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February 2, 2024 / CBDT

Complete Overview of Tax Deducted at Source U/s 194O

Complete Overview of Tax Deducted at Source Under Section 194O

E-commerce operators (ECOs) are needed to deduct TDS @ of 1 % on Gross amount of sales facilitated via their Online platforms u/s 194-O. The CBDT has issued a circular outlining the tax deduction process in certain transactions, especially where multiple e-commerce operators are involved, such as through Open Network for Digital Commerce (ONDC).

E-commerce operators & participants

- E-commerce participants: E-commerce involves various participants, each playing a specific role in the online buying and selling process, E-commerce participants register on online platform owned by ECO & use platform to sell Goods & Services. E-commerce participants must be residents of India.. Here are some key participants in the e-commerce ecosystem, For example: Consumers/Buyers, Sellers/Retailers, E-commerce Platforms, Payment Gateway Providers, Shipping and Logistics Companies, E-commerce Service Providers, Manufacturers/Suppliers, Digital Marketing Agencies, Customer Support Services, Regulatory Bodies, Developers and IT Professionals, Review and Feedback Platforms.
- E-commerce operators: typically refers to individuals or entities that manage, own, or operate the e-commerce platforms. E-commerce operators own the online facility to give Goods & Services on their platform; Normally e-commerce operators are responsible for managing and maintaining the owned Online E-commerce platform. He is responsible for making payments to the e-Commerce participant on such sales, These operators are responsible for the overall functioning, maintenance, and growth of the online marketplace. Here are different types of e-commerce operators. For example : Marketplace Operators, Retailers/Storefront Operators, Payment Gateway Operators, Logistics and Fulfillment Operators, Technology and Platform Providers, Advertising and Marketing Operators, Data and Analytics Providers, Customer Support and Service Providers, Regulatory Compliance and Security Services, Review and Feedback Platforms.

Here are the key points related to Section 194O:

Applicability: Section 194O is applicable to e-commerce operators who facilitate the sale of goods or the provision of services through their digital or electronic platforms.
Nature of Payment: TDS is applicable when the e-commerce operator makes a payment to the e-commerce participant (seller/service provider).
Threshold Limit: TDS under Section 194O is applicable if the gross amount of sales or services or both during the previous year exceeds Rs. 5,00,000.
Rate of TDS: The TDS rate under Section 194O is 1% of the gross amount of sales or services or both. However, if the e-commerce participant does not provide a PAN/Aadhaar, the TDS rate is higher at 5%.
Timing of TDS Deduction: TDS is deducted at the time of credit of the amount to the account of the e-commerce participant or at the time of payment, whichever is earlier.
Payment to Non-Residents: If the e-commerce participant is a non-resident, the TDS rate may vary, and other provisions of the Income Tax Act may be applicable.
Filing of TDS Returns: The e-commerce operator is required to file TDS returns in the prescribed form and furnish a TDS certificate to the e-commerce participant.
As per Section 194O, An E-commerce Platform is responsible for deducting TDS at the rate of 1 percentage of the gross amount credited to the seller’s account or at the time of making payment, whichever is earlier.

Tax Deducted at Source Under Section 194O applicable to any transaction e-commerce operator facilitates involving services & goods which includes Technical & professional services.
The Tax Deducted at Source must be deducted at the time of crediting the seller’s account, irrespective of the manner & mode of payment. New Section 194O imposes taxes on the e-commerce platform, which was not done before the Financial Act 2020.

CBDT CIRCULAR NO. 20, DATED 28-12-2023 & RELEASES GUIDELINES FOR TDS U/S 194-O:

The Central Board of Direct Taxes has released a circular to address a number of taxpayer concerns in light of the rise in transactions with online and e-commerce companies. The CBDT circular also update on recommendations for conveyance or shipping costs, indirect taxes, modifications in the event of a purchase return, & tax reduction in the case of several e-commerce operators. Moreover, savings offered by e-commerce have received special attention.

Few issues are addressed in general guidelines stated The Central Board of Direct Taxesin Circular No. 20 of 2023,

Question : ECO imposes commission or convenience fees per transaction, delivery fees, etc on transaction of sale of goods or services via ECO Platform. Do these elements constitute part of the “Gross amount” for TDS purposes u/s 194-O of the Income Tax Act?

