TAX GRIP

What is Virtual Digital Asset? Section 2(47A)-The definition of Virtual Digital Assets proposed to be inserted vide new clause 47A to the section 2 of the Act, where Virtual Digital Assets are defined to cover assets with the following features: i)          Any information, code, number or token (not being Indian currency or foreign currency) ii)       Generated through cryptographic means or otherwise, by whatever name called, iii)   Providing a digital representation of value exchanged with or without consideration, iv)       With the promise or representation of having inherent value, or functions as a store of value or a unit of account including its use in any financial transaction or investment, but not limited to investment scheme, v)                And can be transferred, stored or traded electronically.   Further, Non fungible token (NFTs) and; any other token of similar nat...

New Form ITR-U Under Section 139(8A) for updated Income Tax Returns   The CBDT has notified a new form for filing updated Income Tax returns in which taxpayers will have to give the exact reason for filing it along with the amount of income to be offered to tax. Commence from which Financial Year: The return has to be filed Under Section 139(8A) relating to the Assessment Year commencing from 01.04.2020 and subsequent assessment years. The new form (ITR-U) will be available to taxpayers for filing updated income tax returns from the Financial Year 2019-20. Eligibility of filing ITR-U: Taxpayers filing ITR-U, which can be filed within 2 years of the end of the relevant assessment year, will have to give reasons for updating the income – v      v return previously not filed, or v      v income not reported correctly, or v      v wrong heads of income chosen, or v      v reduction of carried forward loss, ...

ANNUAL INFORMATION STATEMENT The Income Tax Department has initiated the new Annual Information Statement(AIS) on the online portal which shows the taxpayers a facility that captures online feedback. The facility can be accessed by visiting the online portal link of the Annual Information Statement (AIS) under the Services tab on the tax e-filing portal, i.e. https://www.incometax.gov.in. Form 26AS will be displayed on the TRACES portal which will parallel function to the time the new AIS is completely operational. The new AIS related to interest, dividends, securities, transactions, mutual fund transactions, foreign remittance information. The information is processed to eradicate duplicity of information. The taxpayers can download the information in PDF, JSON, and CSV formats. Here is the list of related information to be known about the new Annual Information Statement: If the taxpayer examines whether the information provided is incorrect and is related to t...

Ministry of Finance      CBDT extends due dates for filing of Income Tax Returns and various reports of audit for Assessment Year 2021-22. Posted On: 09 SEP 2021 7:24PM by PIB Delhi  On consideration of difficulties reported by the taxpayers and other stakeholders in filing of Income Tax Returns and various reports of audit for the Assessment Year 2021-22 under the Income-tax Act, 1961(the “Act”), 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 details are as under:  1. 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 vide Circular No.9/2021 dated 20.05.2021, is hereby further extended to 31st December, 2021; 2.The due date of furnishing of Report of Audit under any provision of the Act for t...

  Income tax updates for   July 2021 1.Processing of returns with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases-regd. Order under section 119 of the Income-tax Act. 1961. Central Board of Direct Taxes notices that due to certain technical issues or for other reasons not attributable to the assessees concerned, several returns for various assessment years up to the assessment year 2017-18 which were otherwise filed validly under section 139 or 142 or 119 of the Income-tax Act, 1961 ('Act') could not be processed under sub-section (I) of section 143 of the Act. The taxpayer is unable to get his legitimate refund. To resolve the grievances the earlier order dated 10th July 2020, time frame was given till 31.10.2020 to process such returns with refund claims. To mitigate genuine hardship being faced by the taxpayers on this issue, Board, by virtue of its powers under section 119 of the Act, hereby relaxes...

  Income Tax benefits on Home Loan   Deduction on Home Loan A home loan should be taken by an individual for purchase or construction of house property and the construction of the house property should be completed within 5 years from the date of availing loan. The EMI comprises of Ø Principal Amount Ø Interest on Home loan Deduction Under Section 80 C-Principal Amount Under this section, an individual is entitled to tax deductions on the amount paid as repayment of the principal component on the housing loan. An amount up to Rs.1.50 lakh can be claimed as tax deductions under Section 80C. However, the tax benefit on the repayment of the principal amount can be claimed only after the house is constructed. The section does not allow deductions for the repayment of the principal part during the years the house was being constructed. Deduction Under Section 24-Interest paid on Home Loan Under Section 24 of the Income Tax Act, an individual can claim...

Section 206 AB and 206 CCA: Higher TDS /TCS for Not Filing of Income Tax Return   Finance Act, 2021 inserted two new sections 206AB and 206CCA in the Income-tax Act 1961 which takes effect from 1st day of July, 2021.The section mandates to deduct a higher rate of TDS of the payees who have defaulted in filing of Income Tax return for the last 2 preceding years. Similarly, Section 206CCA for TCS is inserted. The main objective is to ensure that taxpayer do not fail to file their income tax return. Section 206AB: This section provides a tax deduction at source (TDS) at rates higher than those prescribed in the Act while making payments or collections to those who have not filed their income tax return. Section 206CCA : This section provides a collection of tax at source (TCS) on amounts received from the buyers at rates higher than specified in the Act. Applicability: This section is applicable where tax is required to be deducted at source for those transaction ...