How the GST launch impacts you: All your questions about the tax reform answered

Do registered dealers have to record Aadhaar/PAN while selling goods to unregistered dealers?

 As the nation prepares for the rollout of the Goods and Services Tax (GST) from 1st July 2017 midnight, the government has prepared a FAQ sheet based on several questions it received on Twitter.

Here is a summary of some the most frequently asked questions and their answers:

What is Goods and Services Tax?
It is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as set off. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer.

The GST would replace the following taxes:

(i) taxes currently levied and collected by the Centre:
a. Central Excise duty
b. Duties of Excise (Medicinal and Toilet Preparations)
c. Additional Duties of Excise (Goods of Special Importance)
d. Additional Duties of Excise (Textiles and Textile Products)
e. Additional Duties of Customs (commonly known as CVD)
f. Special Additional Duty of Customs (SAD)
g. Service Tax
h. Central Surcharges and Cesses so far as they relate to supply of goods and services

(ii) State taxes that would be subsumed under the GST are:
a. State VAT
b. Central Sales Tax
c. Luxury Tax
d. Entry Tax (all forms)
e. Entertainment and Amusement Tax (except when levied by the local bodies)
f. Taxes on advertisements
g. Purchase Tax
h. Taxes on lotteries, betting and gambling
i. State Surcharges and Cesses so far as they relate to supply of goods and services

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Full GST rate list: Here are the tax rates for all goods and services

Foodgrains are slated to cost less from July 1

 

Foodgrains will cost less from July 1 when the nation-wide Goods and Service Tax (GST) is rolled out as the GST Council today decided to exempt the daily-use commodities from the levy.

Here's a complete list of the rates of all 1,211 items but six were finalised at the first day of the two-day meeting in Srinagar of the GST Council, headed by Union Finance Minister Arun Jaitley and comprising state representatives.

Also, here's a complete list of all the items that the GST Council has broadly approved as the rates of GST Compensation Cess to be levied on certain goods.

Full GST rate list

Aadhaar-PAN linking: Here is how to do it in easy steps

It's mandatory to link Aadhaar with PAN. Here's why

 

Come July 1, the Modi-government's measures to track tax evasion through multiple PAN cards will come into effect. It is now mandatory for you to link your existing Aadhaar numbers with PAN to be able to file your income-tax (I-T) returns.

Finance Minister Arun Jaitley, through an amendment to tax proposals in the Finance Bill for 2017-18, had made linking Aadhaar mandatory for filing I-T returns.

 

How to link your Aadhaar to PAN online

The tax department has said "every person who has been allotted PAN as on July 1, 2017, and who in accordance with the provisions of sub-section (2) of section 139AA is required to intimate his Aadhaar number, shall intimate his Aadhaar number to the principal director-general of income tax (systems), or DGIT (systems)".

 

Here is how you can use the SMS facility to link Aadhaar with PAN

While Aadhaar is issued by the UIDAI to a resident of India, PAN is a ten-digit alphanumeric number issued in the form of a laminated card by the I-T department to any person, firm or entity.

 

As many as 2.07 crore taxpayers have already linked their Aadhaar with PAN. There are over 25 crore PAN card holders in the country while Aadhaar has been issued to 115 crore people.

7th Pay Commission allowances finally get government nod: Key highlights

Here are the details of the 7th Pay Commission recommendations as approved by the Union Cabinet

 

 

Following are highlights of the approval given by the Cabinet to the recommendations of the 7th Pay Commission (CPC) on allowances with some modifications.

* House Rent Allowance will be paid at 24, 16 and eight per cent for X, Y and Z categories of cities, respectively.

* HRA will not be less than Rs 5,400, Rs 3,600 and Rs 1,800 for X, Y, and Z categories of cities, respectively, calculated at 30, 20 and 10 per cent of minimum pay of Rs 18,000.

* The CPC recommended revision of HRA when DA reaches 50 per cent and 100 per cent. The government decided to revise rates when DA crosses 25 per cent and 50 per cent, respectively.

* Siachen Hardship Allowance increased to Rs 42,500 per month.

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* For JCOs and Other Ranks, the hardship allowance for Siachen will be Rs 30,000 compared to the 7th Pay Commission's recommendation of Rs 21,000. The JCOs and ORs were getting Rs 14,000 per month as hardship allowance for Siachen at present.

* For the defence personnel in peace areas, Ration Money Allowance will now be given in "cash" and it will be directly transferred to their bank accounts.

