Black money window: CBDT issues notification to ensure secrecy

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CBDT today issued a notification making it clear that information about those who declare their black money under the compliance window, ending September 30, will be kept secret.

The notification states that “no public servant shall produce before any person or authority any such document or record or any information or computerised data or part thereof as comes into his possession during the discharge of official duties in respect of valid declaration under the Income Declaration Scheme, 2016.”

The notification also quotes provisions of section 138 of the Income Tax Act which states that taxpayer related information is confidential and cannot be shared.

The fresh notification was issued by the Central Board of Direct Taxes (CBDT), a senior official said, as the department was getting a number of queries with regard to the confidentiality under the Income Declaration Scheme (IDS) or the one-time domestic black money compliance window.

Trade associations and industry bodies had also taken up the issue during their meeting with Finance Minister Arun Jaitley recently.

“The notification now gives legal sanctity to the word of the government that all information related to IDS will be kept confidential. It is aimed to end apprehensions in the minds of potential declarants that their information will find its way in the hands of other probe agencies or will reach the public domain,” the official said.

The IDS is open for four months, between June 1 and September 30 and the CBDT and the IT department have introduced a number of measures to make it a success.

CBDT has so far issued three sets of clarifications on Frequently Asked Questions (FAQs) to clear doubts and answer queries about the IDS.

The department has also published a country-wide list of registered asset valuers for those who wish to declare their untaxed funds and properties under this window.

The CBDT has also directed the taxman to step up publicity by advertising about the IDS at posh markets, clubs and showrooms. Besides, it has promised full privacy would be ensured for those making disclosures for better collections.

Under the scheme, the declarants will have to pay a total of 45 per cent in tax and penalty by November this year. Individuals and entities making disclosures will have immunity from prosecution.

IDS was announced with an aim to flush out black money from the domestic economy. It will apply to undisclosed income whether in the form of investment in assets or otherwise, pertaining to financial year 2015-16 or earlier.

Declarations under IDS can either be made online on the official e-filing website of the tax department or before various regional Principal Commissioners of I-T department.

Source : http://economictimes.indiatimes.com/articleshow/53155906.cms

As income-tax returns filing date nears, 7 documents to be kept ready

by | posted in: Corporate Updates, Income Tax,e-Filing- Individuals, Firms, Companies | 0

The income-tax returns filing season is fast approaching with the initial deadline being July 31. 

The income-tax returns filing season is fast approaching with the initial deadline being July 31. You must be among those preparing to file your returns. But most tax assessees who are required to e-file their returns keep deferring till the last moment.

 

However, even if you are procrastinating, you need to be prepared with all the details that you need to provide in your tax returns. And for that you need a lot of documents to be with you. It may not easy to source these documents at the last moment since some have to obtained from your office, some come by mail and others need to be downloaded. And even if you have all of documents with you, you need to have them filed in a file that is easy to locate.

 

So what are these documents that you need to keep handy at the time of filing? FeMoney asked tax expert Sudhir Kaushik, Co-founder and CFO, Taxspanner.com on documents that are a must in hand. “Keeping documents like Form 16, Form 26AS and home or education loan certificates for obtaining deductions would ensure that your tax filing is hassle-free and complete,” Kaushik said.

 

Here are a list of documents that Kaushik says one should be ready with while filing tax returns:

 

Form-16 and Form-16A

Form-16 is the most basic source of information about the income earned and the tax deducted from your salary during the year. In case you have worked for more than one employer during the financial year 2015-16 then you must collect your Form 16 from all of them. Form 16-A form is also called a Tax Deducted at Source (TDS) certificate and is issued by banks for interest income, capital gains of NRIs, etc. If you have rental income and your landlord has deducted TDS on rent then you should collect Form-16A from the landlord too. Similarly, if you have any commission or professional income, TDS certificate for the same should also be collected.

 

Form-26AS

Your income from all sources, tax deductions and any high-value transaction(s) are reported in this form. I-T department sends notices if the ITR filed by the taxpayer does not match with the information available in Form-26AS. You should get your Form 26AS and match details with your ITR before filing it. If there is some mismatch, you should fix those errors and then file your return. You can download Form-26AS from your net banking account, directly from income-tax department’s website.

 

Bank statements from all bank accounts

You should verify that all the bank transactions carried out during the financial year with respect to income earned, investments made, expenses etc. have been declared in the appropriate sections of your return. This would show dividend income or gifts received above Rs 50,000 on which tax needs to be paid.

