Income Tax articles

Section 194IC – TDS on Payment Made Under Specified Agreement

1) Who is responsible to deduct tax u/s 194IC? Any person responsible for paying to a resident any sum by way of consideration under the specified agreement under section 45(5A) i.e. under the Joint Development Agreement, shall deduct tax at source. 2) What is meant by the Joint Development Agreement? Joint Development Agreement is an [&h...

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Section 194IB – TDS on Rent of Property

1) Who is responsible to deduct tax u/s 194IB? Any person, being an individual or a Hindu undivided family (not covered under section 194I), responsible for paying to a resident any income by way of rent exceeding ₹ 50,000 for a month or part of a month during the previous year, shall deduct income-tax thereon […]...

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Section 194IA – TDS on Purchase of Immovable Property

Preamble and Rational behind inserting Section 194-IA: Under section 195, on transfer of immovable property by a non-resident, tax is required to be deducted at source by the transferee. However, prior to 01-06-2013 there being no such requirement on transfer of immovable property by a resident except in the case of compulsory acquisition...

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Section 194F – TDS on Payments on account of repurchase of units by Mutual Fund or Unit Trust of India

1) Who is responsible to deduct tax u/s 194F? The person responsible for paying to any person any amount referred to in section 80CCB. 2) When to Deduct TDS under Section 194F? Tax is deductible at the time of payment.  3) Rate of TDS under Section 194F The rate of tax deduction u/s 194F is […]...

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Section 194E – TDS on Payments to Non-Resident Sportsmen or Sports Association

1) Who is responsible to deduct tax u/s 194E? Any person responsible for making following payment shall deduct tax at source:- Payee Nature of income (a) Non – resident foreign citizen sportsman (including an athlete) Income is by way of- a. participation in India in any game (other than card game or gambling, etc.); or […]...

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Section 194DA – TDS on Payment in respect of Life Insurance Policy

1) Who is responsible to deduct tax u/s 194DA? Any person responsible for paying to a resident any sum under a life insurance policy, including the sum allocated by way of bonus on such policy, other than the amount not includible in the total income under section 10(10D), shall deduct income-tax thereon.  2) When to […]...

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Detailed Analysis of TDS under Section 194-IA

Section 194-IA is very familiar but tricky section to implement in real life. Though it is effected from year 2013, so many people are still unaware about many different things related to 194-IA and hence today I am writing this all inclusive article on Section 194-IA which will include everything from basic section, its compliance, [&hel...

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Section 194BB – TDS on Winning from Horse Races

1) Who is responsible to deduct tax u/s 194BB? Any person, who is responsible for paying to any person any income by way of winnings from any horse race an amount exceeding ₹10,000 (₹5,000 upto 31.5.2016) shall deduct income-tax at the rates in force. Any person here means a book maker or a person to […]...

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Section 194 – TDS on payment of dividend

1) Who is responsible to deduct tax u/s 194? The principal officer of an Indian company or a company which has made the prescribed arrangements for the declaration and payment of any dividend (including dividends on preference shares) to a shareholder, who is resident in India, is required to deduct tax at source.  2) What […]...

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Section 194A – TDS on Interest (other than Interest on Securities)

1) Who is responsible for tax deduction (payer)? The person (other than an individual or a Hindu Undivided Family) who is responsible for paying to a resident any income by way of interests other than ‘interest on securities’ is required to deduct tax thereon at the rates in force. An individual or a HUF is […]...

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Section 194B TDS on winnings from Lottery, Game Shows, and Puzzle etc

1) Who is responsible to deduct tax u/s 194B? The person responsible for paying to any person any income by way of winnings from any lottery or crossword puzzle, card game and other game of any sort in an amount exceeding ₹ 10,000 shall, deduct income-tax thereon at the rates in force. Therefore, no tax […]...

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Section 192A – TDS on Payment of Accumulated Balance Due to an Employee

1) Who is responsible to deduct tax u/s 192A? Tax is to be deducted by the trustees of Employees’ Provident Fund Scheme, 1952 or any other person authorized under the scheme to make payment of accumulated sum to employees. 2) When to Deduct TDS under Section 192A? Tax is deductible at the time of payment. […]...

