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News Direct Tax-Income Tax

  • Sep 24, 2021
  • Do you have to report cryptocurrency investments as foreign assets in your income tax return?

    Most experts agree that gains or losses in cryptocurrency trading have to be reported in your income tax return (ITR). However, there is no clarity on whether the cryptocurrency investments have to be reported in ITR even if there has been no trading and no gains/losses from the same.

    As per current income tax laws, an individual is required to report all of his/ her foreign assets irrespective of his/her income level. So do you have to report your cryptocurrency investments while you file your ITR for the financial year 2020-21?

    What the income tax rules state
    Here is what the current income tax rules state about reporting of cryptocurrency holdings in your ITR:
    1) If an individual's net taxable income exceeds Rs 50 lakh, then he/she will have to report their assets and liabilities using Schedule AL of the ITR form.

    2) Similarly, if an individual is holding foreign assets such as investments in stocks listed in the US, then he/she has to report all his assets and liabilities irrespective of total income in a financial year. An individual having foreign assets or who is a beneficiary of any asset or having signing authority in any account located outside India is mandatorily required to file ITR even if his/her gross total income is below the basic income exemption limit.

  • Sep 24, 2021
  • Some e-filing glitches remain, working with I-T dept: Infosys

    Acknowledging that some users continued to experience difficulties on the Income Tax e-filing portal, IT major Infosys on Thursday said it was working “expeditiously” with the I-T department to further streamline end-user experience.

    “Even as it makes steady progress, Infosys recognises the ongoing challenges faced by some users and has engaged with more than 1,200 taxpayers directly to better understand their concerns. The company is focused on rapidly resolving these challenges while working closely with the Chartered Accountant community to ensure that a comprehensive set of user scenarios are supported and thoroughly tested before deployment,” the company said in the post.

    The Bengaluru-based technology services giant said over 30 million taxpayers had logged into the portal and have completed various transactions.

  • Sep 23, 2021
  • Over 3 crore taxpayers successfully complete transactions. 1.5 crore Income Tax Returns filed: Infosys

    Over three crore taxpayers have successfully completed transactions and close to 1.5 crore Income Tax Returns filed in the new I-T portal, Infosys said in a statement today.

    "Over the last few weeks, the portal has seen steady increase in usage with taxpayers’ concerns being progressively addressed. So far over 3 crore taxpayers have logged into the portal and have successfully completed various transactions. Even as the portal makes sustained progress with crores of taxpayers successfully performing transactions, the Company acknowledges the difficulties some users continue to experience and is working expeditiously, in collaboration with the Income Tax Department, to further streamline end-user experience," the company said in a BSE filing on September 23.

    This comes after the persistent glitches the Infosys’ new e-filing portal faced since the launch on June 7. Persistent glitches forced Finance Minister Nirmala Sitharaman to call Infosys’ executives for meeting twice, in June and on August 23. Sitharaman gave the IT major time till September 15 to get the portal in order.

  • Sep 18, 2021
  • PAN-Aadhaar linking deadline extended! If not linked by this date, your PAN may become inoperative

    The last date to link Aadhaar with PAN has been extended by the government. The last date for linking Aadhaar with PAN will now be March 31, 2022. Earlier, the last date to link PAN card with Aadhaar card was September 30, 2021. There has been an extension of 6 months granted for PAN-Aadhaar linking.

    Keeping in view the difficulties faced by taxpayers, the Central Government had earlier also issued a notification regarding extention of the last date for the intimation of Aadhaar number and linking thereof with PAN to September 30, 2021 which now has been extended till end March 31, 2022.

    If you already have the permanent account number (PAN ) card and are eligible to obtain Aadhaar number or you have already acquired one, then you are required to intimate the Aadhaar number to the Income Tax Department.

  • Sep 17, 2021
  • Relief for M&As, company rejigs on carrying forward losses

    A tax tribunal has ruled that losses can be carried forward for eight years if the “effective” shareholding doesn’t change, an order that could impact several M&As and group restructuring exercises.

