Legal Compliance Calendar for June Month-2016

Legal Compliance Calendar for June 2016: Every business consultant, business person and their legal and compliance department are always on guard that they fulfill all the regulatory filing on time. So solve this problem we have compiled the different due date for legal filing under different act like Income Tax Act 1961, Service tax laws, Central Excise and Custom, Companies Act 2013, provident Fund, Employee State Insurance Corporation or Value Added Tax etc.

Income Tax Compliance for June 2016 

  1. 7th June – Due for payment of TDS/TCS for May’2016
  2. 15th June- Last date for first installment of advance Income tax for Assessee having tax liability more than Rs. 10000/- and
  3. 15th June – Issuance of TDS certificate for other than salary for quarter 1 i.e. for TDS return filed for Period January to March 2016 due date for same was 15 May 2016 same has been to changed to 30 May for next year

Rules and Guidelines for Income Tax Compliance 

A. For companies

  • TDS deducted during May’2016 due for payment on 07.06.16.
  • Advance tax for FY 16-17 First instt of 15% due on 15/06/2016
  • Issue TDS certificate for Q1 for other than salary by 15/06/16 and TCS certificate by 30/05/16

B. For firm and individual covered under tax audits

  •  TDS deducted in May’ 2016 payment due on- 07.06.2016.
  • Advance tax to be paid 15% ( first installment) of tax liability till 15/06/2016
  • Issue TDS certificate for quarter ending 31st March 2016 for other than salary by 15/06/16 and TCS certificate by 30/05/2016
  • Annual information statement due date 31/05/2016

Central Excise and Custom  Compliance for June 2016 

  1. 6th June- Due date for payment of excise for the month of May’2016
  2. 10th June – Last date for excise return for the month of May’2016 – Due Date for ER-1

Rules and Guidelines for Central Excise Compliance 

  • Excise registered units as Small Scale Industry – No payment and no return due this month of June but Unit Registered as Non SSI units – Last date for payment for the month of May is 06.06.2016 and for return 10.06.2016

Service Tax Compliance for June 2016 

  1. 6th June- Due date for payment of service tax for the month of May’2016 for other than Individual, Partnership firm and HUF as they have deposit service tax on quarterly basis.i.e Companies has to deposit service tax on monthly basis in case

VAT Tax Compliance for June 2016 

  1. 14th June- Last date for payment of Rajasthan VAT liability for dealer covered under monthly tax liablity.
  2. 14th June – Last date for Works Contract Tax TDS is for May 2016
  3. 15th June – Last for Monthly return for Composition Dealer under Karnataka VAT
  4. 15th June – Last date for TDS deposit for previous month under Delhi VAT
  5. 20th June – Last date for monthly return or statement for tax deducted at source under KVAT using VAT – 100, VAT – 110 , VAT – 125, VAT–126, VAT-127
  6. 21st June -Last date for payment of MVAT liability.
  7. 29th June- Last date for filing of VAT 11 annual return for the Year 2015-16 in Rajasthan VAT
  8. 30th June – Due Date filing return half yearly return for October to March (For dealers not liable to file F-704 under Maharashtra VAT
  9. 30th June – Person who stands enrolled before the commencement of a year or is enrolled on or before 31st May of a year under under Profession Tax Act 1975 for Profession Tax Enrollment Certificate (PTEC) holder Maharashtra

Provident Fund and ESIC Compliance for June 2016 

  1. 15th June – last date for payment of Provident fund liability Due Date date for Provident fund Contribution, government has removed the grace period of 5 days from February 2016.
  2. 21st June- Last date for payment of ESIC liability for May 2016.
  3. 25th June- Last date for filing of PF return for the month of May