Ans: These charges are considered part of the gross amount. Payments made to the network provider or via platform, such as Open Network for Digital Commerce, which facilitates online transaction, will also be included in the gross amount subject to Tax Deducted at Source U/s 194-O of the Income Tax Act.

Question: Who should TDS where there are multiple ECO involved in a transaction?

Ans: In compliance with section 194-O of the Income Tax Act, Responsibility lies with the ECO making the payment to the seller.

Application of Sec 194 OVs. Section 194 H:

Question: For the Commission that is Paid to Amazon , Whether I have to deduct TDS u/s 194H . Since in 194O , TDS is already deducted on Gross Amount ie. Including Commission Amount.

Ans: Section 194O states that if TDS is Deducted for a Particular transaction under this Section ie.194O then TDS need not be deducted under any Other Section. But 194O says , If TDS is deducted under 194O for a particular transaction then there’s no need to deduct TDS under any other section

CBDT clarifies TDS/TCS u/s 194-O, 194Q & 206C(1H); No TDS on sale through e-auction:

The Central Board of Direct Taxes vide Circular No. 20 of 2021 dated November 25, 2021 has clarified that if the component of VAT, sales tax, excise duty, CST, GST, etc., have been indicated separately in the invoice, then TDS under section 194Q is to be deducted without including such indirect taxes.

June 27, 2024 / Project Finance

Basic Tax advantage to Borrowers on taking Personal Loan

What are the Basic Tax advantage to Borrowers on taking Personal Loan ?

Over the past ten years, fintech has allowed the present-day financial industry to grow and change in many ways. The process of applying for a loan, having it approved, and receiving the funds in your bank account is simpler and faster than before. Maybe this explains why personal loans are becoming more and more common among self-employed and paid people.
A large number of people, however, downplay the significance of borrowing’s tax ramifications. In India, personal loans do not provide borrowers with direct tax benefits; nevertheless, there are numerous indirect benefits that can be obtained. A crucial element in ascertaining favourable tax consequences is the utilisation of money acquired via a personal loan.
Unlike some other types of loans, personal loans do not typically offer specific tax advantages to borrowers in most countries. However, there are a few potential indirect financial benefits to consider. The purpose of this blog is to enumerate crucial elements that borrowers must take into account in order to comprehend the tax effect on personal loans in India.

Interest Deductions

If you use a personal loan for intended purposes, you may be eligible for tax benefits. In India, you are eligible to claim tax deductions on interest paid under section 24 if you took out a personal loan and utilised the money for the purchase, construction, or repair of your home (b). However, you can only file this claim within the allotted parameters. In case the dwelling property is occupied by the owner, they can claim the total interest paid on the loan up to INR 200,000. Additionally, you ought to be able to provide solid evidence that the funds from the loan amount were used for this kind of expenditure.
Second, you may deduct the whole loan interest amount from your taxable rental income if you used the personal loan amount for a rental property. This deduction is additionally subject to a cap of two lakhs on the number of losses that can be written off against other income for the year under the residential property category for all properties considered together. Over 2 lakhs in unabsorbed loss can be carried forward for eight years against the income from the residential property.

Loan Purpose

Your personal loan could come with a few tax advantages depending on its intended use in India. The interest paid on the personal loan can be deducted from taxes, even though the original amount of the loan cannot be used to offset any deductions. You can deduct interest from your taxes if you have used the loan money for business expenses and have invested it in your company. The following is a list of additional circumstances in which you can use your personal loan to benefit taxes:

- Financing a down payment on home renovations or a home purchase
- Investing the amount in your business
- Purchase of assets such as shares, commercial property, jeweller, or any other commercial endeavour wherein the interest expense increases the cost of acquisition to reduce capital gains tax on the sale.
- Renovating or purchasing or constructing self-occupied property

Reporting Requirements

If you have taken out and paid back a personal loan, or are in the midst of doing so, there are no prescribed requirements to report that you must disclose when filing your taxes. You must have all the necessary documentation to disclose the borrowing and the use/purpose of the loan funds if you want to receive tax benefits on your personal loan. If you use the loan amount to build a home, you must report it similarly to property taxes; if you use it to finance your business, you must report it similarly to sales tax. If a personal loan is cancelled, the borrower is required to include the information in their tax returns. Here, the discharged debt regulations would be applicable.