    In case of any M&A or an internal group restructuring, if the effective shareholding of the major shareholders remains at least 51% even after the deal, losses in the merged entity can be used to set off future tax liabilities.

    The Mumbai Appellate Tax Tribunal (ITAT) in its ruling in the case of Tata Realty said any deal has to see whether the ultimate shareholder continues to hold a similar stake after such a deal.

  • Sep 16, 2021
  • Infosys's deadline ends, but bugs in tax-filing portal remain

    The new Income Tax e-filing portal developed by Infosys continued to face glitches despite the September 15 deadline set by the government to iron out issues on the platform.

    The portal, which went live on June 7, has been plagued with technical problems, drawing the ire of the finance ministry as well as taxpayers who have voiced their concerns on social media networks. “For individuals, it is difficult to file. Some of the features such as pre-filled form for interest payments on FD and others are still not updated,” said Chandan Kumar Hegde, president of the Karnataka State Chartered Accountants’ Association. “We have made presentations (to the government and Infosys). Maybe 50-60% of it is implemented.”

  • Sep 13, 2021
  • Keep tax regime simple to check dodging, Supreme Court tells govt

    The Supreme Court has provided a major tax relief to banks’ earnings from investments in bonds, securities and shares and advised the government to keep its tax regime simple to prevent avoidance of tax liabilities.
    In giving the advice, a bench of Justices Sanjay K Kaul and Hrishikesh Roy quoted 18th century economist Adam Smith, who in his ‘Wealth of Nations’ had said, “The tax which each individual is bound to pay ought to be certain and not arbitrary. The time of payment, the manner of payment, the quantity to be paid ought all to be clear and plain to the contributor and to every other person”.
    “Just as the government does not wish for avoidance of tax equally, it is the responsibility of the regime to design a tax system for which a subject can budget and plan. If proper balance is achieved between these, unnecessary litigation can be avoided without compromising on generation of revenue,” Justice Roy said, writing the judgement for the bench.
    Justice Roy said, "It needs to be observed here that in the taxation regime, there is no room for presumption and nothing can be taken to be implied. The tax an individual or a corporate is required to pay, is a matter of planning for a taxpayer and the Government should endeavour to keep it convenient and simple to achieve maximization of compliance."

  • Sep 13, 2021
  • Income Tax refunds worth Rs 70,120 crore issued between April 1 and September 6

    The Income Tax Department on Sunday said it has issued refunds of over Rs 70,120 crore till September 6 this year. Of this personal income tax refunds of Rs 16,753 crore have been issued in over 24.70 lakh cases and corporate tax refund of Rs 53,367 crore have been issued in 1.38 lakh cases.

    "CBDT (Central Board of Direct Taxes) issues refunds of over Rs 70,120 crore to more than 26.09 lakh taxpayers between 1st April, 2021 to 6th September, 2021," the Income Tax Department tweeted.

  • Sep 11, 2021
  • Govt allows disinvested PSUs to set off past losses

    Ahead of the strategic disinvestment of Air India and fuel retailer-cum-refiner BPCL, the government on Friday said losses incurred by disinvested public sector undertakings (PSUs) in previous years can be carried forward and set off.

    “In order to facilitate the strategic disinvestment, it has been decided that Section 79 of the Income-tax Act, 1961, shall not apply to an erstwhile public sector company which has become so as a result of strategic disinvestment,” the Central Board of Direct Taxes (CBDT) said. “Accordingly, loss incurred in any previous year prior to, and including, the previous year of strategic disinvestment shall be carried forward and set off by the erstwhile public sector company.”
    “The above relaxation will cease to apply from the previous year in which the company, that was the ultimate holding company of such erstwhile public sector company immediately after completion of the strategic disinvestment, ceases to hold, directly or through its subsidiary or subsidiaries, 51% of the voting power of the erstwhile public sector company” it said.

    Necessary legislative amendments for the above decision shall be proposed in due course of time, CBDT said.