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Income Tax Search and Seizure Assessments- No universal application of “extrapolation technique” in Search Assessments

During the course of a Search and Seizure action, it is seen in practice that incriminating material in the form of documents, diaries and other evidences are found which sometime reflects undisclosed income of an assessee only for a particular limited period of time and not for all the assessment years to be covered u/s 153A of the Incom...

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Section 194C – TDS on Payment to Contractor

 1) Who is responsible to deduct tax u/s 194C? Any person, other than an Individual or HUF, responsible for making payment to a resident contractor or sub-contractor for carrying out any work (including supply of labour) is liable to deduct tax at source under Section 194C. However, an Individual or HUF, AOP/BOI is liable to […]...

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Cash Transaction Restrictions on Charitable Trusts under Income Tax

A charitable or religious institution has substantial source of receipts in form of donations. Such donations may be corpus or voluntary. The Income Tax Law provides blanket exemption to corpus contributions (received for a particular purpose such as for construction of a building) whereas it requires application of voluntary contribution...

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Cash Transactions in Agriculture Sector- Income Tax Provisions

In India, a large population is engaged in the agriculture sector and there are numerous transactions regarding sale and purchase of agriculture produce. The farmers sell their agriculture produce to Pacca Arahtias i.e. traders through kachha Arahtias. Kachha arahtia are commission agents and are only facilitators of auctions/sales of agr...

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Case Commentary on Vodafone International Holdings B.V. vs. Union of India (SC) & Formula One World Championship V CIT

Case Commentary on Vodafone International Holdings B.V. vs. Union of India (UOI) and Ors. (20.01.2012 – SC) and Formula One World Championship V CIT. TAX OPINION PAPER- CASE SUMMARY FOR VODAFONE AND FORMULA ONE CASE Vodafone International Holdings B.V. vs. Union of India (UOI) and Ors. (20.01.2012 – SC): MANU/SC/0051/2012 Voda...

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Section 194N TDS Provisions on Cash Transactions

Tax Deducted At Source Provisions on Cash Transactions Section 194N – TDS on cash withdrawal from banks/post offices [Applicable from September 1, 2019] Who is responsible to deduct tax u/s 194N? Every person, being,— (i) a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking in...

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Section 269SU: Mandating Acceptance of Payment through prescribed Electronic modes

The applicability of the provisions of section 269SU to those business entities who do not receive payments from retail customers was always in question. This is because it is not practical to receive payments from customers by B2B enterprises since they are distant and large customers who prefer to make payment by banking channels like...

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Disallowance u/s 40A(3) vs Restrictions on cash u/s 269ST

Example: Five separate invoices of Rs. 60,000 each were issued to a customer. The customer intends to make cash payment in installments of Rs. 10,000 each on daily basis. State the applicability of Sec 269ST and 40A(3)? As per sec 40A(3), if any payment is made by an assessee to a person in a day above Rs.10,000, other than […]...

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9 deductions that people miss out while filing their ITR

Chapter VI A of the Income Tax Act, 1961 provides for various deductions that are available from the total income of an assessee while computing the taxable income. The assessees are normally aware of certain common deductions such as deduction u/s 80C in respect to contribution made towards LIC, provident fund, deduction u/s 80D for [&he...

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Section 80D Deduction in respect of health insurance premia

Deduction in respect of health insurance premia under Section 80D Analysis of Section 80D In case of an Individual (a) Deduction in respect of insurance premium paid for family: A deduction to the extent of ₹ 25,000 is allowed in respect of the following payments- (1) premium paid to effect or keep in force an insurance on […]...

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Restrictions on Cash Transactions of Rs. 2 Lacs or More under Income Tax

Provisions of Section 269ST Section 269 T was inserted in the Income Tax Act, 1961 by the Finance Act, 2017. The government has aimed to curb generation of black money, to move towards less cash economy and promote digital economy. The government has attempted to target and penalize receiver instead of payer. It is applicable […]...

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Restrictions on Cash Transactions in Real Estate under Income Tax

Restrictions on Cash Transactions in Real Estate under Income Tax, 1961 (Section 50C, section 43CA and section 56(2)(x)) ♦ Stakes in transactions in immovable properties are quite high and so are the tax implications. It is not only perceived but an open secret in India that sale transactions of immovable properties are undervalued lead...

