As continuation to our previous discussions
Sec 80D of Income Tax act 1961
The limit for Section 80D deduction is Rs 25,000 for premiums paid for self/family. For premiums paid for parents who are senior citizens, one can claim a deduction upto Rs 30,000. This limit has been raised in Budget 2018 from Rs 30,000 to Rs 50,000. i.e. effective 1 April 2018, one can claim upto RS 50,000 as a deduction for premium paid for senior citizen parents. Additionally, health checkups to the extent of Rs 5,000 are also allowed and are covered within the overall limit of Rs 25,000 and Rs 50,000 as the case may be.
Sec 24B of Income Tax act 1961 Homeowners have the option to claim up to INR 2 lakhs as a deduction for interest on home loan for the self-occupied property.
If the house property is let out, the deduction is allowed for the entire interest pertaining to such home loan.
Sec 80D of Income Tax act 1961
The limit for Section 80D deduction is Rs 25,000 for premiums paid for self/family. For premiums paid for parents who are senior citizens, one can claim a deduction upto Rs 30,000. This limit has been raised in Budget 2018 from Rs 30,000 to Rs 50,000. i.e. effective 1 April 2018, one can claim upto RS 50,000 as a deduction for premium paid for senior citizen parents. Additionally, health checkups to the extent of Rs 5,000 are also allowed and are covered within the overall limit of Rs 25,000 and Rs 50,000 as the case may be.
Sec 24B of Income Tax act 1961 Homeowners have the option to claim up to INR 2 lakhs as a deduction for interest on home loan for the self-occupied property.
If the house property is let out, the deduction is allowed for the entire interest pertaining to such home loan.
For the Financial Year 2019-20 applicable Tax Exemption as per Budget 2019 1. Standard Deduction from Salary: Standard deduction has been increased from Rs 40,000 to Rs 50,000 for salaried individuals (which was introduced in the Budget 2018 in lieu of exemption for medical reimbursement and conveyance allowance).
2. No deemed rental income on having two residential house properties:
Home-owners will not be required to pay tax on notional rent if they have more than one self-occupied property. According to the budget proposals, exemption has been proposed on the income tax from the notional rent on second -self-occupied house. However, there is no change in aggregate limit for deduction in respect of interest on housing loan. The aggregate deduction for interest on housing loan for both houses cannot exceed Rs. 30000 or Rs. 2,00,000.
3. Rebate under section 87A:
Individual taxpayers with annual income up to Rs. 5 lakh rupees will get full tax rebate. The income limit eligible to avail tax rebate under section 87A have been raised to Rs. 5 lakh from Rs. 3.5 lakh. The limit of tax rebate under section 87A increased to Rs. 12,500.00 from Rs. 2,500.00
4. Section 54 Relied extended to 2 Residential Houses:
Individual or HUF will able to claim Long Term Capital Gains (Capital gain on Sale of Residential House) exemption benefit where sales Proceeds are invested in purchase of Two Residential House but subject to following Conditions
the long-term capital gains from sale of such house property shall not exceed Rs 2 crore, and
the benefit can be claimed only once in the taxpayer’s lifetime
2. No deemed rental income on having two residential house properties:
Home-owners will not be required to pay tax on notional rent if they have more than one self-occupied property. According to the budget proposals, exemption has been proposed on the income tax from the notional rent on second -self-occupied house. However, there is no change in aggregate limit for deduction in respect of interest on housing loan. The aggregate deduction for interest on housing loan for both houses cannot exceed Rs. 30000 or Rs. 2,00,000.
3. Rebate under section 87A:
Individual taxpayers with annual income up to Rs. 5 lakh rupees will get full tax rebate. The income limit eligible to avail tax rebate under section 87A have been raised to Rs. 5 lakh from Rs. 3.5 lakh. The limit of tax rebate under section 87A increased to Rs. 12,500.00 from Rs. 2,500.00
4. Section 54 Relied extended to 2 Residential Houses:
Individual or HUF will able to claim Long Term Capital Gains (Capital gain on Sale of Residential House) exemption benefit where sales Proceeds are invested in purchase of Two Residential House but subject to following Conditions
the long-term capital gains from sale of such house property shall not exceed Rs 2 crore, and
the benefit can be claimed only once in the taxpayer’s lifetime
Guys new update - Aadhar Pan Link deadline extended- The aadhar PAN link deadline has been extended to 30th September 2019. Central Borad of Direct taxes (CBDT) has pronounced the extension in aadhar card linking with pan card on 31st March 2019. vide its notification no 31/2019.
Today we will share Changes that are applicable with effect from 1st April 2019 with respect to GST Laws
1. New Scheme is now available @ 6% to Intra-State Suppliers of Goods or Services.
A new scheme has recently been introduced wherein an Intra-State supplier can now pay GST at the rate of 6% (3% for Central and 3% for respective State) on first supplies of goods or services for Rs. 50 lakhs.
With effect from April 1, 2019 the benefit of this scheme can be availed. This scheme shall be available only if the aggregate turnover of supplier does not exceed Rs. 50 lakhs during the previous financial year. The benefit of this scheme shall not be available to service providers who are rendering services in multiple States or through e-commerce websites. Thus, Chartered Accounts, Architects, etc. may not avail, this scheme if they have clients in different States.