Corporate Law and LLP Compliance 

30th June – Extended Last date for return of LLP for FY- 2015-16

Summary Date-wise Compliance under different rules and regulation

  • 6th June- Due date for payment of excise and service tax for the month of May’2016
  • 7th June – Due for payment of TDS/TCS for May’2016
  • 10th June – Last date for excise return for the month of May’2016
  • 14th June- Last date for payment of RAJ VAT liability.
  • 14th June – Last date for WCT TDS is for May’2016
  • 15th June – last date for payment of Provident fund liability
  • 15th June- Last date for first installment of advance Income tax for Assessee having tax liability more than Rs. 10000/- and issuance of TDS certificate for other than salary for quarter 4 for FY 2015-16
  • 20th June – Different VAT return under Karnataka VAT
  • 21st June – MVAT last Date of Payment
  • 21st June- Last date for payment of ESIC liability for May 2016.
  • 25th June- Last date for filing of PF return for the month of May
  • 29th June- Last date for filing of VAT 11 annual return for the Year 2015-16 in RAJ VAT
  • 30th June – Extended Last date for return of LLP for FY- 2015-16

KEY IMPORTANT FEATURES OF INDIA BUDGET 2016-17

Key Features of India Budget for Year 2016-2017

  • Growth of Economy accelerated to 7.6% in 2015-16. Fiscal deficit in RE 2015-16 and BE 2016-17 retained at 3.9% and 3.5%. Revenue Deficit target from 2.8% to 2.5% in RE 2015-16.
  • Total expenditure projected at Rs. 19.78 lakh crore. Plan expenditure pegged at Rs. 5.50 lakh crore under Plan, increase of 15.3%. Non-Plan expenditure kept at Rs.14.28 lakh crores
  • Foreign exchange reserves touched highest ever level of about 350 billion US dollars.
  • Allocation for Agriculture and Farmers’ welfare is Rs. 35,984 crore
  • ‘Pradhan Mantri Krishi Sinchai Yojana’ to be implemented in mission mode. 28.5 lakh hectares will be brought under irrigation.
  • A dedicated Long Term Irrigation Fund will be created in NABARD with an initial corpus of about Rs 20,000 crore.
  • Promote organic farming through ‘Parmparagat Krishi Vikas Yojana’ and ‘Organic Value Chain Development in North East Region’.
  • Allocation under Pradhan Mantri Gram Sadak Yojana increased to Rs. 19,000 crore. Will connect remaining 65,000 eligible habitations by 2019.
  • To reduce the burden of loan repayment on farmers, a provision of Rs.15,000 crore has been made in the BE 2016-17 towards interest subvention
  • Allocation under Prime Minister Fasal Bima Yojana Rs.5,500 crore.
  • Rs. 850 crore for four dairying projects – ‘Pashudhan Sanjivani’, ‘Nakul Swasthya Patra’, ‘E-Pashudhan Haat’ and National Genomic Centre for indigenous breeds.
  • A sum of Rs. 38,500 crore allocated for MGNREGS (Mahatma Gandhi National Rural Employment Gurantee Act for Details About NREGA Scheme www.nrega.nic.in)
  • 3,000 Stores under Prime Minister’s Jan Aushadhi Yojana will be opened during 2016-17.
  • “Stand Up India Scheme” to facilitate at least two projects per bank branch. This will benefit at least Rs.2.5 lakh entrepreneurs.
  • Digital Depository for School Leaving Certificates, College Degrees, Academic Awards and Mark sheets to be set-up.
  • GoI will pay contribution of 8.33% for of all new employees enrolling in EPFO for the first three years of their employment. Budget provision of Rs. 1000 crore for this scheme.
  • Deduction under Section 80JJAA of the Income Tax Act will be available to all assesses who are subject to statutory audit under the Act.
  • Total investment in the road sector, including PMGSY allocation, would be Rs. 97,000 crore during 2016-17.
  • India’s highest ever kilometres of new highways were awarded in 2015. To approve nearly 10,000 kms of National Highways in 2016-17.Allocation of Rs. 55,000 crore in the Budget for Roads. Additional Rs. 15,000 crore to be raised by NHAI through bonds.Total outlay for infrastructure – Rs. 2,21,246 crore.
