GST refund drive extended till June 16

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Relief for exporters as govt extends special GST refund drive till June 16

The Central Board of Indirect Taxes and Customs (CBIC) has extended the refund fortnight for fast track clearance of pending dues to exporters by two days till June 16.

The central and state tax officials have already cleared refunds worth over Rs 7,500 crore since May 31, when the special drive to clear exporters refund was launched.

“In view of overwhelming response from exporters and pending claims, the period of refund fortnight is being extended by two more days i.e up to June 16, 2018,” a finance ministry statement said.

With about Rs 14,000 crore of exporters refunds stuck due to various mismatches, the CBIC had organised the second phase of the special fortnight to fast track clearances.During the first phase, between March 15 and 29, an amount of Rs 5,350 crore was sanctioned.

The ministry further said, in case of short payment of integrated GST (IGST), small exporters whose aggregate IGST refund amount for the period July 2017 to March 2018 is up to Rs 10 lakhs are required to submit self-certified copies of proof of payment of IGST to the concerned customs office at the port of export.

Others are required to submit a certificate from a Chartered Accountant including the proof of payment.

All GST refund claimants, whose claims are still pending, are being encouraged to approach their jurisdictional tax authority for disposal of their refund claims submitted on or before April 30, the statement said.

“In case of any problem, exporters are advised to approach the Commissioner of Customs /Jurisdictional Tax Authorities. The government is committed to clear all the remaining refund claims filed up to 30.04.2018 are still pending,” it added.

GST monthly revenue touches Rs 1 lakh crore for first time; govt credits better compliance

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The government announced today that the GST revenue for the month of April has crossed Rs 1 lakh crore – a first since GST was rolled out in July last year. As mentioned by the Ministry of Finance, the total gross GST revenue collected in April is Rs 1,03,458 crore.

Out of that CGST (Central GST) amounted to Rs 18,652 crore, while SGST (State GST) amounted to Rs 25,704 crore. IGST (Integrated GST) stood at Rs 50,548 crore, including Rs 21,246 crore that was collected on imports, and cess at Rs 8,554 crore, including Rs 702 crore collected on imports.

As mentioned in ANI, the finance ministry also noted that the central and state governments earned a total revenue of Rs 32,493 crore in CGST and Rs 40,257 in SGST, after settlement in April.

Moreover, the ministry noted that out of 87.12 lakh, 60.47 lakh GSTR 3B returns were filed for March till April 30. That makes 69.5% of the eligible proportion. The ministry also said that 11.47 lakh out of 19.31 lakh composition dealers filed their quarterly return (GSTR 4), amounting to 59.40%. In total Rs 579 crore in taxes were paid, which is included in the aforementioned GST revenue figure.

The ministry said, “The buoyancy in the tax revenue of GST reflects the upswing in the economy and better compliance. However, it is usually noticed that in the last month of the financial year, people also try to pay arrears of some of the previous months. Therefore, this month’s revenue cannot be taken as a trend for the future.”

The recently introduced e-way bill might be the reason behind the sudden spike in GST revenues. E-way bill, which is generated for consignments moving inter-state or intra-state was rolled out in April. The inter-state e-way bill was introduced in April 1, while the intra-state one was pushed to April 15.

The GST Council is scheduled to meet on May 4 next.

Source: Business Today

CBEC to verify GST transitional credit claims of 50,000 taxpayers

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In order to check “frivolous and fraudulent” tax credit claims by businesses, the CBEC has decided to verify demands of top 50,000 tax payers claiming maximum GST transitional credit, starting with those where the quantum exceeds Rs 25 lakh.

The verification of “unreasonable” transitional credit claims would be conducted in four phases, a source said, adding that credit verification will remain one of the focus areas in 2018-19.

As part of transition to GST last July, taxpayers were allowed to file Form TRAN-1 and avail tax credit on the basis of closing balance of the credit declared in the last return under the pre-Goods and Services Tax regime.

In order to check “frivolous and fraudulent” transitional credit claims, the CBEC has shared with field offices the list of 50,000 taxpayers whose claims would be further scrutinised.

It is suspected that some of these businesses might have obtained a registration under the GST only to claim transitional credit benefits, the source added.

In the first phase, the tax officers will verify transitional credit claims where the growth is more than 25 per cent or the credit availed is in excess of Rs 25 lakh. This verification is to be completed by June and a status report has to be given to the Central Board of Excise and Customs (CBEC) by July 10.

One-third of the remaining claims of 50,000 taxpayers will be verified in three phases — July-September, October-December and January-March (2019).

Taxpayers who have claimed transitional tax credit of more than Rs 25 lakh and have reported 25 per cent increase in such claims are also likely to be asked to submit a detailed statement of purchases during October 1, 2016, to June 30, 2017, the source said.

According to revenue department data, as much as Rs 65,000 crore of transitional input tax credit was claimed by businesses as on September 2017.