2. Threshold Limit for composition scheme has been increased to Rs. 1.5 crores The existing threshold limit on gross turnover in previous financial year to avail of the composition scheme has been increased from Rs. 1 crore to Rs. 1. 5 crores. In respect of special category States (North-Eastern States), the threshold limit has been increased from Rs. 50 lakhs to Rs. 75 lakhs. Consequently, the taxable persons can substantially reduce their compliance burden as they would be required to file GST returns on quarterly basis instead of monthly basis. 3. Threshold limit to take registration has been increased to Rs. 40 lakhs As per Section 23 of the CGST Act, every person is required to obtain the GST registration if his turnover from supply of goods or services exceeds Rs. 20 lakhs. This threshold limit has been increased to Rs. 40 lakhs only if supplier is engaged in supply of goods. In other words, any person who is engaged in supply of goods and his total turnover in the current financial year does not exceed Rs. 40 lakhs, he is not required to take registration under GST. This exemption from GST registration is subject to various conditions, inter alia, he is not making any Inter-State supply, he is not a non-resident taxable person, etc. 4. Due dates for filing of GSTR-1 and GSTR-3B have been announced The due dates for filing of GSTR-1 and GSTR-3B for the months of April, May and June of 2019 have been notified, which shall be as follows:
In case of GSTR-1
If the turnover of registered person is up-to Rs. 1.50 crores for the months of April to June, 2019, he shall file his GSTR-1 on a quarterly basis and the due date shall be 31st July, 2019.
If the turnover of registered person exceeds Rs. 1.50 crores for the months of April to June, 2019, he shall file his GSTR-1 on a monthly basis and the due date shall be 11th of succeeding month.
In case of GSTR-3B
Form GSTR-3B shall be filed on a monthly basis by every tax payer who is required to file GSTR-3B and due date shall be 20th of the succeeding month. 5. Option to opt for Composition Scheme Any registered person who wants to pay tax under Composition Scheme for the F.Y. 2019-20 shall file an intimation, duly signed and verified, on the GST common portal, latest March 31, 2019.
6. Last chance to avail Input Tax Credit relating to F.Y. 2017-18 The registered person can avail input tax credit of GST paid from July, 2017 to March, 2018, latest by the due date of furnishing the return for the month of March, 2019 i.e. by April 20, 2019.
A new scheme has recently been introduced wherein an Intra-State supplier can now pay GST at the rate of 6% (3% for Central and 3% for respective State) on first supplies of goods or services for Rs. 50 lakhs.
With effect from April 1, 2019 the benefit of this scheme can be availed. This scheme shall be available only if the aggregate turnover of supplier does not exceed Rs. 50 lakhs during the previous financial year. The benefit of this scheme shall not be available to service providers who are rendering services in multiple States or through e-commerce websites. Thus, Chartered Accounts, Architects, etc. may not avail, this scheme if they have clients in different States.
2. Threshold Limit for composition scheme has been increased to Rs. 1.5 crores The existing threshold limit on gross turnover in previous financial year to avail of the composition scheme has been increased from Rs. 1 crore to Rs. 1. 5 crores. In respect of special category States (North-Eastern States), the threshold limit has been increased from Rs. 50 lakhs to Rs. 75 lakhs. Consequently, the taxable persons can substantially reduce their compliance burden as they would be required to file GST returns on quarterly basis instead of monthly basis. 3. Threshold limit to take registration has been increased to Rs. 40 lakhs As per Section 23 of the CGST Act, every person is required to obtain the GST registration if his turnover from supply of goods or services exceeds Rs. 20 lakhs. This threshold limit has been increased to Rs. 40 lakhs only if supplier is engaged in supply of goods. In other words, any person who is engaged in supply of goods and his total turnover in the current financial year does not exceed Rs. 40 lakhs, he is not required to take registration under GST. This exemption from GST registration is subject to various conditions, inter alia, he is not making any Inter-State supply, he is not a non-resident taxable person, etc. 4. Due dates for filing of GSTR-1 and GSTR-3B have been announced The due dates for filing of GSTR-1 and GSTR-3B for the months of April, May and June of 2019 have been notified, which shall be as follows:
In case of GSTR-1
If the turnover of registered person is up-to Rs. 1.50 crores for the months of April to June, 2019, he shall file his GSTR-1 on a quarterly basis and the due date shall be 31st July, 2019.
If the turnover of registered person exceeds Rs. 1.50 crores for the months of April to June, 2019, he shall file his GSTR-1 on a monthly basis and the due date shall be 11th of succeeding month.
In case of GSTR-3B
Form GSTR-3B shall be filed on a monthly basis by every tax payer who is required to file GSTR-3B and due date shall be 20th of the succeeding month. 5. Option to opt for Composition Scheme Any registered person who wants to pay tax under Composition Scheme for the F.Y. 2019-20 shall file an intimation, duly signed and verified, on the GST common portal, latest March 31, 2019.
6. Last chance to avail Input Tax Credit relating to F.Y. 2017-18 The registered person can avail input tax credit of GST paid from July, 2017 to March, 2018, latest by the due date of furnishing the return for the month of March, 2019 i.e. by April 20, 2019.
In continuation to yesterday's topic i will update remaining part of GST Amendments applicable from FY 2019-20
7. Availing benefit of reduced GST Rates by real estate developers or builders The GST Council in its 33rd and 34th meeting had recommended the GST rate of 1% in case of affordable houses and 5% in other cases, without input tax credit. The promoters shall be given an one -time option to continue to pay tax at the old rates (i.e., at 8% or 12% with ITC) on ongoing projects (if construction and actual booking have started before 01-04-2019) which have not been completed by March 31, 2019.The option shall be exercised once within a prescribed time frame and where the option is not exercised within the prescribed time limit, new rates shall apply.