  • Mobilisation of additional finances to the extent of Rs. 31,300 crore by NHAI, PFC, REC, IREDA, NABARD and Inland Water Authority by raising Bonds.
  • Amendments in the SARFAESI Act 2002 to enable the sponsor of an ARC to hold up to 100% stake in the ARC and permit non institutional investors to invest in Securitization Receipts.
  • Allocation of Rs. 25,000 crore towards recapitalisation of Public Sector Banks.Target of amount sanctioned under Pradhan Mantri Mudra Yojana increased to Rs. 1,80,000 crore.General Insurance Companies owned by the Government to be listed in the stock exchanges.
  • Raise the ceiling of tax rebate under section 87A from Rs.2000 to Rs.5000 to lessen tax burden on individuals with income upto Rs. 5 laks. Increase the limit of deduction of rent paid under section 80GG from Rs.24000 per annum to Rs.60000, to provide relief to those who live in rented houses.Deduction for additional interest of Rs.50,000 per annum for loans up to Rs.35 lakh sanctioned in 2016-17 for first time home buyers, where house cost does not exceed Rs. 50 lakh.
  • Increase the turnover limit under Presumptive taxation scheme under section 44AD of the Income Tax Act to Rs.2 crores to bring big relief to a large number of assessees in the MSME category.
  • Extend the presumptive taxation scheme with profit deemed to be 50%, to professionals with gross receipts up to Rs.50 lakh
  • Phasing out deduction under Income Tax: Accelerated depreciation wherever provided in IT Act will be limited to maximum 40% from 1.4.2017. Benefit of deductions for Research would be limited to 150% from 1.4.2017 and 100% from 1.4.2020. Benefit of section 10AA to new SEZ units will be available to those units which commence activity before 31.3.2020. The weighted deduction under section 35CCD for skill development will continue up to 1.4.2020.
  • Additional tax at the rate of 10% of gross amount of dividend will be payable by the recipients receiving dividend in excess of Rs.10 lakh per annum.
  • New manufacturing companies incorporated on or after 1.3.2016 to be given an option to be taxed at 25% + surcharge and cess provided they do not claim profit linked or investment linked deductions and do not avail of investment allowance and accelerated depreciation. Lower the corporate tax rate for the next financial year for relatively small enterprises i.e companies with turnover not exceeding Rs.5 crore (in the financial year ending March 2015), to 29% plus surcharge and cess.
  • 100% deduction of profits for 3 out of 5 years for startups setup during April, 2016 to March, 2019. MAT will apply in such cases.
  • 10% rate of tax on income from worldwide exploitation of patents developed and registered in India by a resident.
  • Complete pass through of income-tax to securitization trusts including trusts of ARCs. Securitisation trusts required to deduct tax at source.
  • Period for getting benefit of long term capital gain regime in case of unlisted companies is proposed to be reduced from three to two years.
  • Non-banking financial companies shall be eligible for deduction to the extent of 5% of its income in respect of provision for bad and doubtful debts.
  • Determination of residency of foreign company on the basis of Place of Effective Management (POEM) is proposed to be deferred by one year.
  • Commitment to implement General Anti Avoidance Rules (GAAR) from 1.4.2017.
  • Exemption of service tax on services provided under Deen Dayal Upadhyay Grameen Kaushalya Yojana and services provided by Assessing Bodies empanelled by Ministry of Skill Development & Entrepreneurship.