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Restrictions on Loans, Deposits & Advances- Section 269SS & 269T

Analysis of Section 269SS of the Act This section was introduced in the Act with the objective that Unaccounted cash found in the course of searches carried out by the Income-tax Department is often explained by taxpayers as representing loans taken from or deposits made by various persons. Unaccounted income is also brought into the [&he...

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Section 40A disallowance in case assessee opts for presumptive taxation u/s 44AD

Applicabilty of disallowance u/s 40A of the Act in case assessee opts for presumptive taxation u/s 44AD. Sec 40A relates to disallowance related to excess payment of related party, cash payment to a person in excess of Rs. 10,000 in a day, payment to unapproved fund, mark to market losses etc. The comparison of sec […]...

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Disallowance of Depreciation | Section 43(1) | Cash Payment for Fixed Assets

Disallowance of Depreciation section 43(1)) Disallowance of Depreciation where cash payment exceeding Rs. 10,000 is made for purchase of asset (Amendment to section 43(1)) Clause (1) of section 43 defines ‘actual cost’ for the purposes of claiming depreciation. The cost in acquisition of any asset or part thereof in respect of...

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Analysis of Section 40A(3) & Section 40A(3A) of Income Tax Act, 1961

Analysis of Section 40A(3) and 40A(3A) (a) Analysis of sec 40A(3) of the Act. Where payment is made in the year the expenditure is incurred: 100% disallowance of payment if in excess of Rs. 10,000 and not by a/c payee cheque/draft/ECS. [Sec 40A(3)] There are following two conditions for the applicability of this section. If both of [&he...

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Know when to say no to cash transactions

We were told by history that before advent of cash there was concept of barter system though barter system where there was no currency ‘no cash’ and things were exchanged according to needs and sooner society realized that barter system having its own series of advantages and disadvantages need to be left behind with time and later on...

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Stay Applications under the Income Tax Act, 1961

Sections 220 to 232 of the Income-tax Act deals with collection and recovery of taxes. These provisions will become active every year in the months of February and March. Probably each officer or Commissioner may have to report to the higher authority the taxes outstanding, and total collection of taxes in their charge. As the scope of th...

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Residential property and Tax on capital gain

When investors make profits on sale of assets like land, shares and mutual fund units, it is termed as capital gains. The investor has to pay tax on the resulting gains that is commonly referred to as capital gains tax. The amount of money outflow from your pocket depends on how long you held the property. If a residential property is hel...

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NRI investments – Some FAQs

One of the first things you should know as an NRI is that your existing bank accounts are no longer valid.The Foreign Exchange Management Act (FEMA) requires you to inform all the banks where you have an account,be it savings or deposits, about your changed residential status. ...

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Pre-filled ITR forms to make tax compliance more convenient

The Pre-filled Income Tax Return (ITR) forms are going to be available for taxpayers. This measure has been adopted in order to make the tax compliance convenient for the individual taxpayers, as notified by the Finance Minister, Nirmala Sitharaman....

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Common strategies used to avoid Permanent Establishment status

Avoidance of Permanent Establishment (PE) status of Non-Residents are made through various arrangements. Company structures their business in way that status of PE can artificially be avoided. The definition of permanent establishment included in tax treaties is therefore crucial in determining whether a non-resident enterprise must pay i...

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Income Tax Refund- Everyone wants it, not all get it!

Refund – Everyone wants it, not all get it!! Income tax refund! Sounds quite familiar, doesn’t it? Many of us would have received a refund from the income tax department in the past as well as many have claimed it but not received the same. So, let’s discuss when and how does one get a […]...

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Income Tax Relief for home buyers & Real Estate Developers

In a recent press conference conducted by the Hon’ble Finance Minister Ms. Nirmala Sitharaman on 12th November 2020 followed by a press release dated 13th November 2020, Diwali gift for the real estate developers and home buyers was announced in the form of income tax relief where a new amendment was proposed in section 43CA […]...

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Equalisation Levy- An Overview

Equalization levy was introduced by the Finance Act,2016 on certain non resident companies and related activities. The levy was applied @6% on certain 'specified services' such as online advertisement, any provision for digital advertising space or any other facility or services for the purpose of online advertisement if the aggregate amo...

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Buying your dream home becomes cheaper this Diwali!