However, new tax rates in real estate sector are recommendations of the GST Council and date of applicability of new tax rates have not been notified yet.
8. Due date to file Form ITC-04 for Goods sent to Job-worker.
The last date to furnish a declaration in Form GST ITC-04 in respect of goods dispatched to the job-worker or received from a job-worker during the period from July, 2017 to December, 2018 is March 31, 2019
9. Benefits related to Specific Industry
(a) Money changer (Forex Dealer); or
(b) Air travel agent; or
(c) Dealer of second hand goods opting for ‘Margin Scheme’; or
(d) Taxpayer engaged in Life insurance business
Are given the option to determine the value of such supply as per rule 32 of the CGST Rules, 2017. It is suggested that the above mentioned eligible registered persons intended to determine the value of their supplies as per the valuation rules can exercise the option at the beginning of the Financial Year that is on or before April 1, 2019.
10. Availing Input tax credit by Banks, Financial Institutions or NBFC. Banks or financial institution or NBFC have been given an option to avail 50% of the eligible Input tax credit on inputs, capital goods and input services. It is suggested that this option to be exercised at the beginning of the F.Y. that is on or before April 1, 2019 as the option once exercised cannot be withdrawn during the remaining part of the financial year.
11. Following Amendment Acts made applicable from February 1, 2019
(a) CGST (Amendment) Act, 2018
(b) IGST (Amendment) Act, 2018
(c) UTGST (Amendment) Act, 2018
(d) GST (Compensation to States) Amendment Act, 2018
Some of the Major changes are as follows:
(a) Manner of utilization of ITC has been amended by inserting Section 49A in CGST Act. Now the credit of IGST needs to utilized first fully for the payment of IGST, CGST, SGST and UTGST respectively.
(b) Section 9(4) relating to reverse charge applicability on purchases made by registered person from unregistered person is replaced and now it applies to specific class.
(c) Now only e-commerce operators who are required to collect tax at source under Section 52 of the CGST Act, 2017 are mandatorily required obtain GST registration.
(d) Composition dealers as per section 10 of CGST Act, 2017 are allowed to supply services to the extent higher of 10% of the turnover in the preceding financial year or Rs. 5 lakhs.
(e) Multiple GST registrations within same state for each place of business has been allowed. The concept of business vertical is done away with.
(f) Issue of consolidated debit/credit note is allowed in respect of multiple invoices issued in a financial year rather than single debit/credit note in respect of each invoice.
(g) The receipt of payment in Indian rupees which is permitted by Reserve Bank of India for services exported out of India, will be covered in the definition of ‘export of services’ as per the IGST Act, 2017.
However, new tax rates in real estate sector are recommendations of the GST Council and date of applicability of new tax rates have not been notified yet.
8. Due date to file Form ITC-04 for Goods sent to Job-worker.
The last date to furnish a declaration in Form GST ITC-04 in respect of goods dispatched to the job-worker or received from a job-worker during the period from July, 2017 to December, 2018 is March 31, 2019
9. Benefits related to Specific Industry
(a) Money changer (Forex Dealer); or
(b) Air travel agent; or
(c) Dealer of second hand goods opting for ‘Margin Scheme’; or
(d) Taxpayer engaged in Life insurance business
Are given the option to determine the value of such supply as per rule 32 of the CGST Rules, 2017. It is suggested that the above mentioned eligible registered persons intended to determine the value of their supplies as per the valuation rules can exercise the option at the beginning of the Financial Year that is on or before April 1, 2019.
10. Availing Input tax credit by Banks, Financial Institutions or NBFC. Banks or financial institution or NBFC have been given an option to avail 50% of the eligible Input tax credit on inputs, capital goods and input services. It is suggested that this option to be exercised at the beginning of the F.Y. that is on or before April 1, 2019 as the option once exercised cannot be withdrawn during the remaining part of the financial year.
11. Following Amendment Acts made applicable from February 1, 2019
(a) CGST (Amendment) Act, 2018
(b) IGST (Amendment) Act, 2018
(c) UTGST (Amendment) Act, 2018
(d) GST (Compensation to States) Amendment Act, 2018
Some of the Major changes are as follows:
(a) Manner of utilization of ITC has been amended by inserting Section 49A in CGST Act. Now the credit of IGST needs to utilized first fully for the payment of IGST, CGST, SGST and UTGST respectively.
(b) Section 9(4) relating to reverse charge applicability on purchases made by registered person from unregistered person is replaced and now it applies to specific class.
(c) Now only e-commerce operators who are required to collect tax at source under Section 52 of the CGST Act, 2017 are mandatorily required obtain GST registration.
(d) Composition dealers as per section 10 of CGST Act, 2017 are allowed to supply services to the extent higher of 10% of the turnover in the preceding financial year or Rs. 5 lakhs.
(e) Multiple GST registrations within same state for each place of business has been allowed. The concept of business vertical is done away with.
(f) Issue of consolidated debit/credit note is allowed in respect of multiple invoices issued in a financial year rather than single debit/credit note in respect of each invoice.
(g) The receipt of payment in Indian rupees which is permitted by Reserve Bank of India for services exported out of India, will be covered in the definition of ‘export of services’ as per the IGST Act, 2017.
