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2017
  • The government has introduced new section 269ST in Income Tax Act 1961 for prohibition of acceptance of cash of Rs 2 lakh and more.
  • For cash transactions above that limit, the receiver will need to pay a penalty equivalent to the amount of transaction. There are no exceptions to this.
  • You cannot gift cash to close relatives (children, parents and spouse) above Rs 2 lakh and even on the occasion of marriage; you cannot accept a higher amount of cash as a gift.
  • At present, there are few other areas which have either a cap on cash transaction or a complete ban. Here are those transactions and the penalty that may attract for flouting the rules...

2017
  • As per section 139(1) of the Income Tax Act, 1961 in the country, individuals whose total income during the previous year exceeds the maximum amount not chargeable to tax, should file their income tax returns (ITR).
  • The process of electronically filing income tax returns is known as e-filing. You can either seek professional help or file your returns yourself from the comfort of your home by registering on the income tax department website or other websites. The due date for filing tax returns (physical or online), is July 31st.

Who should e-file income tax returns?

Online filing of tax returns is easy and can be done by most assessees.
  • Assessee with a total income of Rs. 5 Lakhs and above.
  • Individual/HUF resident with assets located outside India.

2017
  • The government has prescribed an online procedure so that people can link their accounts easily. But several taxpayers have been facing problems in linking both accounts due to difference in spelling of their names in each account. The problem is so grave that out of 25 crore PAN accounts, only 1 crore have been linked to Aadhaar so far. If you have been facing the same problem, you should read further because the government has listened to you and come up with alternate ways to do this.
  • With the linking of PAN with Aadhaar being made mandatory, individuals can log on to e-filing website of the income tax department or NSDL but the seeding cannot happen if the name is differently spelt in the two cards — like use of full name in PAN and initials in Aadhaar. In such cases, government has allowed a simple uploading of a scanned copy of PAN on the Aadhaar website.
  • In case the taxpayer is unable to link PAN with Aadhaar because of discrepancy in name, the government has advised them to log in to the Aadhaar website, request for a name change and upload a scanned copy of PAN card as supported proof. This is the simplest way to update name in Aadhaar and only the registered mobile number has to be functional.

2017
  • In the beginning of every fiscal year, employees are asked for details like their investment and other income by their employer to arrive at the annual tax liability of an employee. This annual exercise also helps you do tax planning for the year. Based on the declaration, your employer calculates TDS or tax deducted at source. The employer will deduct tax from salary and deposit it with the tax authorities. Starting April 1, 2017, some income tax laws have changed.
  • Here are changes in tax laws one should be aware before submitting tax declaration:
    • The tax rate on income between Rs. 2.5 lakh and Rs. 5 lakh has been halved to 5 per cent from 10 per cent. However, rebate under Section 87A gets reduced from Rs. 5,000 to Rs. 2,500. And no rebate will be applicable for taxpayers having income above Rs. 3.5 lakh.

2017
Important amendments in Income Tax Act which have become effective from the new F.Y. 2017-18 are as under.
  • Reduced Tax Rate : The new Finance Bill has brought much relief to the middle class by effectively reducing taxability of salaried individuals in the income bracket Rs. 2.5 lakh to Rs. 5 lakh. In the F.Y. 2015-16, the tax rate for this income group was 10%. This will get reduced to 5% in the upcoming F.Y. All other income groups will also receive a uniform tax benefit of Rs. 12,500.
  • Reduction in tax rebate : Although middle class salaried people received some tax benefits, the government has cut down its losses by halving the rebate from Rs. 5,000 to Rs. 2,500 for assessed with income up to Rs. 3.5 lakh. So, the effective tax liability even without claiming any chapter VI deductions will still be zero for individuals with income up to Rs. 3 lakh & Rs. 2,500 for those with income between Rs. 3 & Rs. 3.5 lakh.

2017
  • For the Financial year 2017-18 department has revised TDS rates.
  • Please find the attached file of revised TDS rates.

Financial Management