Tax Credits

A personal loan often does not qualify for tax credits or deductions. However, you are eligible for tax benefits on a personal loan if the following categories apply to the loan purpose.

Personal Loan for Business

The interest paid on a personal loan deducted from taxable net profit is a business expense if the loan amount is invested in your business. The tax-deductible obligations of a business are not restricted by the Income Tax Act in India. This implies that the business’s tax obligations can be decreased by using the whole interest paid on the personal loan.
Personal loans can take benefit of several advantages from personal loans, such as affordability, ease of use, and quick funding. If you properly document your loan and your loan purpose fits into the desired category, you can receive considerable tax savings on the interest paid, even though they might not be very significant. Remember the things mentioned above, and before taking out a loan, always think about how it will affect your taxes. Furthermore, even though personal loans provide financial freedom, it’s important to use them responsibly and refrain from accruing more debt than you can afford.

Personal Loan for Construction or Purchase Renovation of Residential House Property

loan advantages

According to Section 24 of the Income Tax Act of India, a borrower’s net taxable income may be reduced by the interest paid on a personal loan used to buy, build, or renovate residential property. The borrower must provide the required paperwork to support the use of funds in order to accomplish this. Deductions for a self-occupied residential property are allowed up to INR 200,000/-

Personal Loan for Purchasing Assets

In case borrower is not eligible for tax reduction at the time of purchase if they utilise the money from a personal loan to buy assets like shares, jewellery, or commercial real estate. But, the cost of the purchase may include the interest paid on the personal loan. Moreover, you can deduct interest exp which is paid while selling this asset as capital gains. So you may decrease your taxable profit. Here you may check the tax credits related to this category:

Documentation and Record Keeping

It should come as no surprise that loans have thorough documentation. Documentation clarifies the goals and expectations of both parties, whether the loan is obtained from a private or bank institution. It provides evidence of the loan amount and offers advantages to both the borrower and the lender. Accounting, taxation, collection, and loan enforcement all require documentation. In order to be eligible for tax benefits on your personal loan, you must finish all the paperwork. Additionally, for the duration of the loan, you should keep all the records and paperwork required to demonstrate the purpose of your loan.
For people with complicated income and tax situations, it is best to talk with a tax expert. Self-employed people with erratic incomes and several loans are a few examples. It could be challenging to determine your own income and tax liability. You may make sure that your annual tax file and declaration are proper by hiring a qualified tax professional. A qualified tax adviser can also assist you in understanding the tax benefits associated with your loan, if you are not fully aware of them now.

Other Advantage above

Simplicity: Personal loans are straightforward. You receive a lump sum, and you repay it over a fixed period with a fixed interest rate. This simplicity can make budgeting and financial planning more manageable.
No Collateral: Personal loans are typically unsecured, meaning you don’t need to put up collateral (such as a house or a car) to secure the loan. This reduces the risk of losing assets in case of default.
Faster Approval: Personal loans often have a quicker approval process compared to other types of loans, which can be advantageous in situations where you need funds urgently.
Debt Consolidation: You can use personal loans to consolidate high-interest debts, such as credit card debt. By paying off higher-interest debt with a personal loan, you may effectively reduce the overall interest you pay.
Credit Score Impact: Successfully repaying a personal loan can positively impact your credit score, which can lead to more favorable terms on future loans or credit.

May 31, 2024 / GST

Prefilled GST data will be coming soon as Income Tax AIS

Prefilled GST data will be coming soon, as Income Tax AIS

The government is creating pre-filled consolidated GST return forms that would allow taxpayers to access all of their transaction details and e-invoices to determine their precise tax due, similar to the Annual Information Statement (AIS) feature used by the Income Tax dept.

Govt is developing pre-filled consolidated Goods and Services Tax return forms along lines of the Income Tax Dept’s AIS, which will allow Goods and Services Tax taxpayers to view all of their transaction details and e-invoices to determine their exact tax liabilities. CBIC is preparing a consolidated Goods and Services Tax pre-filled data form that will include an e-verification feature to resolve any discrepancies in data before to GST filing return, reducing the scope of any error in Return.