Using the Presumptive taxation Scheme Presumptive taxation scheme has been made available to professionals listed u/s 44ADA. This scheme will presume your income to be 50% of your gross receipts, thus you would not be to claim any further business expenses while using this scheme.
This scheme is available for professionals having gross receipts up to Rs 50 lakhs.
Apart from presuming your income, this scheme also waives the taxpayer from maintaining any books of accounts.
II. Reporting the income as business income i.e. without using the presumptive taxation scheme
Freelancing income can be considered as your business income & this will have its own merits.
Often the freelancers earn revenue & consider the revenue as their income, while they must have incurred certain amount to provide the services, they are engaged in. Having business as a source of your income, one would be able to deduct the expenses.
Most common expenses could be:
Depreciation on assets
Office Overheads
Office Rent
Client meeting expenses
Contracting costs etc.
Important thing to note here is, personal expenses cannot be claimed while computing the freelancing income.
Important note: One can either use one of the above two reporting under income tax. So, it is pertinent to determine, which one of the above would be beneficial for your freelancing business.
III. Investing the right way & claiming deductions
One of the most important steps towards saving tax is “Investing Right”, this will not only help you save tax, you will also have some portion of your money saved as Investments
Various deductions are available under Income tax of which most popular ones are Deductions u/s 80C, 80D, 80CCD, 80GG etc.
IV. Determining if GST registration is required
Apart from saving taxes under Income tax, a freelancer must also determine, if he/she is required to get the business registered under GST. This should be done proactively, to avoid any late fees or interest.
V. Filing correctly & in time to save Interest & penalties
One of the important ways to save money while filing taxes is to file correct and to file in time. Doing so, you will save unnecessary costs in the form of interest & penalties.
One must take care that:
They use the correct ITR form
Pay advance taxes, if applicable
Consider all sources of income & calculate accurately.
TDS credits are taken appropriately
Claim proper deductions
Determine if tax audit is applicable
Concluding, as you can see, there are a number of things which must fall right to be tax compliant & save tax.
The most important thing, is to find the right mix. Therefore, a lot will depend upon various other factors such as the other income sources of the Individual, eligibility of deductions, applicability of tax audit, importance of book-keeping for the freelancer etc.
This scheme is available for professionals having gross receipts up to Rs 50 lakhs.
Apart from presuming your income, this scheme also waives the taxpayer from maintaining any books of accounts.
II. Reporting the income as business income i.e. without using the presumptive taxation scheme
Freelancing income can be considered as your business income & this will have its own merits.
Often the freelancers earn revenue & consider the revenue as their income, while they must have incurred certain amount to provide the services, they are engaged in. Having business as a source of your income, one would be able to deduct the expenses.
Most common expenses could be:
Depreciation on assets
Office Overheads
Office Rent
Client meeting expenses
Contracting costs etc.
Important thing to note here is, personal expenses cannot be claimed while computing the freelancing income.
Important note: One can either use one of the above two reporting under income tax. So, it is pertinent to determine, which one of the above would be beneficial for your freelancing business.
III. Investing the right way & claiming deductions
One of the most important steps towards saving tax is “Investing Right”, this will not only help you save tax, you will also have some portion of your money saved as Investments
Various deductions are available under Income tax of which most popular ones are Deductions u/s 80C, 80D, 80CCD, 80GG etc.
IV. Determining if GST registration is required
Apart from saving taxes under Income tax, a freelancer must also determine, if he/she is required to get the business registered under GST. This should be done proactively, to avoid any late fees or interest.
V. Filing correctly & in time to save Interest & penalties
One of the important ways to save money while filing taxes is to file correct and to file in time. Doing so, you will save unnecessary costs in the form of interest & penalties.
One must take care that:
They use the correct ITR form
Pay advance taxes, if applicable
Consider all sources of income & calculate accurately.
TDS credits are taken appropriately
Claim proper deductions
Determine if tax audit is applicable
Concluding, as you can see, there are a number of things which must fall right to be tax compliant & save tax.
The most important thing, is to find the right mix. Therefore, a lot will depend upon various other factors such as the other income sources of the Individual, eligibility of deductions, applicability of tax audit, importance of book-keeping for the freelancer etc.
We are posting an article for individuals who are getting interest from banks for their fixed deopsits
We invest money in fixed deposits to get better returns. If you go through the instructions mentioned on your FD certificate, it usually menti ons: “If the depositor is not liable to pay income tax and the interest to be paid in a financial year does not exceed the maximum amount which is not chargeable to income tax, the depositor may submit a declaration in Form No. 15G / 15H so that income tax is not deducted at source.” What does the statement mean?
The below article provides a comprehensive picture of what does 'Form No. 15G' and 'Form No. 15H' mean.
Banks normally ask depositors to submit Form No. 15G and Form No. 15H each year. There are different rules as to who can submit Form No. 15G and Form No. 15H.
Form No. 15G and Form No. 15H are self-declaration forms required to be furnished by the assessee to his banker for nil deduction / lower deduction of TDS (tax deducted at source) on interest on fixed deposit.
Form 15G and Form No. 15H is a self-declaration, which is provided by a person resident in India (not being a company or firm) to their deductor that the tax on his estimated total income for the previous year, will be nil. The duty to submit these forms with assessee before end of the financial year or first payment of interest whichever is earlier.
The declaration in writing should be collected by the deductor in duplicate.