  • Sep 10, 2021
  • ITR filing due date for AY 2021-22 extended! Check new deadline to file income tax return

    Keeping in view the difficulties reported by taxpayers and other stakeholders in filing of Income Tax Returns as well as the various reports of audit for the Assessment Year 2021-22 under the Income-Tax Act, 1961, the Central Board of Direct Taxes (CBDT) has decided to further extend the due dates for filing of Income Tax Returns and various reports of audit for the Assessment Year 2021-22.

    The due date of furnishing of Return of Income for the Assessment Year 2021-22, which was 31st July, 2021 under sub-section (1) of section 139 of the Act, as extended to 30th September, 2021, is now further extended to 31st December, 2021.

    The due date of furnishing of belated/revised Return of Income for the Assessment Year 2021-22, which is 31st December, 2021 as extended to 31st January, 2022, is now further extended to 31st March, 2022.

    ITR Filing Date 2021
    The ITR filing last date for AY 2021-22 has now been extended and instead of 30th September, 2021, the income tax return due date now stands at December 31, 2021.

    “The CBDT has notified the extension in filing deadlines for tax returns. For individuals the tax filing deadline of July 31 2021 was extended to September 30 2021. This due date is now further extended this filing deadline to December 31 2021. This is a welcome move considering the glitches of the tax website has still to be resolved. However, one needs to note that where taxes are payable, the interest levy for default and deferment in advance taxes would continue till the filing of the tax return. Hence it is ideal that the tax payers pay taxes and file their returns as soon as feasible,” says Aarti Raote, Partner, Deloitte India.

  • Sep 09, 2021
  • Income tax portal's tech issues being progressively addressed; 1.19 crore ITRs filed: CBDT

    The income tax department on Wednesday said a number of technical issues on the new ITR portal are being progressively addressed and 1.19 crore ITRs for 2020-21 fiscal year have been filed so far.

    Giving updates of activities carried out by taxpayers on the portal, the I-T department said over 8.83 crore unique taxpayers have logged into the portal till September 7, 2021 with a daily average of over 15.55 lakh in September.

    The Income Tax Return (ITR) filing has increased to 3.2 lakh daily in September 2021. "A number of technical issues are being progressively addressed and there has been a positive trend reflected in the statistics of the various filings on the portal.... 1.19 crore ITRs for AY 2021-22 have been filed.

    "Of these, over 76.2 lakh taxpayers have used the online utility of the portal to file the returns," the Central Board of Direct Taxes (CBDT) said in a statement.

  • Sep 09, 2021
  • Tax portal 2.0 to integrate with bourses to track trade transactions

    The income-tax (I-T) department is working on integrating the new e-filing portal with stock exchanges to help tax authorities track trade transactions, including futures and options.

    The integrated system will look at discrepancies between the data disclosed by an assessee and match it with data fetched from stock exchanges, using artificial intelligence, said two officials in the know.

    This will help detect and red-flag such matters, particularly those related to non-filers of income-tax return (ITR).

    The department aims to achieve this integration this fiscal year.

    This comes at a time when there are concerns over growing retail participation in the equity markets.

    The share of individual retail investors in the National Stock Exchange’s cash market turnover has shot up from 39 per cent in 2019-20 to 45 per cent in 2020-21.

    After integration, the portal will automatically compare the turnover on exchanges, based on the permanent account number, with the reported figures in the respective ITRs.

    Accordingly, tax authorities will process the data and take up those matters for further scrutiny.

    Eventually, the portal will integrate the database from depositories, clearing corporations, and registrars with issue-and-share transfer agents and other intermediaries.

    “The automatic exchange of information or real-time exchanges or even full integration of database has been under discussion.

  • Sep 08, 2021
  • Income Tax: Authentication of e-records made easier

    To ease the process of authentication of electronic records in faceless assessment proceedings, the government has amended Income Tax Rules, 1962, to provide that electronic records submitted through registered account of the taxpayers in the Income Tax Department’s portal would be deemed to have been authenticated by the taxpayer by electronic verification code (EVC).

