Expect a visit from taxman if you’ve ignored I-T dept’s email

Income Tax officials could soon be at your doorstep if you have deposited a huge amount during the note-swapping exercise last year, and have not yet explained the source of the cash. “We have tried to keep the exercise non-intrusive. But if people have not come forward, then some kind of verification is needed especially in cases that involve deposits of large sums,” a senior income-tax department official told ET.

Under the ‘Operation Clean Money’, the I-T department had sent out SMSes and e-mails to about 18 lakh people who deposited over Rs 5 lakh each during the 50-day window from November 10 to December 30, because the desposits did not tally with their income.

The depositors were asked by the I-T department to explain the source of the money by logging in to its portal. By February 15, about 7.3 lakh people responded to the emails and explained their deposits.

According to the official, the department is now contemplating issuing notices or carrying out surveys in cases where no response has come or the replies are unsatisfactory.

“In cases where responses are not satisfactory, notices would be issued. In some cases where big sums are involved and response is not satisfactory, surveys could be carried out,” the official said, adding that people could be also asked to come to income-tax offices or tax officers may pay them a visit.

People with unexplained deposits during the demonetisation period have the opportunity to avail the Pradhan Mantri Garib Kalyan Yojana (PMGKY) by paying 50 per cent tax and depositing 25 per cent in non-interest bearing scheme for four years.

Incidentally, the I-T department is soon expected to send out the next batch of emails and SMSes, beginning the part two of the ‘Operation Clean Money’, which will target suspicious deposits below Rs 5 lakh identified through data analytics.

The department is examining the voluminous data received from banks on deposits made during the 50-day period. It is also hiring external experts to work on the data to identify splitting of deposits or use of other means to evade notice.

Source:  http://economictimes.indiatimes.com/articleshow/57261518.cms

 

I-T refunds rise by a whopping 41.5%, government issues 1.62 cr refunds worth Rs 1.42 lakh cr

The income tax department has issued refunds to the tune of Rs 1.42 lakh crore so far this fiscal till February 10, 41.5 per cent higher than last year’s.

The income tax department has issued refunds to the tune of Rs 1.42 lakh crore so far this fiscal till February 10, 41.5 per cent higher than last year’s. The Centralised Processing Centre (CPC) of the tax department has already processed over 4.19 crore income tax returns (ITRs) and issued over 1.62 crore refunds during the current financial year up to February 10, 2017.

“The amount of refunds issued at Rs 1.42 lakh crore is 41.5 per cent higher than the corresponding period last year,” an official statement said. As much as 92 per cent of the refunds issued are below Rs 50,000 due to the high priority given to expeditious issue of refunds to small taxpayers.

Only 2 per cent of refunds less than Rs 50,000 remain to be issued. A majority of these cases relate to recently-filed ITRs or where the taxpayer’s response to the department is awaited.

The department also advised taxpayers to verify and update their e-mail address and mobile number on the e-filing portal to receive electronic communication.

“CBDT is committed to ensuring best possible taxpayer services through its e-governance programmes and increasing the coverage and scope of electronic filing and processing of various forms and applications,” the statement said.

As a result of emphasis on expeditious issue of refunds, 92 per cent of all I-T returns were processed within 60 days, demonstrating the Central Board of Direct Taxes’ (CBDT) commitment to faster and more efficient taxpayer service.

As many as 4.01 crore ITRs were e-filed till February 10, 2017, an increase of 20 per cent over the previous year.

Also, more than 60 lakh other online forms were filed with an increase of nearly 41 per cent compared with the previous year.

In April-January, the total direct tax collection grew 10.79 per cent to Rs 5.82 lakh crore led by robust collections in personal income tax.

Operation Clean Money: I-T dept scans 1 crore accounts, 18 lakh people to be questioned

In a bid to clamp down on unaccounted money funnelled into bank accounts post demonetization, the tax department has scrutinised and matched as many as 1-crore accounts and asked 18 lakh people to explain the source of fund.

The tax department has run big data analytics through more than 1-crore accounts in its data bank and done matching with the taxpayer profile of the holder, a top source said.