Form No. 15H: For senior citizens
Form No. 15G: For other than senior citizens
Previous year income should not be taxable
No TDS is deducted by banks on interest earned in saving bank accounts and recurring deposit accounts. Interest on fixed deposits is subject to deduction of tax as per income tax rules.
According to Section 197A of the Income Tax Act, 1961, an individual who is resident in India and whose estimated total income of the previous year is less than the minimum liable to income-tax will receive interest on securities, dividends and other interest without deduction of tax at source. The facility of claiming payments of interest on securities, dividends, etc., under section 197A is available only in the case of individuals who are resident in India. Accordingly, it is not permissible for Hindu undivided families and other categories of taxpayers to claim payments of interest on securities, dividends, etc., without deduction of tax at source on furnishing the declaration in Form No. 15G or 15H.
All banks and financial institutions will deduct TDS on all interest payments exceeding Rs. 10,000 on fixed deposits in a financial year. If a customer receives more than Rs. 10,000 per annum on his FDs as interest from a bank, the bank deducts tax on such income arising in the hands of the customer. The tax deducted is directly paid to the government on the behalf of the customer.
The bank issues a TDS Certificate also called Form 16A which mentions the details of the TDS payment with the government. The bank will deduct tax at source once the amount of interest to be credited in respect of all the fixed deposits taken together exceeds Rs. 10,000 in a financial year. This limit of Rs. 10,000 is applicable for each branch of a bank and not for all the branches of a bank taken together. So each branch of the bank will see whether the interest for the whole year on all the FDs exceed the threshold of Rs. 10,000.
Banks are not required to deduct any TDS on interest credited on your savings bank account even the amount of interest may be very substantial.
In case of FDs made for longer duration where the interest will be paid to you only on maturity, the bank will deduct tax at source on the interest accrued for the year even though no interest in fact has been paid to you.
Form No 15G: Only a person who is resident in India can submit Form No. 15G. So a NRI cannot submit this form. Any person other than a company can submit Form No. 15 G. So any individual, HUF, Trust, Association of Persons or Body of Individuals can submit Form No. 15G. Form 15G is submitted by individuals who are less than 60 years of age.
Form No. 15H: Any resident Individual who is above sixty years
The below article provides a comprehensive picture of what does 'Form No. 15G' and 'Form No. 15H' mean.
Banks normally ask depositors to submit Form No. 15G and Form No. 15H each year. There are different rules as to who can submit Form No. 15G and Form No. 15H.
Form No. 15G and Form No. 15H are self-declaration forms required to be furnished by the assessee to his banker for nil deduction / lower deduction of TDS (tax deducted at source) on interest on fixed deposit.
Form 15G and Form No. 15H is a self-declaration, which is provided by a person resident in India (not being a company or firm) to their deductor that the tax on his estimated total income for the previous year, will be nil. The duty to submit these forms with assessee before end of the financial year or first payment of interest whichever is earlier.
The declaration in writing should be collected by the deductor in duplicate.
Form No. 15H: For senior citizens
Form No. 15G: For other than senior citizens
Previous year income should not be taxable
No TDS is deducted by banks on interest earned in saving bank accounts and recurring deposit accounts. Interest on fixed deposits is subject to deduction of tax as per income tax rules.
According to Section 197A of the Income Tax Act, 1961, an individual who is resident in India and whose estimated total income of the previous year is less than the minimum liable to income-tax will receive interest on securities, dividends and other interest without deduction of tax at source. The facility of claiming payments of interest on securities, dividends, etc., under section 197A is available only in the case of individuals who are resident in India. Accordingly, it is not permissible for Hindu undivided families and other categories of taxpayers to claim payments of interest on securities, dividends, etc., without deduction of tax at source on furnishing the declaration in Form No. 15G or 15H.
All banks and financial institutions will deduct TDS on all interest payments exceeding Rs. 10,000 on fixed deposits in a financial year. If a customer receives more than Rs. 10,000 per annum on his FDs as interest from a bank, the bank deducts tax on such income arising in the hands of the customer. The tax deducted is directly paid to the government on the behalf of the customer.
The bank issues a TDS Certificate also called Form 16A which mentions the details of the TDS payment with the government. The bank will deduct tax at source once the amount of interest to be credited in respect of all the fixed deposits taken together exceeds Rs. 10,000 in a financial year. This limit of Rs. 10,000 is applicable for each branch of a bank and not for all the branches of a bank taken together. So each branch of the bank will see whether the interest for the whole year on all the FDs exceed the threshold of Rs. 10,000.
Banks are not required to deduct any TDS on interest credited on your savings bank account even the amount of interest may be very substantial.
In case of FDs made for longer duration where the interest will be paid to you only on maturity, the bank will deduct tax at source on the interest accrued for the year even though no interest in fact has been paid to you.
Form No 15G: Only a person who is resident in India can submit Form No. 15G. So a NRI cannot submit this form. Any person other than a company can submit Form No. 15 G. So any individual, HUF, Trust, Association of Persons or Body of Individuals can submit Form No. 15G. Form 15G is submitted by individuals who are less than 60 years of age.
Form No. 15H: Any resident Individual who is above sixty years
of age or completes sixty years during the financial year can submit Form No. 15H provided his tax liability on the basis of his estimated income is nil for the financial year.
Please ensure to submit your PAN details to the bank while submitting the Form No. 15G or 15H. In case you fail to include your PAN number to the bank, the bank will deduct TDS @ 20% against the applicable rate of 10% even if you have submitted Form No. 15G and 15H. Please take an acknowledgement from the bank for Form No. 15 G or 15H while submitting it.