  • Exemption of Service tax on general insurance services provided under ‘Niramaya’ Health Insurance Scheme launched by National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disability.
  • Basic custom and excise duty on refrigerated containers reduced to 5% and 6%.
  • Surcharge to be raised from 12% to 15% on persons, other than companies, firms and cooperative societies having income above Rs. 1 crore.
  • Tax to be deducted at source at the rate of 1 % on purchase of luxury cars exceeding value of Rs.ten lakh and purchase of goods and services in cash exceeding Rs.two lakh.
  • Securities Transaction tax in case of ‘Options’ is proposed to be increased from .017% to .05%.
  • Equalization levy of 6% of gross amount for payment made to non- residents exceeding ` 1 lakh a year in case of B2B transactions.
  • Krishi Kalyan Cess, @ 0.5% on all taxable services, w.e.f. 1 June 2016. Proceeds would be exclusively used for financing initiatives for improvement of agriculture and welfare of farmers. Input tax credit of this cess will be available for payment of this cess.
  • Infrastructure cess, of 1% on small petrol, LPG, CNG cars, 2.5% on diesel cars of certain capacity and 4% on other higher engine capacity vehicles 13 and SUVs. No credit of this cess will be available nor credit of any other tax or duty be utilized for paying this cess.
  • Excise duty of ‘1% without input tax credit or 12.5% with input tax credit’ on articles of jewellery [excluding silver jewellery, other than studded with diamonds and some other precious stones], with a higher exemption and eligibility limits of Rs.6 crores and Rs.12 crores respectively.
  • Excise on readymade garments with retail price of Rs.1000 or more raised to 2% without input tax credit or 12.5% with input tax credit.
  • ‘Clean Energy Cess’ levied on coal, lignite and peat renamed to ‘Clean Environment Cess’ and rate increased from Rs.200 per tonne to Rs.400 per tonne.
  • Excise duties on various tobacco products other than beedi raised by about 10 to 15%.
  • Domestic taxpayers can declare undisclosed income or such income represented in the form of any asset by paying tax at 30%, and surcharge at 7.5% and penalty at 7.5%, which is a total of 45% of the undisclosed income. Declarants will have immunity from prosecution.
  • Surcharge levied at 7.5% of undisclosed income will be called Krishi Kalyan surcharge to be used for agriculture and rural economy.
  • New Dispute Resolution Scheme to be introduced. No penalty in respect of cases with disputed tax up to Rs.10 lakh. Cases with disputed tax exceeding Rs.10 lakh to be subjected to 25% of the minimum of the imposable penalty.
  • Any pending appeal against a penalty order can also be settled by paying 25% of the minimum of the imposable penalty and tax interest on quantum addition.
  • High Level Committee chaired by Revenue Secretary to oversee fresh cases where assessing officer applies the retrospective amendment.
  • One-time scheme of Dispute Resolution for ongoing cases under retrospective amendment.
  • Penalty rates to be 50% of tax in case of underreporting of income and 200% of tax where there is misreporting of facts.
  • Disallowance will be limited to 1% of the average monthly value of investments yielding exempt income, but not exceeding the actual expenditure claimed under rule 8D of Section 14A of Income Tax Act.
  • Time limit of one year for disposing petitions of the tax payers seeking waiver of interest and penalty.
  • Mandatory for the assessing officer to grant stay of demand once the assesse pays 15% of the disputed demand, while the appeal is pending before Commissioner of Income-tax (Appeals).
  • Monetary limit for deciding an appeal by a single member Bench of ITAT enhanced from Rs. 15 lakhs to Rs.50 lakhs.
  • 11 new benches of Customs, Excise and Service Tax Appellate Tribunal (CESTAT).