As per I-T records, there are 3.65 crore individuals who filed income tax returns. Besides, there are over 7 lakh companies, 9.40 lakh Hindu Undivided Families (HUFs) and 9.18 lakh firms who filed ITRs during Assessment Year 2014-15.

Also, over 25 crore zero-balance Jan Dhan accounts were opened as part of the financial inclusion drive.

Sources said I-T department is scrutinising all categories of accounts and will send out more SMS/emails for suspicious deposits under ‘Operation Clean Money’.

“We have initially matched 1-crore accounts with the profile in our database and identified 18 lakh people with suspicious deposits of over Rs 5 lakh. We will expand the scope of data analytics further and match the profiles with our data base,” the source told.

In order to reduce harassment of taxpayers, the revenue department has mandated only officers in the rank of Assistant Commissioners and above to issue notices in case of unsatisfactory response received about bank deposits post demonetisation.

Under Operation Clean Money launched by the Income Tax department on January 31, the department has sent SMS and emails to 18 lakh people who have made suspicious deposits of Rs 5 lakh and above between November 10 and December 30.

“If the department is convinced with the reply of the assessee, the case will be closed and that will be communicated by SMS and email. But, in case of unsatisfactory reply, the decision to issue notice will be taken by Assistant Commissioner and Commissioner rank officers,” the source said.

The department has used data analytics for comparison of deposits made after the November 8 decision to scrap high-value banknotes with information in its database to identify tax-payers whose cash transactions do not appear to be in line with the tax-paying profile.

It has also asked taxpayers to e-verify the deposits they made in their accounts post demonetisation and respond to queries of any mismatch on the tax e-filing portal.

The source further said people who have received queries from the tax department about their deposits while replying in the e-filing website can also offer their remarks if it was their cash in hand.

“If the cash in hand is as per the balance sheet, no questions will be asked and the case would be closed. We have put enough safeguard to ensure that there is no harassment to tax-payers,” the source added.

Company Incorporation in India made simpler and more versatile

MCA has taken another bold initiative in Government Process Re-engineering (GPR) and launched Simplified proforma for Incorporating Company Electronically (SPICe) e-Form.

Ministry of Corporate Affairs (MCA) has introduced a bold initiative in Company Incorporation so that registering a company and starting business, in India, is made simpler and speedier that your business can be started within the stipulated time frame, in line with international best practices.

 

MCA has launched SPICE (Simplified Proforma for Incorporating Company Electronically) w.e.f. 02.10.2016 for registering companies  in completely online form, vide Form INC-32.

 

This would be processed speedier as the e-MOA and e-AOA would have a faster review, by the approving authorities through the back office set up in this regard.

 

This would make setting up of business, in India, fairly simpler and more versatile, making way for “ease of doing business”.

The highlights of SPICE are:

  1. Simplified and completely Digital Form for Company Incorporation – Form INC-32
  1. Standard format of e-Memorandum of Association as per Companies Act, 2013 – Form INC 33
  1. Standard format of e-Articles of Association as per Companies Act, 2013 – Form INC 34
  1. Memorandum and Articles will now be filed as linked e-forms, except for Section 8  (not-for-profit companies)
  1. Provision to apply for Company Incorporation with a pre-approved Company Name vide INC -1, as well
  1. Mandatory DSCs of Subscribers and Witnesses in SPICe MOA and SPICe AOA 

7. Back Office productivity gains due to faster review of e-MOA and e-AOA by approving authorities.

As part of the initiative of ease of doing business in India, the Ministry of Corporate Affairs had earlier introduced e-filing of single Form INC-29 as alternative to INC 7, so that incorporating a company in India does not take too long a time. As further simplification of the process of registering companies, SPICE Form INC-32 is intended to make the whole process versatile for a new company to be registered on-line in India, under the Companies Act, 2013.

e-Filing of single Form INC-32

  • This form can be filed even after approval of name vide INC-1. This facility was not provided in INC-29.
  • Memorandum of Association (MOA) has been provided in Electronic Mode INC-33.
  • Article of Association (AOA) has been provided in Electronic Mode INC-34.
  • By new e-MOA & e-AOA, no need for physical signatures of Subscribers; Instead, Digital Signature Certificate (DSC) of Subscribers can be affixed on MOA & AOA.
  • By the new e-MOA & e-AOA, no need for physical signatures of Witness; Instead, Digital Signature Certificate (DSC) of Witness can be affixed on MOA & AOA.
  • Existing INC-29 and INC-7 will be phased out and SPICe will be the single, simplified versatile form to be filed on-line for incorporation of a company in India.