 

Home/education loan interest certificates

If you have taken any home/education loan then collect their interest certificate from the lender to claim the right deduction.

 

Investment proofs not submitted to employer

It is possible that some of the investments made by you during the financial year have not been included in the Form-16 issued to you. For example, if you invested in tax-saving tools such as life insurance, Public Provident Fund after proof submission deadline set by your employer, proofs of these investments would not have been submitted to your employer. For such investments, you need to have the proofs for reference while preparing your return.

 

Share/mutual fund transaction statements

These are required to enter details like sale date, purchase date, quantity and amount for computing capital gains/loss.

 

Tax payment challan(s)

If you have paid advance tax and/or self assessment tax then you need to enter the details of the same in your return for accurate computation of tax liability.

Source: http://www.financialexpress.com/article/personal-finance/income-tax-returns-filing-date-july-31-nears-7-documents-to-be-kept-ready/277141/

SEBI to make it easier for fund managers to move to India

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To make it easier for the foreign fund managers keen to relocate to India, markets regulator SEBI is considering allowing them to function as ‘Portfolio Managers’ under an easier regulatory regime.

The move assumes significance in the wake of the government already having announced taxation incentives for the offshore fund managers willing to relocate to India.

A new section in the Income Tax Act provides that the fund management activity carried out through an Eligible Fund Manager (EFM) located in India and acting on behalf of an Eligible Investment Fund (EIF) would not constitute business connection in India of such a fund.

Following the issuance of notification by the tax department in this regard, SEBI held meetings with various stakeholders to discuss the registration framework for EFMs, during which several impediments were pointed out in the existing regulations for Investment Advisers and Portfolio Managers.

Subsequently, SEBI has decided to initiate a consultation process for changes to its norms for Portfolio Managers while putting in place a framework for allowing EFMs to act as Portfolio Managers to their EIFs.

A proposal in this regard would be put up for approval of SEBI’s board next week, a senior official said.

Among the proposed measures, an existing SEBI-registered Portfolio Manager will also be allowed to act as EFM with prior intimation from SEBI and subject to certain conditions.

SEBI also plans to put in place a procedure for registration of an existing foreign-based fund manager desirous of relocating to India, or as a fresh applicant.

Such applicants will be granted registration as Portfolio Managers to act as an EFM, provided they meet existing eligibility norms of being a body corporate, having net worth of Rs 2 crore, appointment of a Principal Officer and minimum two employees with requisite credentials.

The EFMs would be required to segregate the funds and securities of the EIFs from that of other clients, provide information to Sebi on a half-yearly basis, ensure compliance to the Prevention of Money Laundering Act and other regulations.

However, EFMs would be exempted from several provisions of the PMS Regulations with respect to the EIF, and would have to comply with the applicable regulatory and disclosure requirements of the jurisdiction of the EIF.

Source: http://economictimes.indiatimes.com/articleshow/52640330.cms

Filing tax returns on time has benefits

by | posted in: Corporate & Business Advisory Services, Corporate Updates, Economy, Business Updates, Corporate Affairs, Income Tax,e-Filing- Individuals, Firms, Companies | 0

With the income tax department allowing ample time for filing returns, many taxpayers take it easy.

For the income earned in the past financial year (FY16), a taxpayer can file returns up to March 2018. However, sticking to the first deadline of July 31 has its benefits.

Say, you make a mistake while filing returns – it can be a wrong computation or incorrect bank account details.

If you file returns on time, the income tax (I-T) department will allow you to revise it as many times as you wish until the end of the assessment year.

In case of belated filing, the taxpayer loses this advantage.

“Not being able to revise returns can lead to problems. For example, in case of wrong computation, the department can send a notice. Incorrect bank account details can delay refunds,” says Vikram Ramchand, founder, Makemyreturns.com.

Missing the first deadline also means that the taxpayer cannot carry forward certain losses.

The Income Tax Act allows individuals to carry forward losses under the ‘capital gains’ head and also business losses for professionals and businesspersons.

These can be adjusted against the future gains for up to eight years.

Due to the correction in stock market in the last financial year, many investors would have suffered a loss in their equity trade.

Filing returns on time can help them utilise these losses in the coming years.

“The only loss that’s allowed to be carry forward for latecomers is the loss from house property,” says Ramchand.

This is the deduction that a person gets on the interest portion of a home loan under Section 24.