The Form No. 15G or 15H as the case may be, should be submitted at the beginning of the year so as to avoid a situation where bank has already deducted the tax before you submit the form. However in case the bank deducts the tax in spite of the fact that you have submitted the form or before you actually submit the same, the bank will not refund the tax already deducted, as the bank would have already deposited the tax with the government. In such a situation the only option available with you is to file your income tax return and claim the amount of TDS a refund.
Form 15G and Form 15H have the validity of only one financial year. These forms are valid only for the financial year in which you have furnished these forms. If you want to apply for nil TDS in the new financial year, then you will have to resubmit these forms. Form 15H or 15G are meant to prevent TDS and not to avoid tax or file your tax return. You may be required to file your tax return if your total income before the deductions is above the basic tax exemption limit.
Please ensure to submit your PAN details to the bank while submitting the Form No. 15G or 15H. In case you fail to include your PAN number to the bank, the bank will deduct TDS @ 20% against the applicable rate of 10% even if you have submitted Form No. 15G and 15H. Please take an acknowledgement from the bank for Form No. 15 G or 15H while submitting it.
The Form No. 15G or 15H as the case may be, should be submitted at the beginning of the year so as to avoid a situation where bank has already deducted the tax before you submit the form. However in case the bank deducts the tax in spite of the fact that you have submitted the form or before you actually submit the same, the bank will not refund the tax already deducted, as the bank would have already deposited the tax with the government. In such a situation the only option available with you is to file your income tax return and claim the amount of TDS a refund.
Form 15G and Form 15H have the validity of only one financial year. These forms are valid only for the financial year in which you have furnished these forms. If you want to apply for nil TDS in the new financial year, then you will have to resubmit these forms. Form 15H or 15G are meant to prevent TDS and not to avoid tax or file your tax return. You may be required to file your tax return if your total income before the deductions is above the basic tax exemption limit.
Presumptive taxation scheme and eligibility ( Business )
If an Assessee is having Income from Business they can opt for Presumptive Taxation Scheme (if Turnover / Gross Receipts is upto Rs.2 crore) under Section – 44AD
As per Section 44AD – Presumptive PGBP Income for business is calculated in the following manner:
• Turn Over / Gross Receipts * 8%
/ 6%
• Eligible Assessee is required to pay Advance Tax on or before 15th March of FY.
• If Section 44AD applicable Assessee cannot claim expenses
• Assessee no need to maintain Books of Accounts
If an Assessee is having Income from Business they can opt for Presumptive Taxation Scheme (if Turnover / Gross Receipts is upto Rs.2 crore) under Section – 44AD
As per Section 44AD – Presumptive PGBP Income for business is calculated in the following manner:
• Turn Over / Gross Receipts * 8%
/ 6%
• Eligible Assessee is required to pay Advance Tax on or before 15th March of FY.
• If Section 44AD applicable Assessee cannot claim expenses
• Assessee no need to maintain Books of Accounts
Advantages of Presumptive taxation Schemes are Assessee will pay Nominal taxes even though they had more Profits
A. Due dates for Compliances under GST
11-04-19- Due date for filing GSTR-1 for m/o March 19 -> Applicable for taxpayers with Annual Aggregate turnover Above Rs. 1.50/- Crore or opted to file monthly Return (Rs. One Crore Fifty Lacs) only.
30-04-19- Due date for filing GSTR-1 for March 19 Quarter -> Applicable for taxpayers with Annual Aggregate turnover LESS than Rs. 1.50/- Crore (Rs. One Crore Fifty Lacs) only.
10-04-19- Due date for filing GSTR-7 (to be filed by the persons who is required to deduct TDS under GST for the month of March 19.
10-04-19- Due date for filing GSTR-8 (to be filed by the by the e-commerce operators required to deduct TDS under GST for the m/o March 19.
20-04-19- Due date for filing GSTR-5 & 5A (to be filed by the Non-Resident taxable person & OIDAR for the m/o March 19.
13-04-2019- Due date for filing GSTR-6 (to be filed by the Input Service Distributor for the m/o March 19.
18-04-2019- Quarterly return GSTR – 4 for taxpayers opting for Composition Scheme from the period starting from Jan 2019 to March 2019.
20-04-2019- GSTR-3B for the m/o March 19. Pay due Tax till this date.
RFD-10:- Eighteen months after end of the quarter for which refund is to be claimed
30-04-19 – Due date of TRAN-2 is extended for certain taxpayers who could not complete filing due to tech glitch.
B. Due dates for Compliance under Income tax
07-04-19- Due date for deposit of tax deducted /collected at source by an office of the government for m/o March 19. However, all sum deducted by an office of the government shall be paid to credit of Central Government on the same day where tax is paid without production of an Income-tax Challan
30-04-19 – Due date for deposit of Tax deducted by an assessee other than an office of the Government for the month of March 19.