    So, when a person submits an electronic record by logging into his registered account in designated portal of the Income Tax Department, it would be deemed that the electronic record has been authenticated by EVC for the purposes of section 144B(7)(i)(b) of the Income Tax Act, 1961, the department said in a statement.
    Under the existing provisions of section 144B(7)(i)(b) of the Act, this simplified process of authentication by EVC is not available to certain persons (such as companies, tax audit cases, etc.) and they are mandatorily required to authenticate the electronic records by digital signature.

    In order to provide the benefit of the simplified process of authentication by EVC to these persons, it has been decided to extend the simplified process of authentication by EVC to these persons also.

    Hence, the persons who are mandatorily required to authenticate electronic records by digital signature shall be deemed to have authenticated the electronic records when they submit the record through their registered account in the Income Tax Department’s portal. “Legislative amendments in this regard shall be proposed in due course,” it said.

  • Sep 08, 2021
  • Taxpayers can file applications for settlement till September 30

    In order to provide relief to the taxpayers who were eligible to file applications as on January 31, 2021, but could not file the same due to cessation of the Income Tax Settlement Commission (ITSC) through Finance Act, 2021, the Central Board of Direct Taxes (CBDT) has allowed them to file applications for settlement till September 30.

    The Finance Act, 2021 has amended the provisions of the Income Tax Act, 1961 to close ITSC with effect from February 1, 2021. In order to dispose off the pending settlement applications as on January 31, the CBDT had constituted Interim Board for Settlement on August 10.
    It has been represented that a number of taxpayers were in advanced stages of filing their application for settlement before the ITSC as on February 1. Further, some taxpayers have approached High Courts requesting that their applications for settlement may be accepted. In some cases, the High Courts have given interim relief and directed acceptance of applications of settlement even after February 1. This has resulted in uncertainty and protracted litigation.

    So, CBDT has decided to give an opportunity to taxpayers to file applications subject to conditions: the assessee was eligible to file application for settlement on January 31, 2021, for the assessment years for which the application is sought to be filed; and all the relevant assessment proceedings of the assessee are pending as on the date of filing the application for settlement.

    Legislative amendments in this regard shall be proposed in due course, the CBDT said.

  • Sep 06, 2021
  • Net direct tax receipts up 95% on-year in FY22

    The Union government’s net (post-refunds) direct tax collections rose 95% on-year to Rs 3.7 lakh crore till September 2 of the current financial year, thanks to a low base, a pick-up in economic activities, higher corporate earnings and better compliance.

    The robust collections are despite a surge in refunds. Net direct tax collections were just Rs 1.9 lakh crore till September 2 of FY21, owing to the Covid-induced lockdowns hat hit economic activities.
    In fact, the net direct tax collections till September 2 appears to be substantially higher than the corresponding period of the pre-pandemic year of FY20. Such collections till September 2 this fiscal year were 31% higher than the receipts till August 31 in FY20.

    However, for receipts to meet the annual target of Rs 11.08 lakh crore — which requires only a 17% growth — the collections have to remain robust in the remaining period of the fiscal too. Last year, the collections picked up in the second half of the year. The April 1 to September 2 receipts were just 33% of the FY22 target of Rs 11.08 lakh crore.

  • Sep 06, 2021
  • Forms for exemption from I-T returns for senior citizens of 75 years & above notified

    The income tax department has notified declaration forms to be filed by senior citizens aged 75 years and above with the banks to get exemption from filing I-T return for fiscal year 2021-22.

    The 2021-22 Budget had introduced a provision for exempting senior citizens of 75 years and above having pension income and interest from fixed deposit in the same bank from filing income tax returns for the financial year beginning April 1.
    The Central Board of Direct Taxes (CBDT) has now notified rules and declaration forms which senior citizens would have to file with the specified bank who in turn would deduct tax on pension and interest income and deposit with the government.