Read earlier posts:

Integrated e-Form INC-29 for Company Incorporation and Ease of doing business

Incorporation of Companies under Companies Act, 2013 – Procedure

Source: http://www.mca.gov.in/Ministry/pdf/SPICEPress%20Release_03102016.pdf

File income tax return (ITR) even if your income is not taxable

Many people think it an avoidable headache to file income tax returns, when their income falls below the taxable limit, or when tax is deducted at source or when no taxes are due. They also unnecessarily fear some notice will come from Income Tax Department every year, once they have started filing income tax return.

Here are the benefits of filing the income tax return that show you that it’s always better to file the return every year, even if your income  is not taxable.

  1. Helps as Standard Income Proof

In simple words, a tax return is a summary document or declaration about the results of all your financial transactions undertaken during the tax year. It consolidates the income under all sources and calculates the taxes due after allowing all eligible deductions.

ITR is considered and accepted by various agencies as a proof of your income, not only in India but also globally. If you are looking for higher education or employment abroad, ITR is the largely accepted income proof.

PAN – Permanent Account Number, issued by the Income Tax authority is not only a prerequisite for filing ITR but is also now mandatory for all financial transactions – from opening a bank account, or purchasing mutual funds to real estate for investment. So it makes sense to get yourself one and file the tax return.

  1. Helps Loan application:

At the time of applying for a home loan or vehicle loan or education loan, most banks ask the applicant to furnish copies of tax returns for the past 2-3 years. This helps banks understand your financial position and ability to repay the loan. Providing a copy of returns receipts helps in faster approval of your loan application

Apart from a good credit history (or past repayment track), the fact that you are filing your ITR regularly gives you speedier access to credit and at better terms, although not necessarily a larger line of credit, but surely a better rate.

It also provides the impression to the lender that you are a law abiding citizen and will repay the loan within time.

3. Helps claiming your tax refund:

Filing of ITR also helps your claiming of Tax Refund! In the case of salaried employees or those who have sold property, where Tax is deducted at source at standard rate, you can claim refund if the tax outgo has been more than the actual tax payable. You must file your tax returns if you wish to claim tax refunds. Not doing so would lead to forgoing the refund.

Generally, your employer deducts taxes on your estimated income based on the declaration that you have submitted. Apart from this, taxes are also deducted at source on various other incomes such as interest, commission, rent, and others, at a standard rate. When you club all these incomes with your salary, and also consider tax deductions as applicable to you, the final tax rate applicable may turn out to be different from the TDS rate. Owing to this you may either have to pay more tax or expect a refund.

Thus, filing ITR is not always about paying tax. It can be used as a means to reduce your tax liability!

  1. Helps Carry forward of losses:

Income tax laws allow you to carry forward and set off certain losses (losses from business income, depreciation, capital gains) against future gain or income. These losses can be carried forward for eight consecutive years immediately succeeding the year in which the loss is incurred. Even if you have taxable income this year, you might have losses to carry forward that can be adjusted against gains in later years when you actually have higher incomes.

  1. Visa processing:

If you are planning to immigrate to another country or explore an overseas job opportunity, then prepare yourself in advance. Most embassies and consulates require you to furnish copies of your tax returns for the past couple of years at the time of the visa application. This is especially applicable when applying for visa for the US, the UK, Canada or Europe.

  1. Helps in Statutory Compliance:

This also helps in statutory compliance, when you need to file tax returns.

The income tax department requires you to file a tax return in case your gross total income exceeds Rs.2.5 lakh (Rs.3 lakh for tax payers older than 60 years and Rs.5 lakh for those older than 80 years) in the financial year. Further, even if you do not have taxable income but if you qualify as a ‘resident’ individual and have any asset or financial interest in an entity located outside of India, then also it is mandatory for you to file.

