to be computed with respect to the year in which the initial owner first held the asset.

  • Mar 22, 2023
  • Govt evaluating measures to bring down tax burden on PE/VCs in India

    The government is evaluating measures to bring down the tax burden on foreign investors that put money in alternative investment funds (AIFs), which include venture capital (VC) and private equity (PE) domiciled in India. The move follows the report submitted by a panel led by M Damodaran, former chairman of the Securities and Exchange Board of India (Sebi), in December.

  • Mar 21, 2023
  • Tax demands of Rs 13,566 crore raised in four fiscals under black money law: MoS Finance

    The income tax department raised tax demands amounting to Rs 13,566 crore during the last four financial years under the black money law to deal with undisclosed foreign income and assets, the government told Parliament on Monday. In a written reply to a question in the Lok Sabha, Minister of State for Finance Pankaj Chaudhary informed that 183 assessment orders were passed in 2021-22 and a demand of Rs 5,350 crore was raised under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

    In the four fiscals starting 2018-19, a total of 349 assessment orders were passed and a demand totalling Rs 13,566 was raised.

    The minister also informed that 648 disclosures involving undisclosed foreign assets worth Rs 4,164 crore were made during three months of a one-time compliance window, which closed on September 30, 2015, under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

  • Mar 16, 2023
  • New Income Tax rules to kick in from April 1; all you need to know about the changes

    As we approach the new financial year, it is important to know beforehand about the changes in income tax rules, as this is also when the proposed finance bill comes into force. It keeps us prepared and ready for the changes needed to fine-tune our portfolio.

    Based on the proposals made in Budget 2023, Neeraj Agarwala, Partner, Nangia Andersen India, shared some new tax rules to kick in from April 1:

  • Mar 15, 2023
  • How to get a tax deduction of up to Rs 9.5 lakh just by investing in NPS

    Have you used up tax-saving deductions like sections 80C, 80D and 80TTA of the Income-tax Act, 1961? Are you looking for more options to bring down your tax liability further? If you answered yes to both these questions, then investing in the National Pension System (NPS) can help you save tax (subject to certain conditions).

    The NPS allows you to invest more than Rs 2 lakh in a financial year which can help you bring down your tax liability.

    Here is a look at how you can invest more than Rs 2 lakh in NPS to save tax.

  • Mar 14, 2023
  • 68,000 cases picked up for e-verification for income mismatch in AIS, ITR for FY 2019-20

    As many as 68,000 cases have been picked up for e-verification by the income tax department for unreporting or under reporting of income in tax returns for 2019-20 fiscal, CBDT chief Nitin Gupta said on Monday. Under the e-verification scheme, the I-T department informs the taxpayers about mismatch in Annual Information Statement (AIS) about financial transaction and the I-T returns filed. The taxpayer can reply to the tax department giving explanation for the mismatch or can file updated returns if they feel the mismatch flagged in e-verification notice is correct.

    "On a pilot basis, about 68,000 cases pertaining to 2019-20 fiscal have been taken up for e-verification based on risk management parameters set by the department. Of this, in 56 per cent cases or 35,000 cases the taxpayer have already satisfactorily replied to the notice or filed updated tax return," Gupta said.

  • Mar 14, 2023
  • Errors in AIS financial transactions? What to do if you get an e-verification notice from tax department

    Taxpayers can raise objections if they spot errors in the financial transactions in their Annual Information Statement (AIS). Once you raise the issue the tax department will check with the source. If the mismatch continues, a notice under the e-verification scheme can be issued.

    According to a tax department advertisement dated March 14, 2023, “Check the financial transaction available in AIS tab of your income tax account at Income tax website. If you disagree, raise an objection. We will check with the Source. If the mismatch continue, notice under the e-verification scheme may be issued. In such cases, return of income can be updated u/s139(8A) of the IT Act, 1961, subject to eligibility."

  • Mar 13, 2023
  • Growth in direct tax revenue moderates, up 16.8% on-year

    Direct tax collections grew 16.8% on year so far in the current fiscal year, led by a robust growth in personal income tax.
    According to data released by the finance ministry on Saturday, the collections, net of refunds, was Rs 13.73 trillion until March 10 this fiscal.

    “This collection is 96.67% of the total Budget estimates and 83.19% of the total revised estimates (RE) of direct taxes for the fiscal 2022-23,” said an official release.

  • Mar 13, 2023
  • Clear rules on angel tax next month

    The finance ministry will come out with the guidelines on the proposed angel tax next month to clarify how the tax will be levied and will also provide valuation guidelines. However, there will be no rethink on the Budget proposal to make the levy applicable to non-residents as well.

    “Genuine startups registered with the department for promotion of industry and internal trade (DPIIT) will not be impacted. Valuation rules on how the investment will be calculated will also be issued. The objective is not to hurt genuine businesses but only ensure that those people who are trying to evade taxes come under the tax net,” said a person familiar with the development.