No capital gains or any other tax for Adani deal: Holcim CEO Jan Jenisch

• May 17, 2022
  
  
• Switzerland’s building materials conglomerate Holcim Group will not incur capital gains tax or any other tax following the stake sale of its Indian assets – Ambuja Cements and ACC – for about $10.5 billion to Adani Group. This gains importance as Hong Kong-based Hutchison was marred in a controversy following a $11-billion deal with UK’s Vodafone Group in 2007. “Our analysis comes to the conclusion that there is no capital gains or any other tax for this transaction. Never know if any complication would arise, but we assume we will get the 6.4 billion Swiss francs as net proceeds,” Holcim Chief Executive Officer Jan Jenisch said in an analysts’ call on Monday.
  

General

Non-ITR filers will face higher TDS

• May 19, 2022

• If you have not filed the income tax return for fiscal 2020-21, then you will be on the list of non-tax filers and have to face higher tax deduction at source from this financial fear. The Central Board of Direct Taxes (CBDT) has issued a circular to determine the non-filers, or “specified person” who are subject to higher tax withholding or collection for FY 2022-23, while relaxing some of the guidelines.
  According to the circular, if the ITR was not filed for the relevant previous fiscal year and the aggregate TDS and tax collected at source exceeded Rs 50,000 that year, it would attract a high TDS. Banks will be required to check if an individual has met both conditions to attract a higher TDS.

Income Tax

Finance Ministry to clarify doubts on applicability of TDS on perks received in business, profession

May 19, 2022

The finance ministry will clarify doubts on the applicability of new TDS provision regarding benefits or perquisites received in a business or profession, a senior tax official said on Wednesday. Joint Secretary in the finance ministry Kamlesh C Varshney said that such benefits and perquisites are income and were always taxable whether received in cash or kind. The Budget 2022-23 brought in the provision of tax deducted at source (TDS) on such income to check tax revenue leakage.

Tax Deduction at Source

Foreign investors from Mauritius likely to keep taxman at bay

• May 20, 2022
  Foreign investors coming from Mauritius are often denied capital gains tax relief on the grounds that persons controlling the tax haven companies are based in other countries. This may change now. One such attempt by the Income tax (I-T) department to lift the 'corporate veil' was struck down this week by a court which ruled that the tricky subject of 'beneficial ownership' (BO) of the Mauritian entity cannot be linked to capital gains. The ruling by Income tax Appellate Tribunal (ITAT), a quasi-judicial authority, relating to Blackstone FP Capital Partners Mauritius V Ltd, pertains to financial year 2015-16 when it booked capital gains of over ?900 crore after selling stocks of CMS Info Systems.
  

Income Tax

GAAR probe begins on companies suspected of tax avoidance

• May 20, 2022
  
  

• The revenue department has launched investigations under the anti-tax avoidance law, General Anti-avoidance Rule (GAAR), into companies and entities that may have used creative methods to avoid paying taxes.
  A Hyderabad-based company, Ekge Retail, has received a notice in which the department has applied Section 96(1)(d) of the Income-tax Act, which deals with impermissible agreements undertaken to avoid taxation.
  The company has now approached the high court for state of Telangana at Hyderabad challenging the applicability of the section for some transactions undertaken by it in 2018 and 2019. The notice was issued to the company in February 2022.

General

New ITR-U: 10 things you should know about Updated Income Tax Return filing

• May 21, 2022

• Updated ITR Filing 2022: The Income Tax Department recently announced a new form for filing of Updated Income Tax Returns. A new concept of updated return was introduced in Budget 2022. It allows taxpayers to amend their ITRs within two years from the end of the relevant assessment year. The new provision is expected to help taxpayers who often commit errors or make some omissions while filing ITR.
  1. In the form for Updated ITR, taxpayers are required to declare the purpose for filing as well as the amount of income to be taxed in the updated return.
  2.Taxpayers are not required to provide a break up of the income reported in the ITR (Updated).
  3. Taxpayers can now use the new form ITR-U to file the updated income tax return for financial years 2019-20 and 2020-21.
  4. Certain taxpayers are required to file the Updated ITR electronically using a digital signature or an electronic verification code. The taxpayer has to file the ITR Forms of the relevant assessment year and submit it along with the new ITR-U.
  5. The ITR-U has to be filed within two years of the end of the relevant assessment year. For doing this, taxpayers are also required to provide reasons for updating the ITR. According to Tax2Win, the reasons for filing ITR-U may be many, including previous return not filed, income not reported correctly , wrong heads of income choses, reduction of a carried forward loss etc.

Income Tax

MNCs under I-T lens over Esops to staff in India

• May 31, 2022
  
  

• Multinationals that allotted employee stock options (esops) to their India employees have come under the taxman's lens for tax applicability on these transactions. The tax department is questioning the Indian arms of multinationals on withholding tax when they make such payments to their parents. In most cases, employees around the world get stock options in the multinational's parent company, which is located outside India. "Many multinationals allocate global esops to employees and they tend to charge this amount to their Indian entities. The tax department is questioning whether any tax should be withheld on this amount when it's paid back to the foreign entity by the Indian entity," said Shefali Goradia, partner at Deloitte.

General

Clarity likely on taxing NFT as virtual digital asset

• Jun 06, 2022
  
  

• Ahead of the first due date of advance tax payment on June 15, the government is likely to release guidelines on what will be covered within the ambit of virtual digital assets (VDA). To remove any ambiguity in the recently established tax framework for asset holders, the Central Board of Direct Taxes (CBDT) is currently preparing guidelines, said government officials in the know. The apex direct tax body will define non-fungible tokens (NFTs) and whether or not they fall within the purview of VDA.

Income Tax