How to Pay or Deposit Outstanding Income Tax Demand Online or Offline through Challan 280

Income Tax Demand or Refund is issued once your assessment for that year is completed and Income tax officer i.e. Assessing Officer issues Income Tax Assessment order under section 143 (Summary assessment and Scrutiny assessment), Section 144 (Best judgment assessment), Section 147(Income escaping assessment). But Once Assessment is completed there can three outcome

1. No Demand or Refund for that Assessment Year

2. Refund Issued for that Assessment Year

3.  Demand Payable

So Assessee has two option or alternate in relation to that assessment year he accepts it or rejects is in case no acceptable then he can file Appeal Against that Assessment year with Income Tax Appeal with 30 days of receipt of Income tax Assessment order. In case accepts that Assessment order he has the option to pay outstanding  Income Tax Demand either online or offline through challan no 280. Basic Information required for Depositing Income Tax Demand or Normal Income Tax is PAN Number and Year for which you want to deposit income tax.

Process for Deposit Online Outstanding Income Tax Demand (Click on Link for Payment of Income Tax ) or Download the Challan No 280

Opening Page for tax Information System

Select Challan No 280 :Payment of Income Tax & Corporation Tax 

Challan No 280 Online Payment Screen

Tax Applicable: select code 21 for any Person other than Companies

PAN Number: 

Assessment for Year: Year for which Demand is Outstanding (Note Asst Year for Financial Year 2011-12 will be 2012-13, 2012-13 will be 2013-14, 2013-14 will be 2014-15 and So on)

Name of Person: As Given on PAN Card (it will be displayed once you fill all details and click on proceed link given at the end of form 280)

Address of the Assessee

Mobile No and Email id

Type Of Payment: Select 400(TAX ON REGULAR ASSESSMENT) for Income Tax Demand Deposit and 300 (SELF ASSESSMENT TAX) for Deposit of Tax Before filing Income tax return after year ending and 100 (ADVANCE TAX) for deposit of Income Tax Before year ending for FY 2015-16 (Assessment Year 2016-17) upto 31st March 2016.

Select Bank: Bank for which Net Banking Facility is activated

Once Proceed is Selected Confirmation Screen will be opened

CONFIRMATION PAGE FOR TAX PAYMENT

If All the Details Correct Select Submit to Bank Option.

In Case if Assessee wants to Deposit Income Tax Offline then he can download Challan No 280 and Fill the Above details

Download (PDF)

 

Extension of Due Date of Returns of Income and Audit reports u/s 44AB to 31st Oct 2015

Central Board of Direct Taxes (Income Tax Dept) has extended the due date of Filing Income Tax Return and Audit Report from 30th Sept 2015 to 31st Oct 2015.

F.No.22S/207 /201S/1T A.II

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

North Block, ITA.rr Division

New Delhi dated the 1 st of October, 2015

Order under Section 119 of the Income-tax Act, 1961 In supersession of orders under Section 119 of the Income-tax Act, 1961 (‘Act’) dated 30th September, 20 15 vide file of even number, the Central Board of Direct Taxes, in exercise of powers conferred under Section 119 of the Act, hereby orders that the returns of income and audit reports u/s 44AB due for e-filing by 30th September, 20 15 may be filed, across the country, by 3 1 st October, 2015.

(Rohit Garg)

Deputy Secretary to the Government of India

Download (PDF)

New ITR Released For A.Y. 2015-16

New ITR Form ITR-1, ITR-2, ITR-4S for A.Y. 2015-16 (Financial Year 2014-15) has been released by the Income Tax Department for physical filing i.e. submitting ITR to Income Tax Department Office

The Income Tax Department releases the updated ITR every year for income tax return filing for Physical & E-filing of ITR. Income tax department has released new Income Tax Return Form vide notification 41/2015 dated 15/04/2015, while all ITR utility for E-filling  is still pending .i.e. ITR 1 ITR 2 & ITR 4S are released for physical filing but ITR 3, ITR 4 , ITR 5 , ITR 6 & ITR 7 are pending.

There are few differences in old and new ITR forms (AY 2014-15 Vs  AY 2015-16). Some new features includes uploading the ITR utility itself as compared to previous ITR excel utilities wherein the taxpayer was required to first prepare the xml file from the ITR utility and than manually upload on the income tax website. The new ITR java utility has the option for both manual as well as automatic upload of the Income Tax Return on the income tax website.

Further changes like: Compulsory e-filing, if refund is claimed by Assessee; No need to send ITR V to Bengaluru if you are using  Electronic Verification Code system, which has been implemented by Income Tax Department from AY 2015-16.

Details of changes in New ITR as launched on 15/04/2015 

ITR-1:

Introduction of furnishing AADHAR CARD Number in Income Tax Return, which will be used for EVC system. Introduction of EVC for verification of return of income filed as an option to send ITR V to CPC, Bangalore.

