As we all know their are various announcements made since February 2020, regarding Income tax slab, new filing rules, applicability of tax savings etc. Hence through this article we have tried to form a summary points for announcements made by CBDT in respect of Income tax rules and filing procedure.
1. Income
Tax New disclosures asked in the new ITR forms 1 to 7 are: 1. House
ownership: Individual taxpayers who are joint owners of house property
cannot file ITR 1 or ITR4.
2. Passport: One needs to disclose
the Passport number if held by the taxpayer. This is to be furnished
both in ITR 1-Sahaj and ITR 4-Sugam. Hopefully, it will be made
mandatory in other ITR Forms as and when they are notified.
3.
Cash deposit: For those filing ITR 4-Sugam, it has been made compulsory
to declare the amount deposited as cash in a bank account, if such
amount exceeds Rs 1 crore during the FY.
4. Foreign travel: If
you have spent more than Rs 2 lakh on travelling abroad during the FY,
you need to disclose the actual amount spent.
5. Electricity
consumption: If your electricity bills have been more than Rs 1 lakh in
aggregate during the FY, you need to disclose the actual amount.
6.
Investment details: Details of investment qualifying for deduction
under chapter VIA with bifurcation of details of investment made during
the period from April 1, 2020 to June 30, 2020.
7. For every
assessment year, the last date for filing tax returns is July 31,
However, this year ITR filing date has been extended till November 30,
2020 due to pandemic Covid-19.
8. Income Tax Exemptions and
Deductions that you can claim under the New Tax Regime for FY 2020-21
(AY 2021-22): Withdrawal by an employee from the Employees' Provident
Fund (EPF) is not taxable after 5 years of continuous service.
9.
Withdrawal from National Pension Scheme (NPS) on maturity or premature
closure up to 40% of the amount received on such withdrawal remains tax
free for all. In case of partial withdrawal from NPS, up to 25% of the
contributions made by the individual will be tax free. Employer’s
contribution to NPS up to 10% of their basic salary and dearness
allowance also remains tax free.
10. Under Section 10 (10D) of
the Income Tax Act, the sum assured and any bonus paid on maturity or
surrender of the life insurance plan is tax free. Maturity proceeds
continue to be exempt under Section 10(10D) even in the new regime. The
maturity amount including interest received on the Sukanya Samriddhi
Yojana will not attract any tax.
11. Conveyance Allowance
granted to meet expenditure incurred on conveyance in performance of
duties of an office and any allowance granted to an employee to meet the
cost of travel on tour or on transfer (including relocation) are tax
free.
Interest received from post office savings account balance up to Rs3,500 annually per individual will remain free from tax.
12.
Any scholarship granted to meet education costs is tax exempt under
Section 10 (16) of the Income Tax Act. Gratuity received from the
employer up to Rs20 lakh after rendering 5 years of continuous service.
Leave en-cashment received at the time of resignation or retirement up to
Rd3 lakh.
13. Form 26AS will now be a complete profile of the
taxpayer w.e.f. 01.06.2020, CBDT vide Notification dated May 28, 2020
amended Form 26AS in Sec 285BB w.e.f. 01.06.2020. Key takeaways are:
14.
New form 26AS will also provide information in respect of “Specified
financial transactions” which include transactions of purchase/ sale of
goods, property, services, works contract, investment, expenditure,
taking or accepting any loan or deposits of such value as may be
prescribed but not less than of Rs 50,000.
15. Information
about income tax demand, refund, proceedings pending, and proceedings
completed which may include assessment, reassessment under section
148, 153A, 153C, revision, appeal will also be shared in this form 26 AS.
16. Information on this form 26AS will not be a one-time
affair at year end. This will be a live 26AS, as this will be updated
regularly within 3 months from the end of the month in which such
information is received.
17. Form 26AS will now be a
complete profile of the taxpayer for that particular year as against
earlier form 26AS which just provided the information about taxes paid by way of TDS/TCS or self-assessing. This form will also have mobile no, email I’d and Aadhar no. of the taxpayer.
18.
Further an enabling provision has been notified empowering the CBDT to
authorise DG Systems or any other officer to upload in this form,
information received from any other officer, authority under any law.
Thus any adverse action initiated or taken or found or order passed
under any other law such as custom , GST , Benami Law etc. including
information about Turnover , import , export etc. will also be put in
this form 26AS so that not only the concerned taxpayer but also all the
Income Tax authorities will know and have access to such information.
19. This form 26AS will also provide information received
by Tax Deptt from any other country under the treaty /exchange of
information about income or assets of the taxpayer located outside
India.
20. The implication of this new form 26AS will be that
banks , financial institutions or any other authority or customer ,
buyer etc. while carrying out due diligence of the person/ corporate
concerned will now ask for form 26AS so as to be sure that there are
not any major issues about such person/corporate.
21. This
will now make difficult for any taxpayer to hide information from any
bank / financial institution/ authority about any proceedings against
under any law or tax demand, tax disputes etc, So mandatory passport
no. is to be mentioned, applicable for all.
Sources:
Various publications
Disclaimer: The
information provided herein is based on publicly available information and
other sources believed to be reliable, but involve uncertainties that could
cause actual events to differ materially from those expressed or implied in
such statements. The document is given for general and information purpose and
is neither an investment advice nor an offer to sell nor a solicitation. While
due care has been exercised while preparing this document, we do not warrant
the completeness or accuracy of the information. We will not accept any
liability arising from the use of this material. The recipient of this material
should rely on their investigations and take their own professional advice.
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