ARCs, gaming, betting under lens: CBDT chief

Aug 27, 2022

Aided by data from multiple sources and data analytics, the income tax department has started scrutinising newer areas such as asset reconstruction companies, gaming and betting to plug tax evasion.“We are not limiting our actions (search and seizure operations) to real estate developers, healthcare, pharma and manufacturing. We have touched upon new areas which were never touched upon,” Central Board of Direct Taxes chairman Nitin Gupta has said.

Income Tax

Clarificatory circular on new TDS provisions for banks soon, says CBDT chairman

Aug 27, 2022

The CBDT will soon come out with a circular for various stakeholders, especially banks, to "clarify" the procedures on the applicability of new TDS provisions regarding benefits or prerequisites received in a business or profession. CBDT Chairman Nitin Gupta said the board, which frames policies for the Income-Tax department, will issue an official explainer on the subject, including the "pressing" issue of one-time settlement (OTS) being faced by the banks.
"We will clarify the position that will be helpful to the stakeholders. We will be coming out with a clarificatory circular very soon," he said during an interaction on Thursday. Gupta said all issues on the canvass of section 194R of the Income Tax Act will be addressed as part of the forthcoming circular. While the CBDT had issued a set of guidelines in June with regard to the applicability of the newly introduced section 194R in the Income Tax Act, the banking sector had specific concerns with regard to their businesses and operations.

Tax Deduction at Source

Exemption-free tax regime needs tweaking, analysts

Aug 29, 2022

With few takers for the income tax regime without exemptions even after two years of its introduction, the government may consider allowing some basic deductions and make the slabs more graded to make it more attractive to taxpayers under different brackets, analysts say. However, the dual regime tax regime may continue for another 2-3 years until the new regime finds acceptability through a mix of deductions and lower tax rates.

Income Tax

CBDT asks those who have won money in online games to pay taxes, file updated ITR

Aug 30, 2022

If you have won money playing online games in the previous financial year, then as per the Central Board of Direct Taxes (CBDT), you must file an updated ITR (i.e., ITR-U) and pay taxes on the online game winnings accordingly.The CBDT chairman Nitin Gupta, in an interview with PTI, said that ITR-U could also be utilised by those categories of taxpayers who have income from online games, lotteries and betting etc. "This is a provision for them to come forward and pay taxes rather than face the consequences of penalty or any other legal action under the income tax law," the CBDT chairman said.
ITR-U stands for income tax return - updated; announced by the finance minister Nirmala Sitharaman in her Budget 2022 speech. ITR-U is filed under section 139(8A) of the Income-tax Act, 1961. ITR-U or updated return was introduced to give taxpayers an easy route to correct mistakes related to estimating their incomes on which tax is payable.
ITR-U provides an opportunity to update one's income tax returns within two years after the end of the relevant assessment year. ITR-U provides an opportunity for taxpayers to include any income they forget to pay tax on while filing their ITR. It is important to note that additional tax is payable at 25% to 50% on the additional income.

Income Tax

Experts raise several red flags around section 194R of the Income Tax Act

• Aug 30, 2022
  
  

• Section 194R of the Income Tax Act, 1961, which makes it necessary to deduct 10 per cent tax at source on the value of any benefit or perquisite received by a resident Indian, was introduced by the government to widen the tax base and reduce tax evasion in the country. Experts, however, have flagged several complications around it."The threshold prescribed under section 194R does not sync with threshold prescribed under section 56," said Ravi Mehta, Managing Director and Head (Transaction Tax), and Amrita Bhatnagar, Associate Director, at RBSA Advisors.

  Under section 56, if the receipt of benefits by an individual or a Hindu Undivided Family (HUF) exceeds Rs 50,000 in a year, they are liable to pay a tax on it. However, under section 194R, the limit is Rs 20,000.

  "At the very instance, this would lead to tax outflow which is actually exempt in the hands of the recipient," they added.The section will not apply if the value of "benefit" or "perquisite" provided is less than 20,000. "The term 'benefit' or 'perquisite' is not defined in the Act," Akhil Chandna, partner, Grant Thornton Bharat, told Business Standard.The government had earlier stated that the receipt may be in cash or kind, but no clear definition was provided.

Income Tax

Most foreign jurisdictions reply to Pandora queries

• Sep 02, 2022
  
  

• The Financial Intelligence Unit (FIU), a key unit of the multi-agency probe into the 2021 global offshore investigation called the Pandora Papers, has received responses from its counterparts in over three-fourths of the requests it sent to 33 foreign jurisdictions.Officials said that using the network of FIUs in mostly the offshore havens mentioned in The Indian Express investigation (October 4-16, 2021), the FIU sent out 160 requests to foreign jurisdictions and has received responses in 125 cases so far.

International Tax

Direct tax collections may exceed budget targets, CBDT chief says

• Sep 02, 2022
  
  

• The Centre’s direct tax collection as on August 30 stood at Rs 4.8 trillion, which is 33 per cent more than the Rs 3.6 trillion collected in the same period last year, Nitin Gupta, chairman of the Central Board of Direct Taxes (CBDT), told Business Standard.Gupta said if the trend continued, direct tax collection for FY23 could exceed the Budget target of Rs 14.20 trillion

• “We have a healthy net collection after accounting for a higher refund outgo. There is a good buoyancy of tax collection so far,” Gupta said. “If this trend continues in the second instalment, we expect a fairly good tax collection over and above the targets laid down in the Budget,” he said.

Income Tax

Income-Tax Department issues tax refunds worth Rs 1.14 lakh crore so far this fiscal

• Sep 03, 2022
  
  

• The Income Tax Department has said that it has issued refunds worth over Rs 1.14 lakh crore to more than 1.97 crore taxpayers in the first five months of this fiscal year that started April 1, 2022.

• "Income tax refunds of Rs. 61,252 crore have been issued in 1,96,00,998 cases & corporate tax refunds of Rs. 53,158 crore have been issued in 1,46,871 cases," the Income Tax Department tweeted.

Income Tax