As a part of the AatmaNirbhar Bharat Package 3.0, announced on 12th November 2020 our Hon. Finance Minister Smt. Nirmala Sitharaman – a relief has been provided to real estate developers and buyers, by increasing the percentage of safe harbor to 20%. One can now buy a house at a rate of 20% lower than the circle rate. This new norm is f...

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Declaration & Tax Treatment of Interim Dividend

As per Section- 2(35) ‘dividend includes interim dividend’ signifies that the provisions of Companies Act 2013, applicable to the final dividend to the extent possible, shall also applicable on interim dividend. As the word “interim” means “relating to less than a full year’s business activity” so the dividend de...

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Thank You FM for the Income Tax Relief to Real Estate Sector BUT enlargement of scope of Relief is necessary

On the occasion of Dhanteras, FM has announced an Atmanirbhar Bharat Package 3 for over Rs. 2.65 lakh crores. A Demand Booster has been announced for the Real Estate Sector by giving Tax relief for the Developers & Home Buyers under the Income Tax Act....

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Remove your confusions regarding ‘New Income Tax Regime’

You all know that a ‘New Tax Regime’ has been introduced from FY 2020-21 that says individual can reduce their taxes if they are not availing deductions or exemptions. You are provided an option where you can either go for the old tax structure or choose the new tax structure. Now the people are confused […]...

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Income tax on Selling gold

Income Tax Act of India specifies that profit from sale of gold bars, jewelry, coins or utensils or any other form of precious metal will attract tax under capital gains. The profit on sale of your gold holding is taxable under the head “Capital Gains” of Income Tax. Only exception to this is in case […]...

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How to file Income Tax Return of Deceased Person???

Many times we face to this question and find difficulty as to how to file income tax return of deceased person. As such the death of the person is not certain, the income earned by person who has expired can still be subject to taxes. According to the section 159 of the Income Tax Act, […]...

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Tax provisions relating to receipt and forfeiture of earnest money

Introduction The provisions of section 51 of the Income-tax Act deal with advance money received for transfer of a capital asset. As per the old provisions where any capital asset was on any previous occasion the subject of negotiations for its transfer, any advance or other money received and retained by the assessee in respect […...

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New Income Tax relief for Developers & Home Buyers

Income Tax relief for Developers & Home Buyers in Atmanirbhar Bharat Package 3.0 Differential between circle rate and agreement value in real estate income tax under Section 43 CA of IT Act has been increased from 10% to 20%. This is for primary sale of residential units up to ₹ 2 Crore (from date of […]...

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Should you invest in tax-free bonds?

One of my friends,  who had already decided to invest his retirement savings in such a way so that he does not have to pay any tax after his retirement and so wanted to invest in tax free bonds,  had called me to know about the tax-free bonds available. I discussed the matter threadbare with […]...

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A Practical Approach to TDS & TCS (Amended upto 31.10.2020)

About The Author Born in a humble middle-class family in Jalandhar (Punjab) in 1962, Ravinder, an avid academic turned every obstacle into opportunity through sheer hard work, graduated in Bachelors of Commerce from DAV College, Jalandhar. After graduation he stepped into nonetheless a rigorous course of accountancy from Institute of Char...

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First Tax Audit Report or Income Tax Return or both by same due date

In this article, the author highlights the issues faced by Tax Auditor and Assessee with respect to furnishing of Tax Audit Report one month prior to submission of Income Tax Return:...

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Deductions under Income Tax Act

There are different investments & expenditures which can be claimed as deduction while computing Total Income. Chapter VIA of the Income Tax Act 'Deductions to be made in computing Total Income' should must be referred before claiming any amount in Income Tax Return to ensure that the conditions mentioned therein are followed....

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Leave Travel Concession – Income Tax Exemption

Government has recently made an announcement on 29th October, 2020 in continuation to an earlier announcement made vide Office memorandum F.No. 12(2) /2020-EII (A) dated 12th October, 2020, that all non-central government employees will be eligible for income tax exemption for the entire leave travel concession amount maximum up to Rs 36,...

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Do you know the tax implications on Diwali gifts?

Diwali for everybody is like meeting their friends and exchanging gifts. The gifts can be sweets, dry fruits, and other valuable items like silver or gold coins. But did you ever thought that these gifts may have some tax implications too?? No… Everybody believes that these gifts are not taxable in their hands. You are […]...