Concerned over large claims for which there was no “bona-fide explanation”, the revenue department had asked taxpayers to revise their claim forms by December 27, 2017, or face enforcement action.

Worried over huge claims, the CBEC conducted a “preliminary scrutiny” following which it has now decided to further verify the “correctness of the transitional credit in a more focused and concerted manner”, the source said.

However, in a communication to the field formation, the CBEC said that efforts should be made on the basis of data already available with the department without contacting the taxpayer.

It further said wherever contact with taxpayers is absolutely essential, it should be done with due caution.

“Summon should be issued only where the taxpayer is not sharing information even after repeated requests and lapse of an unreasonable period of time,” it said.

AMRG & Associated Partner Rajat Mohan said the move comes amid disappointing tax collections.

“A detailed verification of transitional credit for pre-decided 50,000 GSTIN on all India basis comes as a no surprise. Credit verification would be a focus area in the new financial year, and big data analytics would be of great aid,” Mohan said.

As per a finance ministry reply to the Lok Sabha, GST mop up was Rs 93,590 crore in July, Rs 93,029 crore in August, Rs 95,132 crore in September and Rs 85,931 crore in October.

The collections in November stood at Rs 83,716 crore, December (Rs 88,929 crore) and January (Rs 88,047 crore).

Source:  Times of India

Income Tax Return filing deadline: Waiver on LTCG Tax to end on 31 March

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Tax liability on long term capital gains (LTCG) at the rate of 10% will accrue only when the shares or mutual funds are sold after April 1, 2018.

In the Budget 2018, Union Finance Minister Arun Jaitley had introduced long term capital gains (LTCG) on sale of equity and mutual funds, which will be taxed from April 1 onwards. One must remember that any capital gains arising out of sale of shares in this financial year (2017-18), which means prior to March 31 this year, will not attract any long term capital gains tax.

Seven Things To Know About Tax On LTCG Arising On Equity/ Mutual Funds Sale

1. Tax liability on long term capital gains (LTCG) at the rate of 10% will be charged only when the shares or mutual funds are sold after April 1, 2018.

2. The tax liability will not arise if the shares or mutual funds are sold, at whatever premium, before the beginning of April since the new legislation will come in force with effect from the next financial year, which is April 1.

3. For the tax on LTCG to get liable, there must be a difference of at least Rs. 1,00,000 between the cost of acquisition and the amount of sale.

4. The time period of one year will be calculated from the date of acquisition even if the time period falls in the previous financial year, which is 2017-18.

5. Any gains prior to January 31 are grandfathered. This means the capital gains will be zero if the sale price is more than the cost of acquisition but less than the value on March 31.

For instance, an equity share is acquired on January 1, 2017 at Rs. 100, its fair market value is Rs. 200 on January 31, 2018 and it is sold on April 1, 2018 at Rs. 150.

In this case, the actual cost of acquisition is less than the fair market value as on January 31, 2018. However, the sale value is also less than the fair market value as on 31st of January, 2018. Accordingly, the sale value of Rs. 150 will be taken as the cost of acquisition and the long-term capital gain will be NIL (Rs. 150 – Rs. 150).

6. The tax payer will stand to gain when the shares market price on January 31 was lower against the acquisition cost. Since the higher of two values is chosen (between the cost of acquisition and the price on January 31), the investor stands to gain. Sample this. An equity share is acquired on 1st of January, 2017 at Rs. 100, its fair market value is Rs. 50 on 31st of January, 2018 and it is sold on 1st of April, 2018 at Rs. 150.

In this case, the fair market value as on 31st of January, 2018 is less than the actual cost of acquisition, and therefore, the actual cost of Rs. 100 will be taken as actual cost of acquisition and the long-term capital gain will be Rs. 50 (Rs. 150 – Rs. 100).

7. When the selling price is lower than both cost of acquisition and price on January 31, then instead of the higher of the two values, one has to take the lower of two values for computing the capital gains. Sample this. An equity share is acquired on 1st of January, 2017 at Rs. 100, its fair market value is Rs. 200 on 31st of January, 2018 and it is sold on 1st of April, 2018 at Rs. 50. In this case, the actual cost of acquisition is less than the fair market value as on 31st January, 2018. The sale value is less than the fair market value as on 31st of January, 2018 and also the actual cost of acquisition. Therefore, the actual cost of Rs. 100 will be taken as the cost of acquisition in this case. Hence, the long-term capital loss will be Rs. 50 (Rs. 50 – Rs. 100) in this case.

 

Source: NDTV

Deadline for filing revised or belated income tax return for past 2 assessment years is March 31

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The date you actually need to focus on is March 31, because that is the last day to file revised and belated income tax returns (ITR) for assessment years (AY) 2016-17 and 2017-18, with interest, if any, for late filing. This is not to be confused with the deadline for filing taxes for the current financial year, which is on or before July 31. Last year this deadline was extended till August, but the gesture may not be repeated.