Bank Account Details in Income Tax Return

ITR-2:

Details of Foreign Travel made if any includes Passport No., Issued at, Name of Country, No. of Times Traveled and Expenditure. In Schedule FA- Foreign Assets Disclosure: Foreign Bank Account Details are further requirement. For Non-resident, income from other sources, if any income chargeable to tax at special rate provided in DTAA, it is now required to provide details. Details of utilization of amount deposited in Capital Gain Account Scheme for years preceding to last two Assessment Years.

ITR FOREIGN TRIP CONSENT AND DETAILS FOR INCOME TAX RETURN

ITR-4S:

Details of all Bank Accounts with Bank Name, IFSC Code, Name of Joint Holder (if any), Account Number, Account Balance as on 31.03.2015 mandatory to be provided. Even those accounts which are closed during the year.

 

Download (PDF)

Download (PDF)

Download (PDF)

How to Update Mobile number & E-mail ID of Tax payers on e-Filing Portal of Income Tax India Website

The process of updating and authenticating the contact details Mobile number & E-mail ID of Tax payers on e-Filing Portal of Income Tax India Website.

Updating Contact Details for FIRST TIME USER (NEW TAX PAYER) 

Provide the correct Mobile Number and Email ID during the Registration in the e-Filing portal, Activation link would be sent to the registered E-mail ID and a One Time Password (OTP also called PIN) is sent to the registered  Mobile Number. User needs to Click on the Link provided in the E-mail and  enter the OTP received in the mobile number for Successful activation of the  registered user in e-Filing portal.

Updating Contact Details for OLD USER (ALREADY REGISTERED TAX PAYER OR USERS) 

After the user logs in to the e-filing account, there will be a pop-up requesting the user to update the current Mobile number and E-mail ID. The user should update their personal Mobile number and Email so that the updated contact particulars are registered with the Department or confirm that the Mobile number and email ID already registered is their valid personal contacts.
Upon submitting the details, Department would immediately send OTPs  (PIN1 & PIN2) to new mobile number and Email ID. The respective PINs- PIN1 and PIN2 received through Mobile number and E-mail ID should be entered by them in the respective input fields to authenticate that the email ID and mobile are correct. Upon successful validation the Mobile number and email ID would be updated in the taxpayer’s profile and the process
would be complete.
The PIN1 and PIN2 would be valid only for the session – so taxpayers are advised not to close the webpage till PINs are entered and validated. In case of any difficulty or delay, the taxpayer can log in again and follow the same process to update the current contact details.

List of Authorised Banks for E-Payment of Income Tax: Banks for Online Tax Payment

List of Banks authorized by Income Tax Department for collecting E-Payment of Income Tax .i.e Online Collection of Advance Income tax, Tax Deducted Source (TDS) and Self Assessment Tax under Income Tax Act through NSDL. Total 30 Indian Banks have been empanelled for online Tax Collection  for Payment of TDS on Sale of Property (Form 26QB), Tax Deducted at Source / Tax Collected at Source (TDS/TCS) from corporates or non-corporates TDS/TCS (CHALLAN NO./ITNS 281), payment of Income tax & Corporation Tax (CHALLAN NO./ITNS 280), payment of Security Transaction Tax, Hotel Receipts Tax, Estate Duty, Interest Tax, Wealth Tax, Expenditure Tax /Other direct taxes & Gift tax (CHALLAN NO./ITNS 282).

Following is the List of Banks for Online Tax Collection (Income Tax, Service Tax, Custom and Excise)

  1. Allahabad Bank
  2. Andhra Bank
  3. Axis Bank
  4. Bank of Baroda
  5. Bank of India
  6. Bank of Maharashtra
  7. Canara Bank
  8. Central Bank of India
  9. Corporation Bank
  10. Dena bank
  11. HDFC Bank
  12. ICICI Bank
  13. IDBI Bank Limited
  14. Indian Bank
  15. Indian Overseas Bank
  16. Jammu and Kashmir Bank
  17. Oriental Bank of Commerce
  18. Punjab National Bank
  19. State Bank of Bikaner & Jaipur
  20. State Bank of Hyderabad
  21. State Bank of India
  22. State Bank of Indore
  23. State Bank of Mysore
  24. State Bank of Patiala
  25. State Bank of Travancore
  26. Syndicate Bank
  27. UCO BANK
  28. Union Bank of India
  29. United Bank of India
  30. Vijaya Bank

