In line with the announcements made in the Union Budget 2021, CBDT brought new functionality for compliance checks which mandated that non-filers of income tax returns for past two fiscal years would be subjected to higher tax deducted at source (TDS) and tax collected at source (TCS) rate if such tax deduction was Rs 50,000 or more in each of those two years.
In this regard, the Central Board of Direct Taxes (CBDT) issued a circular on Monday on implementation of Sections 206AB and 206CCA which provides for the higher rate of TDS and TCS respectively for the deductee who do not file their Income Tax Returns for the both of the two assessment years relevant to the two previous years which are immediately before the previous year in which tax is required to be deducted or collected.
“The income tax department has developed a new utility to help TDS deductors and TCS collectors identify the ‘specified persons’ on whom the higher rate of taxes will be levied from July 1, which would ease the compliance burden of tax deductors/collectors,” the I-T department said. Through the functionality, the TDS deductor or TCS collector can feed PAN of the deductee or collectee on the functionality and get to know whether the deductee or collectee is a ‘specified person, the CBDT said.
With respect to higher tax deduction for certain non-filers TDS will be higher of the following:
– Twice the rate specified in the relevant provision of the Income-tax Act; or
– Twice the rate or rates in force; or
– The rate of 5%.
The aggregate amount of TDS / TCS of Rs 50,000 in a year is not limited to TDS only on dividend income received by the shareholder but will include all TDS transactions of the shareholder during the relevant financial year. These provisions will be effective from July 01, 2021.
No comments:
Post a Comment