Skip to main content

CBDT's clarification related to issue of TDS certificates..

The tax department has issued clarifications concerning the difficulty of certificates for a lower deduction, collection of TDS, TCS.

To mitigate the hardships of taxpayers, the Central Board of Direct Taxes (CBDT) on April 9, 2020 provided clarification on orders under Section 119 of the Income-Tax Act, 1961, concerning the difficulty of certificates for lower deduction/collection of TDS/TCS. Earlier on April 4, 2020* (see the reference below), thanks to outbreak of the Covid-19 pandemic, and so as to mitigate the hardships of taxpayers, the CBDT had issued the directions/clarifications by exercise of its power u/s 119 of the Income-tax Act, 1961. The recent clarifications are in response to certain representations made by the taxpayers and people who deduct TDS.

Issuance of validity period of lower/nil deduction/collection certificate for FY 2019-20

CBDT stated, in the order dated March 31 (see the reference below), the lower/nil deduction/ collection certificates are going to be valid for the actual period that these were issued for FY 2019-20 and also for an extra period from April 1 to June 30 for FY 2020-21 subject to conditions as mentioned within the order dated March 31.

For example, if a certificate was issued from a period from 1.10.2019 to 15.12.2019, an equivalent are going to be valid for FY 2019-20 for the amount from 1.10.2019 to 15.12.2019 and for FY 2020-21, an equivalent shall be valid from 01.04.2020 to 30.06.2020 subject to conditions mentioned within the Order dated 30.03.2020.

Threshold/transaction limit mentioned in lower/nil deduction/collection certificate issued for financial year 2019-20.

For the aim of Para 2 (a) and a couple of (b) of the order dated March 31 (see the reference below), the lower/nil deduction/ collection certificates issued for FY 2019-20, are going to be taken fresh for period from 01.04.2020 to 30.06.2020 for FY 2020-21 and therefore the amount of threshold limit are going to be an equivalent as was assigned for these certificates for FY 2019-20 subject to conditions mentioned within the Order dated 30.03.2020.

Issuance of approval and communication of lower/nil deduction/collection certificate

Here, CBDT has clarified that official emails or other transmission could also be employed by field authorities of tax Department for internal approval for issue of lower/nil deduction/collection certificates and for communication of an equivalent .

Issuance of new/different TAN mentioned for lower/nil deduction/collection application for FY 2020-21

CBDT stated that, “In case the payee or buyer/licensee/lessee taxpayer had a certificate for a lower deduction for FY 2019-20 and an application has been made for FY 2020-21 for a new/different TAN mentioned within the application, the relief as provided in Para 2(a) and 2(b) of the order dated March 31 (see the reference below) shall not apply to such cases and that they need to apply afresh as per the procedure.

Similarly, if the rates of TDS/TCS mentioned in old certificates are higher and therefore the taxpayer wants a revision of the rates in sight of the impact of COVID-19 outbreak on its business, the relief as provided in Para 2(a) and 2(b) of the order dated March 31 (see the reference below) shall not apply to such cases and that they will need to follow the procedure mentioned within the annexure of the order and apply afresh.

The CBDT had also in an earlier direction so as to mitigate the hardships of small taxpayers, had decided that if an individual, had submitted valid Forms 15G and 15H to the Banks or other financial institutions for F.Y. 2019-20, then these Forms would be valid up to 30.06.2020, this may safeguard the tiny tax payers against TDS where there's no liabilities.

Reference: 
1.) Order u/s 119 of the Income-tax Act, 1961 on issue of certificates for lower rate/nil deduction/collection of TDS or TCS u/s 195, 197 and 206C(9) of the Act for Financial Year 2019-20​

2.) Order u/s 119 of the Income-tax Act, 1961 regarding submission of Form 15G and 15H for Financial Year-2020-21​


Know about us - https://thetaxsupport.com
You can find more articles on at https://thetaxsupport.com/blog
You can find tutorial videos on at https://www.youtube.com/c/vipinsanger
Labels:
Location: New Delhi, Delhi, India

Comments

Post a Comment

Popular posts from this blog

4 Quick Tips to Stop Overspending..!!

The Tax Support Y ou may are during a situation where you've planned to save lots of money rather than overspending it. you'll have planned to shop for only what's necessary, stop eating out and control the urge to online shopping. Unfortunately, at the top of the month, you've ended up spending quite what you've thought you'd. Stopping overspending isn't as easy because it seems to be and if you actually want to save lots of money, read on to understand four quick and straightforward tips and tricks. Why shouldn't you overspend? In spite of the very fact that overspending may be a 'subjective' term, most folks tend to spend quite what we should always. Though it's going to not be easy to believe that you're overspending, the sooner you realize the very fact , the better it gets in controlling your urge to spend more. If you're one among those that purchase items because they're hooked in to those, ask yourself whether ...
Post a Comment
Read more

Here's All You Need To Know About Indian Digital Tax

The Covid-19 outbreak has compelled businesses to transcend from traditional to digital models of work. With business models evolving on account of mass digitization, the complexities from a regulatory and taxation standpoint have only amplified. The advent and access to technology have enabled businesses to carry on business-as-usual with minimal physical presence. Unsurprisingly, India has the second-largest online users in the world, with over 560 million internet users, and hence, from the viewpoint of its tax revenue base, digital businesses could not be overlooked. However, as is the case in other jurisdictions, Indian tax laws were suited for conventional business models such as brick and mortar stores and thus in dire need of an overhaul. Recent Amendments To ensure that value created digitally is appropriately taxed; two significant amendments were introduced in Indian taxation laws in the recent past – The “Equalization Levy” – a tax aimed at foreign digital...
Post a Comment
Read more

ITR Due Dates may extend till September 2020

The government is considering a proposal to extend the deadline for filing personal income tax returns to September 30 from July 31 because of the lockdown. The last date for paying advance tax has already been extended till June 30 from March 31. A senior finance ministry official said the CBDT was considering an extension of the last date to file personal income tax returns to September 30 from July 31. Besides the date for advance tax, the government has extended the deadline for employers to issue TDS certificates, or Form 16, to June 30. Tax practioners said it would be difficult for employees to file their income tax returns by July 31 — the normal deadline for most individuals to file ITRs — if they get their Form -16 (TDS certificates) as late as June 30. So, it is likely that the deadline of July 31 to file ITRs would also be extended. According to the income tax laws, the last date for filing TDS returns for an employer is May 31 and Form 16 has to b...
Post a Comment
Read more