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Remembering Demonetisation on its Fourth Birth Anniversary!!!

The primary reason for bringing out the Direct Tax Vivad Se Vishwaas Scheme 2020, as asserted by the learned Revenue Secretary is to ensure amicable resolution of disputes arising out of OCM/Demonetisation Cases. The Income-tax department has launched an aggressive outreach drive, wherein, a large number of jewellers and real-estate de...

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Are the gifts received on Deepawali tax-free in your hands?

Traditionally Deepawali is the major occasion when gifts are given and gifts are received. The items given as gifts vary from just boxes of dry fruit and sweet to valuable like gold and silver coins etc. Majority of the recipients of such gifts are under the impression that such gifts have no income tax implications, […]...

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Request to relax Tax Audit Limit from 60 to 90 as one time measure for A.Y. 2020-21

You are requested to relax the said general guidelines as a onetime measure to enhance it further to 90 for A Y 2010-21 due to the Covid-19 restrictions of travelling, maintaining social distance etc. This one-time measure will surely helpful to the members to complete their tasks with comfort....

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Faceless Assessments & Appeals: Missing Out on that Odd Cup of Tea with AO/CIT(Appeals) for a Far More Rewarding TEA of Transparency, Efficiency & Accountability!!!

Faceless Assessments & Appeals: Missing Out on that Odd Cup of Tea with AO/CIT(Appeals) for a Far More Rewarding TEA of Transparency, Efficiency & Accountability!!! Friends let me begin with an interesting question…. “What comes across your mind when you hear these terms and phrases- artificial intelligence, machine l...

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Important aspects one should know before filing the ITR

You must have heard about the extension in dates of filing ITR for FY 2018-19 (belated) & FY 2019-20. Here we will discuss about the dates and also some of the important aspects one should know with respect to changes in income taxes: Here’s a summary of extended dates 1. To file belated ITR for […]...

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Faceless asseseement under income tax

Extract from budget speech of Hon’ble union finance minister on 5th July 2019 “Para 124. The existing system of scrutiny assessments in the Income-tax Department involves a high level of personal interaction between the taxpayer and the Department, which leads to certain undesirable practices on the part of tax officials.  To elimina...

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Submission of Income Tax Return & Procedure for Assessment

Return of income is a special type of form to be used by the assesse to furnish necessary information – name, address, PAN/GIR No., Bank Account, income under each head, total income, tax liability, etc. before the income tax authority. Different types of forms are prescribed in Rule 12 of the Income Tax Rules, 1962 […]...

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Manual View/ Download Additional GST Notices & Demand Orders

How can I view additional orders/notices issued by the tax officer? To view additional orders/notices issued by the tax officer, perform following steps: 1. Access the www.gst.gov.in URL. The GST Home page is displayed. 2. Login to the portal with valid credentials. 3. Dashboard page is displayed. Click Dashboard > Services > Use...

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Comprehensive analysis of Section 44AD & related aspects

Comprehensive analysis of Section 44AD with other related aspects The provisions of Section 44AD were introduced in the Chapter of Profits & Gains from Business or profession to reduce the compliance burden of resident small Taxpayers. Undoubtedly throughout, the concept related to “Presumptive Taxation Schemes’’ has been very w...

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Analysis of Form 3CA, Form 3CB and Form 3CD – Part 1

Article is first part of series of articles in which Author will Analyse Form 3CA, Form 3CB and Form 3CD related to Tax Audit under Income Tax Act, 1961- 1. Form  3CA – Audit Report under Section 44AB in a case where the accounts of the business or profession of a person have been audited […]...

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Taxation of Capital Gains on Sale of Equity Shares- FAQs

Taxation of Capital Gains on Sale of Equity Shares [SECTION 112A] TAX ON LONG TERM CAPITAL GAINS ON CERTAIN ASSETS  Q.1 What type of assets are covered? Ans:  an equity share in a company or a unit of an equity oriented fund or Q.2 What is the rate of tax under this section? Ans: A […]...

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Contradiction between Dates in Form 3CD & dates for submission of Audit Reports

Clauses of Form 3CD which can’t be answered while submitting it by 30th November 2020 The Income Tax Act has been amended by the Finance Act 2020 and further amended by The Taxation And Other Laws (Relaxation And Amendment Of Certain Provisions) Act, 2020 to provide certain restrictions and/or relaxations in the existing provisions and ...