Though the deduction can be claimed in the subsequent year, the total limit for deduction will remain Rs 2 lakh for first-time home buyers. In case of a house property that’s not self-occupied, the entire interest can be claimed as deduction.

For those filing belated returns, they will also need to shell out a penalty.

There will be a one per cent penalty every month under Section 234A on the liability if the return is not filed on time, according to Kuldip Kumar, partner and leader (personal tax) at PwC India.

Professionals and businesspersons will also need to pay one per cent penal interest per month under Section 234B, if 90 per cent of the tax is not paid by March 31.

If you don’t file returns at all, there are provisions in the I-T Act that say if the tax due is more than Rs 3,000, the taxpayer can be prosecuted and jailed.

Ramchand says that in his experience, he has also seen that those who file returns on time get faster refunds and their filing is processed quickly, too.

Last year, many taxpayers who filed before the deadline got refunds within a fortnight, according to Ramchand.

However, in case of belated filing, the processing and returns are both delayed – it can easily take six to eight months.

Also, those filing belated returns usually see that their refund amount is adjusted against some pending tax demand of the past, according to tax experts.

Although this is not a rule, tax experts say such cases of adjustments are higher for those filing belated returns.

PwC’s Kumar points out that in the recent Union Budget, the period of filing returns has been reduced from two years to one year.

Taxpayers will need to file returns before the end of the relevant assessment year.

This will apply from the next assessment year.

Therefore, it’s beneficial, one should start filing returns on time to avoid hassles later.

Read Source: Rediff.com

Income Tax return is not considered filed unless it’s e-verified

by | posted in: Corporate Updates, Income Tax,e-Filing- Individuals, Firms, Companies | 0

Several taxpayers diligently file their tax returns but forget to e-verify them.

They believe their return filing process is complete once return has been duly submitted to the income tax department.

 

Your income tax (I-T) return submission is not complete unless you’ve ticked off the e-verification with the following steps :

 

Step 1: You have e-filed your tax return

 

Step 2: You have e-verified the return

 

Step 3: Final return processing by the tax department i.e. refund is processed or intimation under Section 143(1) is received.

 

Taxpayers who do not verify end up with incomplete filings. A refund, if any, is not processed in such cases.

 

Returns can be verified either electronically or by sending the physical ITR-V to CPC, Bengaluru. ITR-V is a one-page document, emailed by the I-T department to you; it can also be downloaded from the department’s website. ITR-V must be signed in blue ink and sent via ordinary or speed post to CPC, Bengaluru. You cannot courier the ITR-V. Sending the physical ITR-V involved a lot of problems. With the introduction of electronic verification, your return can now be verified easily and quickly.

 

There are several ways to verify your tax returns. To begin, log in to your e-filing account with your PAN and date of birth. Click on ‘e-File’ from the blue top bar. There is an option under it, ‘e-Verify Return’; select it. Select one of the options listed to e-verify.

 

EVC sent to registered email ID and mobile number

 

This option is available to taxpayers who have a total income of less than R5 lakh and there is no refund. A 10-digit alphanumeric code is sent to their email id and mobile number, registered on the tax department website, which is valid for 72 hours.

 

EVC via Aadhaar OTP

 

If you don’t have a refund, you can also e-verify via an Aadhaar OTP. Your Aadhaar card must be linked to your PAN on the e-filing website. The OTP is sent to your mobile number registered with Aadhaar and is valid for 10 minutes.

 

EVC through net banking

 

Those with an income of over R5 lakh, or with a refund, have to use net banking to e-verify returns. If your bank is authorised, you’ll be able to log in to e-filing through net banking. First, log in to your bank account and look for the e-filing option. When you confirm to e-verify, an EVC will be automatically generated and applied to the return; your e-verification will be complete. Don’t assume the refund will be credited to the net banking account you have used to e-verify. It is credited to the account selected for refund in your tax return, which may be different from the account you used to e-verify.

 

EVC through bank account number

 

You can also verify your tax return through your bank account number by logging in to the income tax department website. Your bank account number must be pre-validated. To validate, you have to select your bank name, enter the bank account number, IFSC and mobile number, and validate it on the income tax department website.

 

The department has issued a circular giving a final chance to taxpayers to put their past tax returns in order. If you had submitted your tax return for the past six years from AY 2009-10 to AY 2014-15, but the return could not be processed for want of ITR-V, you can e-verify it by August 31, 2016. The department shall process such returns by November 30. This will help put your past records in order.