    Such exemption from ITR filing would be available only in case where the interest income is earned in the same bank where pension is deposited.

  • Sep 06, 2021
  • Senior citizens aged 75 and above are not exempted from ITR filing this year

    In Budget 2021, the government announced that eligible senior citizens aged 75 and above will be exempted from filing income tax returns (ITR). However, it should be noted that this relaxation will come into effect only from FY 2021-22, i.e., for ITRs to be filed next year. What this means is that for FY 2020-21, i.e., for ITRs to be filed this year, senior citizens who are above the age of 75 years are not exempted from ITR filing. Currently, the last date for filing ITR for FY 2020-21 is September 30, 2021.

    As per the memorandum to the Budget 2021, "In order to provide relief to senior citizens who are of the age of 75 years or above and to reduce compliance for them, it is proposed to insert a new section to provide a relaxation from filing the return of income."
    Abhishek Soni, CEO, Tax2win.in, an ITR filing website says, "The amendment related to relaxation for senior citizens (Age 75 years or more) in the filing of ITR after fulfilling certain conditions will be applicable from FY 2021-22 (assessment year 2022-23). Hence, it is important to note that if your income is more than the basic exemption limit, then you are required to file ITR for FY 2020-21."

  • Sep 02, 2021
  • Calculation of taxable interest on PF contributions – Government issues notification

    As of now, interest earned on provident fund balance is fully exempted from tax in the hands of the employee. However, in Budget 2021, the Finance Minister Nirmala Sitharaman had proposed taxability of interest on various provident funds, where the specified limit exceeds. The government has issued a notification regarding the calculation of taxable interest relating to contribution in a provident fund or recognised provided fund, exceeding specified limit. The Income-tax (25th Amendment) Rules, 2021 will come into force on 1st day of April, 2022.

    “CBDT has been pro-active in providing necessary clarifications through its notifications and circulars to ensure that the tax payers have requisite guidance and certainty on the tax treatment to be accorded to the components of their income. The circular of the CBDT dated 31st August, 2021, is one such step which provides clarity on a very important aspects which concerns the salaried employees who contribute towards provident fund schemes.

  • Sep 02, 2021
  • Income Tax Return: With glitches in e-filing site yet to be removed, due date extension looks inevitable

    Even nearly two months after it was launched on June 6, 2021, the new Income Tax e-filing portal is yet to function properly and still has technical glitches that prevent taxpayers from completing several functions.

    After asking Infosys – the company which has developed the site – many times to resolve the issues, Finance Minister Nirmala Sitharaman has given a final deadline of September 15 to remove all the glitches, even as the extended due date of filing returns is September 30.
    Even if all the glitches are removed by September 15, it’s near to impossible for all the taxpayers to complete their return filing work within 15 days. So, is the extension of ITR filing due date inevitable?

    “Although the government has been continuously chasing Infosys for resolution of all issues / glitches faced by the users, the issues have not been entirely resolved till date. At the time of filing income tax returns, taxpayers are still encountering errors such as inaccurate capturing of details from Form 16, incorrect interest calculations, inability to e-verify the filed returns, Form 26AS details not being auto-populated, filed returns not being accepted for long periods, etc. Also, the income tax website was not available to the taxpayers for two days viz. 21st and 22nd August 2021 owing to emergency maintenance,” said Dr. Suresh Surana, Founder, RSM India.

  • Sep 02, 2021
  • JB Mohapatra named CBDT chairman

    JB Mohapatra has been appointed as the chairman of the Central Board of Direct Taxes, the finance ministry said in a notification Wednesday. Mohapatra had been officiating as the chairman of the Board since June this year.

    Mohapatra will succeed Prakash Chandra Mody, a 1982-batch Indian revenue services officer, who retired in May.

    The Appointments Committee of the Cabinet has approved the appointment.

    JB Mohapatra was a member of the board before he was given the responsibility of officiating as the Chairman, CBDT for a period of three months, in May.