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Tax on income of certain domestic companies: Section 115BAA with case scenario study

Tax on income of certain domestic companies: Section 115BAA with case scenario study 1) Section 115BAA has been inserted w.e.f. A Y 2020-21 to provide for an optional alternative tax regime for domestic companies. The eligible corporate assessees are given an option to opt for a concessional rate of tax @25.17% ((22%+10%+4%) instead of th...

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Income Tax on Dividends- FAQs

FOR RESIDENT SHAREHOLDERS: When valid PAN is available in the records of the Company: Tax deduction rate on Dividend – 7.5%# When valid PAN is not available in the records of the Company: Tax deduction rate on Deividend- 20% #The tax rate has been reduced from 10% to 7.5% with effect from 14 May 2020 […]...

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Critical analysis & issues in Tax Audit Report & OI Schedule

Critical issues in the tax audit report and the interplay of the form OI with the Tax audit report. Of late many assesses are receiving the intimations from the tax department for the mismatches in the tax audit report and the income tax return filing, however when one looks into the matter it is quote […]...

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Issue of section 131(1A) notice after conclusion of Income Tax Search & Seizure

Issuance of notice under section 131(1A) of the Income Tax Act, 1961 after conclusion of Income Tax Search and Seizure under section 132 of the Income Tax Act, 1961. Introduction: Ever since the enactment of the original Income-tax statute of 1922, the Income-tax authorities have been vested with certain powers that are coterminous with t...

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The A-Z of TDS

When it’s Time for Your Employees to Pay Taxes, A Hundred Questions Fill Their Minds. How, How Much, Why to What, When and Why, Again. And Who Answers These Million Queries And More? You – The Deductor. He Who Calculates Taxes on Their Income and Makes Their Lives Easier, Month After Month, Year on Year. […]...

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Due Date Compliance Calendar November 2020

Article compiles due dates of compliance related to GST, Income Tax, ESI, PF Acts which includes compliance related to GSTR-1, GSTR-3B, ITC-04, GSTR-5 & 5A, GSTR-6, GSTR-7, GSTR-8,  RFD-10, Due dates for payment of TDS / TCS, Dues date for Payment of Advance Tax, Due date for Issue of TDS/ TCS Certificates, Due date for […]...

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TDS / TCS Rate Chart for F.Y. 2020-21 (A.Y: 2021-22)

What is TDS? Tax Deducted at Source (TDS) is a mechanism that has been introduced by the Income Tax Department. Under this, the responsible person is supposed to deduct a certain percentage of income as tax before making the payment to the receiver. The payment includes salary, commission, professional fees, interest, rent, etc. Due to [&...

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Do you have to file your ITR?

Many salaried as well as retired individuals are under the impression that as tax has been deducted from their income; they do not have to file their ITR. Filing of an ITR is a distinct and different responsibility from payment of taxes on your income and both have to be discharged separately. So in order […]...

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Save income tax via medical expenditures under Section 80DDB

Section 80DDB Section 80DDB of the Income Tax Act allows you to save tax by claiming medical expenditures incurred as a deduction from income before levy of tax. You can claim this deduction if these two conditions are satisfied then one can claim a maximum deduction of Rs 50,000 in a financial year for the […]...

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Constitution – When Does A Tax Liability Arise? Analysis of Various Ratios Lay Down by Apex Court

When Does A Tax Liability Accrue? Article 265 of the Constitution of India provides that no tax shall be levied or collected except by the authority of law. Such tax does not depend upon an assessment to be made by the assessing officer. Section 4 of the Indian Income Tax Act, 1961, which is the charging section, charges tax on income at ...

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Set-off & carry-forward of losses under Income-Tax Act, 1961

The Income-Tax Act, 1961, allows set-off and carry-forward of the loss incurred by any assessee subject to some restrictions Apart from other information, the new income-tax forms, ITR-1 to ITR-8, notified by the Central government seeks details on set-off of losses. Now almost every assessee has to give this information. Therefore, one h...