So if you are yet to file older ITRs, “there’s still time” to “come clean” as a recent advertisement put out by the income tax department reminds folks. The ad goes on to exhort companies, firms, LLPs, trusts, associations and political parties (whose income prior to claim of exemptions exceeds the minimum chargeable to tax) to file taxes. Similarly, individuals earning over Rs 2.5 lakh have to pay income tax while the exemption limit for senior citizens (aged 60-80 years) is Rs 3 lakh and that for very senior citizens (over 80 years) is Rs 5 lakh.

“If you have deposited large amounts of cash in your bank account or made high value transactions, please consider the same while filing income tax returns,” says the communication, adding that “Non-filing or incorrect filing of return of income may result in penalty and prosecution”. The easy way to do it is online, either by logging into the tax department’s e-filing website (incometaxindiaefiling.gov.in) or the likes of Cleartax.com and Taxspanner.com, which are far more user friendly. Keep in mind that failure to file returns for the AY 2017-18 by March 31 means no second chances.

Belated filing, of course, poses serious drawbacks. Not only do you lose the opportunity to avail of select exemptions and carry forward losses (other than house property loss) for the assessment years for which ITR were not filed, you may have to shell out extra as interest under section 234A, perhaps even sections 234B and 234C, which deal with advance tax. The latter is applicable on all individuals with a tax liability exceeds Rs 10,000 after your employer has deducted the TDS.

For any defaults in filing your ITR, according to Cleartax, “you will be charged an interest amount of 1% per month (simple interest) on the tax amount outstanding. This interest will be calculated from the due date applicable to you for filing of return of the applicable year till the date that you actually file your return.”

Here’s an example. Assume your total tax outstanding is Rs 1 lakh and you forgot to file your return. Your tax liability will calculated at 8% (8 months late till the end of the assessment year on March 31) of Rs 1 lakh, or Rs 8,000, over and above the tax amount that you are due to pay in any case.

That apart, “a penalty of Rs 5,000 shall be levied under section 271F”, says the FAQ on the income tax website. With effect from AY 2018-19, a new section 234F will come into play, under which the penalty for ITRs furnished on or before December 31 is Rs 5,000, but double that amount for later filings. However, penalty “shall be levied @ Rs 1,000 if total income does not exceed Rs 5,00,000” and if the tax evaded “exceeds Rs 25 lakh the punishment could be 6 months to 7 years” adds the website.

Also keep in mind that silly mistakes often creep in when one is trying to beat a deadline, like erroneously leaving a mandatory field empty or forgetting to report interest income. So make sure no discrepancies creep in while filing your returns, else you could be staring at a demand notice from the taxman, which means extra paperwork for you.

Thankfully, at least this headache will disappear from the next assessment year on. Earlier this month the CBDT announced that demand notices won’t be issued in cases of a minor mismatch between a taxpayer’s ITR and the corresponding tax credit data collected from banks and other financial institutions.

Source: Business Today

IT raid cases not to be processed under e-assessment: CBDT

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The soon-to-be rolled out pan India e-assessment system for scrutiny cases of taxpayers will not be applicable to instances where a raid has been conducted against an assessee by the Income Tax (IT) department, the CBDT has said.

It has added that the current system of manual assessment will continue in cases, where the books of accounts or original documents have to be examined, the taxman has to conduct a third-party investigation and where the tax officer has to examine a witness.

It will also be applicable to cases where the taxman has issued a show-cause notice to the assessee, “contemplating any adverse view”, and cases where the taxpayer has requested for a “personal hearing” to explain the matter to the assessing officer.

The Central Board of Direct Taxes (CBDT), the policy- making body of the IT department, issued an instruction yesterday to further explain how the system would work, once fully operational.

“…It is hereby directed that except for search-related assessments, proceedings in other pending scrutiny assessment cases shall be conducted only through the e-proceeding facility…,” the instruction said.

It added that in ranges where the IT offices were not equipped with computer infrastructure and Internet services as of now, the taxman should “complete only 10 per cent of the scrutiny cases having the potential to effect recovery during the current year itself”.

If an assessee objects to the electronic assessment, it may be “kept on hold” for the time being, the instruction said.

Finance Minister Arun Jaitley had, in his budget speech, announced that the process of electronic assessment of tax returns would be launched in the country, which would “almost eliminate person-to-person contact, leading to greater efficiency and transparency”.

CBDT Chairman Sushil Chandra, during a recent interview with , had said the e-assessment procedure would henceforth be handled by two officers, instead of the current system involving a single assessing officer (AO).

The functionality to conduct the e-proceedings would be available for all types of notices, questionnaires and letters issued under various sections of the I-T Act, the CBDT had said earlier.

Source: Times of India