14-04-19- Due date for issue of TDS Certificate for tax deducted u/s 194-IA (TDS on Immovable property) in m/o Feb 19
14-04-19 – Due date for issue of TDS Certificate for tax deducted under section 194-IB (TDS on Certain Rent payment) in m/o Feb 19
30-04-19 -Due date for furnishing of Form 24G by an office of Government where TDS for m/o Feb 19 has been paid without production of a challan
30-04-19 -Due date for furnishing of challan-cum-statement in respect of tax deducted u/s 194-IA in month of March 19
30-04-19 -Due date for furnishing of challan-cum-statement in respect of tax deducted u/s 194-IB in month of March 19
C. Due dates for Compliances under Companies Act
21-04-2019- Form DPT-3 – Onetime Return For Disclosure Of Details Of Outstanding Money Or Loan Received By Company But Not Considered As Deposits In Terms Of Rule 2(1)(C) Of The Companies (Acceptance Of Deposits) Rules, 2014 (New e-form not yet deployed by Ministry (ROC)
25-04-19- INC- 22A- Filing of the particulars of the Company & its registered office. (by every company incorporated on or before 31.12.17)- Penalty after due date is Rs. 10,000/-
30-04-19 – Every Person holding DIN as on 31.03.2019 (including Directors having disqualified DIN). Penalty after due date is Rs. 5,000/-
D. Due dates for Compliances under ESI, PF Acts
15-04-2019- PF Payment for m/o March 19.
15-04-2019- ESIC Payment for m/o March 19
25-04-19 – PF Return filling for March 19 (including pension & Insurance scheme forms
11-04-19- Due date for filing GSTR-1 for m/o March 19 -> Applicable for taxpayers with Annual Aggregate turnover Above Rs. 1.50/- Crore or opted to file monthly Return (Rs. One Crore Fifty Lacs) only.
30-04-19- Due date for filing GSTR-1 for March 19 Quarter -> Applicable for taxpayers with Annual Aggregate turnover LESS than Rs. 1.50/- Crore (Rs. One Crore Fifty Lacs) only.
10-04-19- Due date for filing GSTR-7 (to be filed by the persons who is required to deduct TDS under GST for the month of March 19.
10-04-19- Due date for filing GSTR-8 (to be filed by the by the e-commerce operators required to deduct TDS under GST for the m/o March 19.
20-04-19- Due date for filing GSTR-5 & 5A (to be filed by the Non-Resident taxable person & OIDAR for the m/o March 19.
13-04-2019- Due date for filing GSTR-6 (to be filed by the Input Service Distributor for the m/o March 19.
18-04-2019- Quarterly return GSTR – 4 for taxpayers opting for Composition Scheme from the period starting from Jan 2019 to March 2019.
20-04-2019- GSTR-3B for the m/o March 19. Pay due Tax till this date.
RFD-10:- Eighteen months after end of the quarter for which refund is to be claimed
30-04-19 – Due date of TRAN-2 is extended for certain taxpayers who could not complete filing due to tech glitch.
B. Due dates for Compliance under Income tax
07-04-19- Due date for deposit of tax deducted /collected at source by an office of the government for m/o March 19. However, all sum deducted by an office of the government shall be paid to credit of Central Government on the same day where tax is paid without production of an Income-tax Challan
30-04-19 – Due date for deposit of Tax deducted by an assessee other than an office of the Government for the month of March 19.
14-04-19- Due date for issue of TDS Certificate for tax deducted u/s 194-IA (TDS on Immovable property) in m/o Feb 19
14-04-19 – Due date for issue of TDS Certificate for tax deducted under section 194-IB (TDS on Certain Rent payment) in m/o Feb 19
30-04-19 -Due date for furnishing of Form 24G by an office of Government where TDS for m/o Feb 19 has been paid without production of a challan
30-04-19 -Due date for furnishing of challan-cum-statement in respect of tax deducted u/s 194-IA in month of March 19
30-04-19 -Due date for furnishing of challan-cum-statement in respect of tax deducted u/s 194-IB in month of March 19
C. Due dates for Compliances under Companies Act
21-04-2019- Form DPT-3 – Onetime Return For Disclosure Of Details Of Outstanding Money Or Loan Received By Company But Not Considered As Deposits In Terms Of Rule 2(1)(C) Of The Companies (Acceptance Of Deposits) Rules, 2014 (New e-form not yet deployed by Ministry (ROC)
25-04-19- INC- 22A- Filing of the particulars of the Company & its registered office. (by every company incorporated on or before 31.12.17)- Penalty after due date is Rs. 10,000/-
30-04-19 – Every Person holding DIN as on 31.03.2019 (including Directors having disqualified DIN). Penalty after due date is Rs. 5,000/-
D. Due dates for Compliances under ESI, PF Acts
15-04-2019- PF Payment for m/o March 19.
15-04-2019- ESIC Payment for m/o March 19
25-04-19 – PF Return filling for March 19 (including pension & Insurance scheme forms
Following are the five transactions that Income Tax Department doesn’t want you to do.
1) Don’t accept cash of Rs 2,00,000 or more in aggregate from a single person in a day or for one or more transactions relating to one event or occasion.
2) Don’t receive or repay specified sum exceeding Rs 20,000 or more in cash for transfer of immovable property and use account payee cheque or account payee demand draft or use of electronic clearing system through a bank account.
3) Don’t pay more than Rs 10,000 in cash relating to expenditure of business/profession.
4) Don’t donate in excess of Rs 2,000 in cash to a registered trust or political party.
5) Don’t pay health insurance premiums in cash.
1) Don’t accept cash of Rs 2,00,000 or more in aggregate from a single person in a day or for one or more transactions relating to one event or occasion.
2) Don’t receive or repay specified sum exceeding Rs 20,000 or more in cash for transfer of immovable property and use account payee cheque or account payee demand draft or use of electronic clearing system through a bank account.