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Conundrum on Merger between Company and LLP

The concept of LLP in India was introduced off late in 2008 by enacting the LLP Act, 2008 thereby allowing businesses to be registered as a new and hybrid structure. It was anticipated at that time that many corporate houses would consider LLP as a vehicle to run their business operations, mainly due to lower […]...

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Income Tax Due date chart post Recent due date extensions

With the COVID-19 pandemic playing havoc and resulting in many practical challenges, the Indian Government has come out with various relief measures and also extended different statutory deadlines. Recently, the Finance Ministry via Press Release and as per Notification No. 88/2020 issued by CBDT dated 29 October 2020 announced further ex...

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Residential Status of Individual And Rate of Income Tax

RESIDENTIAL STATUS OF INDIVIDUAL AND INCOME TAX RATE OF INDIVIDUAL. RESIDENTIAL STATUS OF INDIVIDUAL The Residential Status of a Individual / HUF earning income is very much relevant for determining the tax liability of such income in his/her hands. Taxability of any Income depends on the two things, i.e. Residential Status of Individual ...

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TDS on Sale of Immovable Property – Section 194IA

As per Finance Bill of 2013, TDS is applicable on sale of immovable property wherein the sale consideration of the property exceeds or is equal to Rs. 50,00,000 (Rupees Fifty Lakhs). Section-194IA of the Income Tax Act, 1961 states that for all transactions with effect from June 1, 2013, Tax @ 1% or (  0.75% […]...

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Opting for lower rate of tax under Section 115BAB & getting covered under Transfer Pricing Audit

Opting for lower rate of tax under section 115BAB and getting covered under the Transfer Pricing Audit – Whether exercising the option worth the pain for compliances? 1. Background: Section 115BAB of the Income Tax Act, 1961 (hereinafter “the Act”) is applicable to a “new domestic manufacturing company” which is set up or re...

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Interpretation of double tax avoidance agreements

The Central Government has signed with several countries, including the U.S. "Agreements for the Avoidance of Double Taxation". By this, I am given to understand that in the case of an Indian who is a perm anent resident in the U.S. (green card holder) but who may have taxable income in India, as also in the U.S., double taxation is sough...

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e-TAX Payment of Taxes – Frequently Asked Questions

1. What is e-tax payment? Ans. This is a facility provided to the taxpayers to make income tax payments through internet using net-banking facility. 2. Can I use this facility to pay income tax? Ans. You can, if; a) You have a bank account with net-banking facility, and b) Your bank is amongst the banks that provide the e-tax payment fac...

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Introduction to U.S. Tax Returns

Just as we have different tax return forms for different purposes, The United States of America is no exception. U.S. also prescribes different types of tax returns for different purposes. The tax returns are differentiated on the basis of the income on which one is liable to pay taxes. This is similar to filing of […]...

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Taxation of shares & other securities under Income Tax Act, 1961

Taxing the Profit from shares are always debateable issue, however CBDT issue circular No. 06/2016 dated 29/02/2016 wherein it provides option to taxpayer that to tax profit as Business Income or Capital Gain. This circular applicable for profit from listed shares only and option once exercised assesse will not allow to change his/her sta...

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Whether amended section 115BBE of Income Tax Act applicable retrospectively or prospectively ?

Present article demonstrate the section 115BBE of Income Tax Act, 1961 which amended from time to time and the relevant case laws of the applicability of amendment prospectively. ...

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Income Tax Assessment of Private Trusts (Section 161 to 164)

Trusts have not been defined under the Income-tax Act 1961. The Dictionary meaning of ‘Trust’, in so far as it relates to the realm of law,  is ‘an arrangement’ by which property is handed over to or vested in a person, to use and dispose it off for the benefit of another person.’ Trust can […]...

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Determination of Residential status of Foreign Citizen in India as per Income Tax Act

Determination of Residential status of Foreign Citizen in India as per Income Tax Act Step 1: First of all we have to identify whether the person is Resident Indian or Non- Resident Indian: An individual shall be treated as Resident in India if he satisfies any one of the below mentioned conditions: a) If, he/she […]...

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FAQs of GSTR-10 Offline Utility

Q.1 Can I file the complete Form GSTR-10 offline using Offline Utility? Ans. No. Filing of Form GSTR-10 can take place only online on the GST Portal. Using Offline Utility, you will be able to prepare details of Table 8A, 8B & 8C and Table 8D in the GSTR-10 Return only. Once you have uploaded […]...