* Allowances like washing, uniform, kit maintenance, outfit have been rationalised and subsumed in the newly-proposed dress allowance to be paid annually in four slabs Rs 5000, Rs 10,000, Rs 15,000 and Rs 20,000 per annum for various categories of employees.

* Rate of Children Education Allowance has been increased from Rs 1,500 per month per child (maximum 2) to Rs 2,250. Hostel Subsidy will also go up from Rs 4,500 to Rs 6,750 per month.

*READ MORE...

From July 1, Aadhaar 'must' for filing tax returns, obtaining new PAN

This means every person must quote either Aadhaar number or enrolment ID number for ITR, PAN card

 

 

The Central Board of Direct Taxes (CBDT) on Saturday made it clear that Aadhaar will be a "must" for the filing of Income Tax Returns or for obtaining a new PAN from July 1.

The policy-making body of the Income Tax Filing Department issued a statement stating that the Supreme Court, on Friday, had only given a "partial relief" to those who do not have an Aadhaar or an Aadhaar enrolment ID, and the taxman, hence, will not "cancel" their Permanent Account Number (PAN).

The CBDT issued a three-point "effect of the judgement" of the apex court statement saying.
From July 1, 2017, onwards every person eligible to obtain Aadhaar must quote their Aadhaar number or their Aadhaar enrolment ID number for the filing of Income Tax Returns as well as for applications for PAN.

"Everyone who has been allotted permanent account number as on the 1st day of July 2017, and who has Aadhaar number or is eligible to obtain Aadhaar number, shall intimate his Aadhaar number to income tax authorities for the purpose of linking PAN with Aadhaar," it said.

It explained what will happen in a case of "non-compliance" or where a person does not possess Aadhaar....read more....

NATGRID to get I-T's PAN records, taxpayer data access

While there are over 25 cr PAN holders in the country, actual number of taxpayers is about 5 cr

 

 

The NATGRID, a network aimed at sharing information about terrorists among security agencies, will now be getting access to the Income Tax Department's PAN records and individual taxpayers' data.

The ambitious project conceived by the then Home Minister P Chidambaram during UPA II rule will soon be getting new powers to access tax payers' information after it signs a Memorandum of Understanding (MoU) with the Income Tax department.

According to an order issued by the Central Board of Direct Taxes, the department will share 'bulk information', starting from the Permanent Account Number (PAN) to the taxpayer's name and all the individual data that it captures like father's name, gender, date of birth, photograph and signature or thumb impression.

The department will also share with the National Intelligence Grid (NATGRID) all information available in the department's database regarding residential and office addresses, addresses for communication, email addresses and phone and mobile numbers of all the taxpayers.
The MoU with the NATGRID that functions under the Union home ministry will also include confidentially clause so that transfer of personal data is safe.

According to data, while there are over 25 crore PAN holders in the country, the actual number of taxpayers is about 5 crore....

(read more...)

I-T Dept slaps Rs 24,500-cr tax notice on PACL

Demand adds to the Rs 57,000-crore dues payable from company's assets on sale

 

 

The income tax (I-T) department has raised a massive tax demand of about Rs 24,500 crore on troubled realty-based investment firm PACL (formerly Pearls Agrotech Corp). The revenue demand pertains to a six-year period, from assessment year 2008-09 to 2014-15.

The I-T department has written to a committee headed by former chief justice R M Lodha to consider this claim “so that the due tax  liability of the assessee company can be recovered after the sale/auction of the various properties of M/s PACL Ltd”. The committee has informed the Supreme Court of this tax demand as part of its submissions recently.

These claims have added substantially to the dues of the company, which already owes more than Rs 57,000 crore to some 51.5 million investors. The firm had run into trouble with markets regulator Securities and Exchange Board of India (Sebi) for raising this money without necessary approvals.
This is the second such large demand by the I-T department on a company under Sebi orders. In April, reports said the department had raised a Rs 24,646-crore demand on the Sahara group’s Aamby Valley, after conducting a special audit.

PACL was allegedly carrying on an investment scheme, though it couched this in the real estate activity of purchase and sale of land parcels across the country. In the process, it had accumulated vast tracts of land, a large part of this being barren agricultural land. After a protracted legal battle that dragged on for over 15 years, Sebi had directed the company to refund Rs 49,100 crore along with interest in (read more...)