3) Don’t pay more than Rs 10,000 in cash relating to expenditure of business/profession.
4) Don’t donate in excess of Rs 2,000 in cash to a registered trust or political party.
5) Don’t pay health insurance premiums in cash.
Let us study these transactions in detail:
1) Don’t accept cash of Rs 2,00,000 or more in aggregate from a single person in a day or for one or more transactions relating to one event or occasion. Instead of cash, you are advised to use an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account for such transactions. However, the said restriction shall not apply to government, any banking company, post office savings bank, co-operative bank or a person notified by the Central Government. Section 271DA of the Income Tax Act provides for levy of penalty on a person who receives a sum in contravention of the provisions of section 269ST. The penalty shall be equal to the amount of such receipt. However, the penalty shall not be levied if the person proves that there were good and sufficient reasons for such contravention.
2) Don’t receive or repay specified sum exceeding Rs 20,000 or more in cash for transfer of immovable property and use account payee cheque or account payee demand draft or use of electronic clearing system through a bank account. “Specified sum” means any sum of money receivable, whether as advance or otherwise, in relation to transfer of an immovable property, whether or not the transfer takes place. Contravention of the provisions of section 269SS will attract penalty under section 271D. Penalty under section 271D shall be levied of an amount equal to loan or deposit taken or accepted.
3) Don’t pay more than Rs 10,000 in cash relating to expenditure of business/profession. If such expenses exceeding Rs 10,000 are made in any mode, other than by an account payee cheque drawn on a bank, or account payee bank draft, or use of electronic clearing system through a bank account, no deduction shall be allowed in respect of such expenditure in the profit and loss account.
4) Don’t donate in excess of Rs 2,000 in cash to a registered trust or political party. Not only you won’t be able to claim deductions under section 80G of the Income Tax Act for such donations, but appropriate actions would be initiated against the trust or political party for encouraging money laundering.
5) Don’t pay health insurance premiums in cash. If you make any payment in cash on account of premium on health insurance facilities, you won’t get deductions under Section 80D of the Income Tax Act.
The Government is time and again giving us opportunities to declare the relevant information suo motto in the ITR forms. For eg: in the recently notified ITR Forms for the AY 2019-20, one important declaration asked by the government is that of the holding of shares in unlisted companies. The Government is thus trying to co relate all the data and have access to all the information about a particular assessee, which is in a way a very good initiative to curb Black Money and Benami transactions.
Also, the Government has these days become very interactive and keeps issuing Rules and Warnings to the assessee’s to not perform certain transactions which might land them into
unnecessary trouble. We therefore need to take care of such warnings and avoid such transactions to avoid future hassles.
So, it is advisable for your own good not to violate the above rules, as the Income Tax Department is seeking information regarding such violations, black money or benami transactions. Also, all the tax departments are now being centralized and there is easy flow of information and assessee data from one department to another, because everything is online.
1) Don’t accept cash of Rs 2,00,000 or more in aggregate from a single person in a day or for one or more transactions relating to one event or occasion. Instead of cash, you are advised to use an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account for such transactions. However, the said restriction shall not apply to government, any banking company, post office savings bank, co-operative bank or a person notified by the Central Government. Section 271DA of the Income Tax Act provides for levy of penalty on a person who receives a sum in contravention of the provisions of section 269ST. The penalty shall be equal to the amount of such receipt. However, the penalty shall not be levied if the person proves that there were good and sufficient reasons for such contravention.
2) Don’t receive or repay specified sum exceeding Rs 20,000 or more in cash for transfer of immovable property and use account payee cheque or account payee demand draft or use of electronic clearing system through a bank account. “Specified sum” means any sum of money receivable, whether as advance or otherwise, in relation to transfer of an immovable property, whether or not the transfer takes place. Contravention of the provisions of section 269SS will attract penalty under section 271D. Penalty under section 271D shall be levied of an amount equal to loan or deposit taken or accepted.
3) Don’t pay more than Rs 10,000 in cash relating to expenditure of business/profession. If such expenses exceeding Rs 10,000 are made in any mode, other than by an account payee cheque drawn on a bank, or account payee bank draft, or use of electronic clearing system through a bank account, no deduction shall be allowed in respect of such expenditure in the profit and loss account.
4) Don’t donate in excess of Rs 2,000 in cash to a registered trust or political party. Not only you won’t be able to claim deductions under section 80G of the Income Tax Act for such donations, but appropriate actions would be initiated against the trust or political party for encouraging money laundering.
5) Don’t pay health insurance premiums in cash. If you make any payment in cash on account of premium on health insurance facilities, you won’t get deductions under Section 80D of the Income Tax Act.
The Government is time and again giving us opportunities to declare the relevant information suo motto in the ITR forms. For eg: in the recently notified ITR Forms for the AY 2019-20, one important declaration asked by the government is that of the holding of shares in unlisted companies. The Government is thus trying to co relate all the data and have access to all the information about a particular assessee, which is in a way a very good initiative to curb Black Money and Benami transactions.
Also, the Government has these days become very interactive and keeps issuing Rules and Warnings to the assessee’s to not perform certain transactions which might land them into
unnecessary trouble. We therefore need to take care of such warnings and avoid such transactions to avoid future hassles.
So, it is advisable for your own good not to violate the above rules, as the Income Tax Department is seeking information regarding such violations, black money or benami transactions. Also, all the tax departments are now being centralized and there is easy flow of information and assessee data from one department to another, because everything is online.