Extension of Due Date of Filing Income Tax Return & Audit Report for FY 2012-13: AY 2013-14

Central Board of Direct Taxes (CBDT) has extended the due date of filing of Income Tax return and Audit report for FY 2012-2013.i.e AY 2013-2014 to 31st Oct 2013 from prescribe due date of 30th September 2013. Such decision has taken by CBDT after Delhi Chartered Accountant Society has filed writ petition in Delhi High Court for  extension of due date of tax audit as on the last date of tax Audit  i.e. 30.09.2013 there was default on the part of the Respondents as the site of the Income Tax Department was not working or response time of income tax website was very slow which made the e-filing of Income tax return impossible.

F.No. 225/117/2013/lTA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North- New Delhi,

The Order under Section 119 of the Income Tax Act 1961

In exercise of powers conferred under section 119 of the Income-tax act, 1961 The Central Board of Direct Taxes, In continuation to order u/s 119 dated 26.09.2013 in F.No. 225/117/2013/1TA.II, hereby directs that in cases where the ‘due date’ of  furnishing audit and corresponding income-tax returns was 30th September, 2013 and when furnished electronically on or before 31 14 October, 2013, such reports of audit income shall be deemed to have been furnished within the ‘due date’ prescribed under section 139 of the Income-tax Act, 1961.

Failure to pay whole or any part of income-tax or interest or both in accordance with the provisions of section 140A(1), 140A(3), 221(1)

Failure to pay whole or any part of income-tax or interest or both in accordance with the provisions of section 140A(1), 140A(3), 221(1)

Sec. 140A: Self-Assessment

Before submitting returns Assessee is supposed to find whether he is liable for any tax or interest. For this purpose this section has been introduced in Income tax act.

1. Applicability:

  (a) Filling of Return of income u/s 139 or in response to a notice u/s 142 / 153A / 158BC as the case may be after taking into account the amount of tax, if any, already paid under any provision of this Act.

  (b) Filling of Return of Fringe benefits u/s 115WD or 115WH

2. W.e.f. A.Y.  2009-10, Self-assessment tax is determined as under:

StepParticularsIts.
1Compute Total Income under Income tax Actxxx
2

3

4

5

6

Compute Tax on Total income as rates in force

Add: Surcharge (wherever applicable) + EC + SHEC

Tax Payable

Less: Amount of Tax, if any, already paid (i.e. Advance tax)

Tax deducted at source/ Tax collected at source

Relief of Tax u/s 90 or Deduction u/s 91 for tax paid in Foreign                            Country

Relief of Tax u/s 90A for tax paid in Specified Territory                          outside India

Tax Credit u/s 115JAA

Tax Payable before Interest

xxx

xx

xxx

(xxx)

(xx)

(xxx)

 

(xxx)

 

(xx)

xxx

7Add: Interest u/s 234A/ 234BI/ 234C/ 115WKxxx
8Tax Payable on Self-Assessmentxxx

3. Consequences of Failure to pay whole or part of Self-Assessment Tax:

  • Interest u/s 220: The Assessee is liable to pay interest @ 1% per month or part of the    month on the tax amount remaining unpaid commencing from the day immediately following 30 days of filling the return upto the date of payment.

No interest shall be levied if the Assessee proves to the satisfaction of the Assessing officer that the default was for good and sufficient reasons.

The above interest is in addition to any other interest charged u/s 234A, 234B, 234C.

  • Penalty u/s 221: Subject to a maximum penalty of the tax arrears.

4.  Where there is any shortfall in the payment in payment u/s 140A, the amount paid shall be first adjusted towards interest payable and balance shall be adjusted towards tax payable.