Online platforms make tax filing easy, help fill details automatically

If you have capital gains on a house or shares, they can automatically tell you the tax liability

 

The Income Tax department on May 4 activated an e-filing facility in which you can start filing returns. The department has also simplified the ITR forms to make it easier for individuals to file returns. If you still find filing this a tedious, you can approach online tax filing websites. These platforms are using technology to shorten the process and avoid errors.

 

If you are a salaried person, in most websites you can upload Form 16 on the website. Their software automatically picks the details and fills all the fields, avoid hassle of an individual typing each and every detail manually. These platforms can also parse multiple Form 16s, if the individual has changed jobs, and compute the tax liability. “If all the required details are handy, a salaried person can file tax returns within 10 minutes,” says Chetan Chandak, head of tax research, H&R Block India. If you have capital gains on a house or shares, these websites can automatically tell you the tax liability, once you enter the date of buying and selling and price at which you bought and sold the asset.

It’s not only for the salaried. These platforms have also simplified tax filing returns for business owners and professionals. Explains Archit Gupta, founder of Cleartax.com: “The ITR Form for business is a lengthy form with multiple pages. To simplify, we just ask around five questions to the taxpayer. Using the answers, we fill all the relevant details automatically.”

In most of the platforms, a business owner can generate tax deduction at source, or TDS. Individuals can check refund status. If you have received an income tax notice, you can use their consultation services and know how you should proceed further. If there’s a mistake, you can also file revised returns. When you enter details, these websites use tax optimisers to tell you areas where money can be saved. “We also offer a vault where you can store all tax-related documents for future reference,” says Sudhir Kaushik, co-founder, Taxspanner.com....(read more...)

Soon, get notification of tax scrutiny notice over SMS, reply online

I-T department is looking to make the process easier for taxpayers

 

 

Replying to income tax (I-T) scrutiny notices with supporting documents will soon be just a click away.

Instead of having to make the rounds of the tax department with a sheaf of papers in response to notices received, taxpayers can soon upload them on the department's e-filing portal sitting in the comfort of one's own premises.

The I-T Department will very soon launch on its e- filing website a facility for uploading of information sought through scrutiny notices, a senior government official told PTI.

"This is part of our focus to reduce human interface and make the department more taxpayer friendly," he said, adding, "The facility to e-file the documents to scrutiny notices is being done to reduce interface between the assessing officer and the taxpayer."

Also, the tax department plans to soon start an SMS facility to communicate with taxpayers about any scrutiny notice sent to them.

"We will send SMS on the registered mobile number informing them to go to their account in the e-filing portal to see the new notice," the official said.

Once the facility is started, taxpayers will get an SMS alert of a new notice or information being raised by the income tax department. The assessee can then log on to the e-filing portal and upload the documents that have been sought.

Currently, the department sends SMSes for informing taxpayers, especially the salaried class, about the tax deducted at source (TDS). Also, such alerts are sent on filing of tax returns and their acceptance...read more...

Paying over Rs 50k as rent? Now you must cut TDS and deposit with I-T dept

Govt has tightened several rules governing real estate to step flow of black money in the sector

 

 

For the past four-five years, the income tax (I-T) department has been consistently tightening its noose around realty transactions. From making registration of rental agreements with PAN details of both the tenant and owner mandatory to the latest — deduction of TDS (tax deducted at source) on monthly rental of Rs 50,000 and above — rules have been tightened significantly to ensure black money isn’t generated from this sector.

The Central Board of Direct Taxes’ (CBDT’s) latest salvo targets people who claim significant amounts as house rent allowance (HRA), sometimes with the help of false documents. From June onwards, those who pay monthly rental of Rs 50,000 need to deduct 5 per cent TDS and deposit it with the IT return department.

This TDS trail will serve as proof for people claiming high HRA. The provision was introduced in the Finance Bill, 2017. “The idea behind the provision is to make sure taxpayers don’t claim fake HRA exemption and also to trace those who don’t disclose their rental income. When a trail is created, it will be possible to detect such individuals in the system,'' said Kuldip Kumar, partner and leader, personal tax, PwC India.

Interestingly, the government has also made the provision that if multiple tenants stay at the same place and pay total rent of Rs 50,000 and above per month, they need not deduct TDS. But, all tenants’ names should be in the registered agreement with the owner. On the other hand, if the entire rent is paid by a single tenant and the others are merely paying that person, then TDS is applicable. Clearly, CBDT has given relief to people staying together, especially in big cities and paying high rent to stay near their office or for any other reasons...read more...