What if you don’t file your taxes? If you are required to file your returns but miss it, then the tax officer may impose a penalty of up to Rs.5,000 (under section 271F). And if you owe some taxes and still don’t file it, then you may be liable to pay additional interest (section 234A), along with other penalties for avoiding taxes.

Govt allows Aadhaar e-KYC for new mobile connections

Forget the bulky paperwork, you can now apply, validate and activate new pre-paid and post-paid mobile connections using your Aadhaar card and fingerprint at the point of sale.

 

The government today issued e-KYC guidelines to make the online process of application and authentication faster and simpler for subscribers. In contrast to the existing document-based process, the move is intended to cut down time for SIM activation as KYC is verified instantly.

 

In e-KYC, a customer through her Aadhaar number and biometrics will online authorise UIDAI to provide demographic details such as name, address, date of birth and gender, along with the digitally-signed photograph, to the mobile operator.

 

“Digitally-signed electronic KYC data provided by UIDAI is machine readable, making it possible for licensees to directly store it as customer record in their database for the purpose of issuing a mobile connection,” a DoT notification said. COAI Director General Rajan Mathews felt that the move will be helpful for all stakeholders as it simplifies activation, eases verification process and enhances security.

 

“Earlier, the entire verification process would last 8-10 hours and it will now be greatly reduced,” he hoped. Bharti Airtel plans to start rolling out Aadhaar-based e-KYC solutions this week, MD and CEO (India and South Asia) Gopal Vittal said.

 

Vodafone India termed the e-KYC solution as “an instant, secure and green mobile subscriber verification project” and said all stakeholders will benefit from it. Customers will soon be able to walk in with their Aadhaar card in any of the Vodafone stores and walk out connected within minutes, the company statement read.

 

“For the consumer, instant activation means better experience and security of personal confidential information. For Vodafone, it will improve quality of sales as well as regulatory compliance. For the regulator, it not only means a green initiative, but hassle-free governance and accurate audit results,” said Sunil Sood, MD and CEO, Vodafone India.

 

According to Hemant Joshi, Partner, Deloitte Haskins & Sells, the move will bring down the cost of subscriber acquisition significantly as telecom companies will not have to spend on physical transportation of forms, verification, scanning and storage. “Also, it would help easier compliance and reduction in litigation on account of audit carried out by term cell,” Joshi said.

Source: http://www.moneycontrol.com/news/business/govt-allows-aadhaar-e-kyc-for-new-mobile-connections_7288301.html

Over 75 lakh taxpayers availed e-verification facility for filing Income Tax Returns

Over 75 lakh taxpayers availed the e-verification facility of their income tax returns filed till August 5 against around 33 lakh taxpayers last year till September 7, which will ensure faster processing of their returns. In all 226.98 lakh e-returns were filed in FY 2016-17 as compared to 70.97 lakh for the same period in FY 2015-16. The number is higher because last year the date of filing had been extended to September 7.

By September 7, 2015 nearly 207 lakh returns had been filed, which yields 9.8% rise in e-filing this year. Aadhaar based e-verification was used by 17.68 lakh taxpayers during the current year as against 10.41 lakh taxpayers during the same period in 2015-16, finance ministry said in a statement.

“In addition to these, 3.32 lakh returns were digitally signed. Thus, over 35% of taxpayers have already completed the entire process of return submission electronically,” it added. The forms that are not electronically verified have to be physically mailed to processing centre in Bengaluru before they can be processed.

The revenue department is encouraging all taxpayers who have submitted their returns to e-verify them as an easy alternative to sending their ITR-V form to CPC, Bengaluru.

The government said tax refunds of Rs 14,332 crore have been issued this year till August 5. “The Central Processing Centre (CPC) Bengaluru has already issued over 54.35 lakh refunds totaling to Rs 14,332 crore have been issued this year till August 5. “The Central Processing Centre (CPC) Bengaluru has already issued over 54.35 lakh refunds totaling to Rs 14,332 crore which includes 20.81 lakh refunds for AY 2016-17 (current year returns) totaling to Rs 2,922 crore till August 5, 2016,” the statement said.

Source: http://economictimes.indiatimes.com/articleshow/53607133.cms