SectionNature of defaultMinimum penaltyMaximum penalty
(1)(2)(3)(4)
 

140A(3)

 

Failure to pay whole or any part of income-tax or interest or both in accordance with the provisions of section 140A(1)

 

Such amount as the Assessing Officer may impose [Sec.221(1)]

 

Tax in arrears

Reference: Section 140A (3), 140A(1), 221(1) of Income tax act, 1961

Self-assessment under section 140A

(1) Where any tax is payable on the basis of any return required to be furnished under [section 115WD or section 115WH] or section 139 or section 142 [or section 148 or [section 153A] or, as the case may be, section 158BC, after taking into account,—

 (i)  the amount of tax, if any, already paid under any provision of this Act;

(ii)  any tax deducted or collected at source;

(iii)  any relief of tax or deduction of tax claimed under section 90 or section 91 on account of tax paid in a country outside India;

(iv)  any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section; and

(v)  any tax credit claimed to be set off in accordance with the provisions of section 115JAA  [or section 115JD],]

 the Assessee shall be liable to pay such tax together with interest payable under any provision of this Act for any delay in furnishing the return or any default or delay in payment of advance tax, before furnishing the return and the return shall be accompanied by proof of payment of such tax and interest.

 [Explanation.—where the amount paid by the Assessee under this sub-section falls short of the aggregate of the tax and interest as aforesaid, the amount so paid shall first be adjusted towards the interest payable as aforesaid and the balance, if any, shall be adjusted towards the tax payable.]

(1A) for the purposes of sub-section (1), interest payable,—

 (i) under section 234A shall be computed on the amount of the tax on the total income as declared in the return as reduced by the amount of,—

(a)  advance tax, if any, paid;

(b)  any tax deducted or collected at source;

(c)  any relief of tax or deduction of tax claimed under  section 90 or section 91 on account of tax paid in a country outside India;

(d)  any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section; and

(e)  any tax credit claimed to be set off in accordance with the provisions of section 115JAA  [or section 115JD];]

(ii) under section 115WK shall be computed on the amount of tax on the value of the fringe benefits as declared in the return as reduced by the advance tax, paid, if any.

 [(1B) For the purposes of sub-section (1), interest payable under section 234B shall be computed on an amount equal to the assessed tax or, as the case may be, on the amount by which the advance tax paid falls short of the assessed tax.

 [Explanation.—For the purposes of this sub-section, “assessed tax” means the tax on the total income as declared in the return as reduced by the amount of,—

 (i)  tax deducted or collected at source, in accordance with the provisions of Chapter XVII, on any income which is subject to such deduction or collection and which is taken into account in computing such total income;

(ii)  any relief of tax or deduction of tax claimed under section 90 or section 91 on account of tax paid in a country outside India;

(iii)  any relief of tax claimed under section 90A on account of tax paid in any specified territory outside India referred to in that section; and

(iv)  any tax credit claimed to be set off in accordance with the provisions of section 115JAA  [or section 115JD].]]

 [(3) If any Assessee fails to pay the whole or any part of such tax or interest or both in accordance with the provisions of sub-section (1), he shall, without prejudice to any other consequences which he may incur, be deemed to be an Assessee in default in respect of the tax or interest or both remaining unpaid, and all the provisions of this Act shall apply accordingly.]

 

 

 

 

Penalty payable when tax in default under sec 221(1)

When an Assessee is in default or is deemed to be in default in making a payment of tax, he shall, in addition to the amount of the arrears and the amount of interest payable under sub-section (2) of section 220, be liable, by way of penalty, to pay such amount as the  [Assessing] Officer may direct, and in the case of a continuing default, such further amount or amounts as the  [Assessing] Officer may, from time to time, direct, so, however, that the total amount of penalty does not exceed the amount of tax in arrears :

Provided that before levying any such penalty, the Assessee shall be given a reasonable opportunity of being heard:

 [Provided further that where the Assessee proves to the satisfaction of the [Assessing] Officer that the default was for good and sufficient reasons, no penalty shall be levied under this section.]

 [Explanation.—for the removal of doubt, it is hereby declared that an Assessee shall not cease to be liable to any penalty under this sub-section merely by reason of the fact that before the levy of such penalty he has paid the tax.]