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New Tax Rates for Companies in brief

TAX RATES APPLICABLE FOR CERTAIN DOMESTIC COMPANIES (SECTION.115BAA) & FOR CERTAIN NEW MANUFACTURING COMPANIES (SECTION.115BAB) key changes to corporate tax rates in the income tax act, 1961: In Brief: > Existing domestic companies have been provided an option to pay tax at a concessional @22%, > New domestic companies set up on...

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Section 80E: Tax benefit for Interest on Loan taken for Higher Education

Section 80E- Deduction for Interest on Loan taken for Higher Education If you have taken a loan for higher studies (even though pursuing in abroad) and are repaying the same, then the interest paid on that education loan is allowed as deduction u/s 80E. However, the deduction is only available for the interest part of […]...

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Updated Due Date Chart of Income Tax Compliance

Due to COVID-19 pandemic and challenges faced by taxpayers, the Government has extended due dates for Filing of Income Tax Return For A.Y. 2020-21, Filing of Income Tax Return Assessment Year 2019-20, Fling of Tax Audit Report for AY 2020-21, Filing of Transfer Pricing Audit for AY 2020-21 and for Filing of Other Audit Reports […]...

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Significant Income Tax Benefits for Senior Citizens

Every individual who has annual income above the minimum exemption limit or has received any income on which tax was deducted at source (TDS), needs to file their Income Tax Return (ITR) every year. However, Income Tax Act pampers senior citizens and very senior citizens with several tax benefits. A person between 60 years and […]...

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New provisions of TCS w.e.f. 1.10.2020

New provisions of TCS on remittance abroad under LRS and on purchase of overseas tour programme package and on sale of goods w.e.f. 1.10.2020 As per newly inserted provisions by the Finance Act, 2020 TCS is to be collected u/s 206C(1G) on sale of foreign exchange by foreign exchange dealer an also by a seller […]...

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How filing of Income Tax Returns regularly & within time, can be beneficial?

Tax on incomes, earnings and gains is levied by the Income Tax Act, 1961 (‘Act’) in India and the same is enforced and administered by the Income Tax Department. Income tax is either collected directly from the taxpayer in the form of advance tax and self-assessment, or they are collected indirectly through the persons paying income o...

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Capital Gain on Land, Building or Both

CAPITAL GAIN (LAND & BUILDING) Capital Assets [Section 2(14)] (a) Property of any kind held by assesse, whether or not connected with business or profession. (b) Any securities held by Foreign Institutional Investor (FII) which has invested in such securities as per SEBI regulations but does not include: 1. Any stock-in-trade [other t...

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Section 68 – Meaning of Satisfactory explanation with respect to unexplained income!

This article aims at highlighting the meaning of Satisfactory Explanation to Assessing Officers with respect to Section 68 of the Income Tax Act, 1961....

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Section 54EC – Exemption on Long Term Capital Gain

Sec-54 EC – Exemption on Long Term Capital Gain on investment of Specified Bond Provisions under section 54EC provide exemption capital gain arisen on transfer of Long Term Capital Assets (whether land or building or both) when the amount is invested in specified bonds. This article discusses provisions of Sec 54EC of the Income Tax...

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Some special things related to Tax Audit

1. Tax Audit is mandatory if ‘business’ is having total sales, turnover or gross receipts more than Rs. 1 crore in any Previous Year (‘PY’). [Read clause (a) of Section 44AB of the Income Tax Act, 1961 (‘the IT Act’)]. 2. However, the aforesaid limit of Rs. 1 crore shall be read as 5 crores […]...

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Analysis of claim of Additional Depreciation

Like most other laws tax law is also an ever evolving subject. Tax laws, every now and then result into difference of opinion between the revenue authorities and tax payers on various issues. Indian Income-tax law has many such issues one of which is benefit of Additional Depreciation....

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Section 44AB vs Section 44AD

Section 44AD versus Section 44AB: What to choose ? As per recent amendments in Finance Act, 2020 where one of major amendment was made in Section 44AB by inserting a proviso to clause (a), which reads as follows:- Audit of accounts of certain persons carrying on business or profession. 44AB. Every person,— (a)  carrying on […]...

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