the Government has rolled out a new annual information statement expanding the scope of current Form 26-AS with the inclusion of various information categories like interest, mutual fund transactions, insurance, dividends, etc.
The government is making all the efforts to promote electronic transactions by providing various tax incentives and discouraging cash transactions by imposing various penalties or increasing tax compliances for cash transactions.
If payment is made to the advertising agency then TDS should be deducted u/s 194C @ 1%/2% irrespective of written contract.
Major changes in TDS & TCS provisions introduced by the Finance Act, 2021 that are becoming applicable with effect from 1st July 2021.
Payment made by INDIAN residents to either foreign non-resident distributor or manufacturer / supplier for further sale or use of such software through distribution agreements is not a royalty for use of copyright in the computer software. Hence are not liable to TDS under section 195 of Income tax act.
Under Section 206C, Sub-section (1H) has been inserted vide Finance Act, 2020. As per sub-section (1H), every seller of goods, who receives consideration or aggregate of consideration for sale of goods exceeding INR 50 Lacs in any year, shall collect TCS @ 0.1% of sales consideration from buyer for amount exceeding INR 50 Lacs.
Section 194J contains provisions related to deduction of TDS on professional Fee and Technical fees which requires deduction of TDS @ 10%. However, the Finance Act, 2020 reduced the rate of TDS from 10% to 2% for few payments under section 194J.
CBDT reduce the TDS rate for fy 2020-21 & TCS rate for fy 2020-21 by 25% for the non-salaried defined payments made to residents for the period of 14th May, 2020 to March 31st, 2021.
According to the Income Tax Act provisions, Tax deducted at Sources (TDS) deduction is mandatory while making payments. Application for lower TDS deduction rates can be made from 28th February 2020. The taxpayer who is making the payment, has to deduct the TDS and deposit it to the Income Tax Department before the assigned due date of depositing TDS. At times TDS is deducted from the total revenue/ inpayer i.e receiver whereas the taypayer’s total tax liability is computed on the profit of that financial year. It is in accordance with the prevailing Income Tax Rates/Rules, which may be less
The Income Tax department is sending email notifications to the taxpayers with more than Rs. 50 crore turnover about the applicability of section 269SU. Taxpayers need to furnish an online report on the e-filing website from their own account. The due date to file the report is 31st January 2020. The Finance Act 2019 has come up with a new section, namely, section 269SU. A person with businesses having a turn over of more than Rs 50 Crore mandatorily need to offer facilities for payments through electronic transactions. Section 269SU actually became effective from the 1st November, 2019. As per
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