The Central Board of Indirect Taxes and Customs (CBIC) is preparing a consolidated pre-filled form that will include an e-verification tool to resolve any data discrepancies before the return is filed, minimising the possibility of error.

As per GST officials, Facility, which is expected to be launched by the end of this year, will reduce litigation, improve compliance, and make it easier to file Goods and Services Tax returns without the hassle of uploading so many documents.

Prefilled GST data

He also Added “Automation in filing is already happening and by November we expect the launch of a consolidated AIS like feature for the Goods and Services Tax taxpayers also,”

Presently a Normal business required to submit 3 GST Returns –GSTR-3B & GSTR-1 on quarterly or monthly basis, depending on their turnover and an annual GSTR-9 form. While some forms already have Goods and Services Tax prefilled data, it is not synchronised & GST taxpayers have to match all details around purchases, sales, refund claims or demand created separately to avail input tax credit. According to the GST official, the facility is expected to cut the time and cost of e filling by 60%.

By reducing the threshold for E-Invoices, syncing their financial data from banks and automating inspection, non-banking financial corporations, and data sharing from the income tax department, the GST department has already worked to collect more data from taxpayers over the last six months.

Goods and Service Tax Network will be integrated with the country’s ambitious financial data sharing network, Account Aggregator, before July 1 2023

prefill

India Financial Consultancy corporation Pvt Ltd is a Service Platform dedicated to provide all kinds of services under one roof i.e. with the aim of “MAKING BUSINESS EASY “at affordable prices. India Financial Consultancy corporation Pvt Ltd give Corporate advisory, financial solution, experienced CFO Service & affordable business Solutions to SMEs, business owners and Entrepreneurs, Companies, to address their all business needs requirements. To know more kindly contact us on: +91 9555-555-480 or singh@caindelhiindia.com

July 2, 2023 / GST

All About the Advantages of the Goods & Service tax

All About the advantages of the Goods and Service tax

Q.: What are the advantages of the GST?

The following are some of the GST’s advantages:

Intended for use in business and industry.
Easy compliance: The GST regime in India would be built on a solid and comprehensive IT system. As a result, all tax payer services, such as registrations, returns, payments, and so on, will be available online, making compliance simple and transparent.
Tax rate and structure uniformity: GST will ensure that indirect tax rates and structures are common throughout the country and will therefore improve security and business ease. In other words, GST would make doing business in the country tax neutral, regardless of where it is done.
Removal of wide portfolio: A system of seamless tax credits across the value chain and across state borders would ensure that tax cascading is kept to a minimum. This would reduce the unintentional costs of doing business.
Improved competitiveness: Lowering transaction costs would eventually lead to increased competitiveness for trade and industry.
Gain access to producers and exporters: The incorporation of major Central and State taxes into GST, the complete and comprehensive set-off of input goods and services, and the phase-out of the Central Sales Tax (CST) would lower the cost of locally manufactured goods and services. This will boost Indian exports by increasing the competitiveness of Indian goods and services in the international market. The consistency of tax rates and procedures across the country will also help to reduce compliance costs.
Intended for both the central and state governments.
Simple and straightforward administration: GST is replacing a number of indirect taxes at the federal and state levels. GST would be simpler and easier to administer than all other indirect taxes charged by the Centre and States to date if it were supported by a comprehensive end-to-end IT infrastructure.
Better leakage controls: Due to a robust IT infrastructure, GST would result in better tax compliance. Because of the seamless transfer of input tax credit from one stage to the next in the value chain, there is an in-built mechanism in the design of GST that would incentivize tax compliance by traders.

Increased revenue efficiency: GST is expected to reduce the cost of the government’s collection of tax revenues, resulting in increased revenue efficiency for the consumer.
A single, transparent tax proportional to the value of goods and services: The cost of most goods and services in the country today is laden with many hidden taxes due to multiple indirect taxes levied by the Centre and States, as well as incomplete or no input tax credits available at progressive stages of value addition. There will be simply one tax from the manufacturer to the customer under GST, resulting in tax transparency for the final consumer.
Reduction in total tax burden: As a result of efficiency gains and leakage prevention, the overall tax burden on most commodities will decrease, benefiting consumers.

Q.: In India, how would GST be implemented?

Given India’s federal structure, there will be two components of GST: Central GST (CGST) and State GST (SGST) (SGST). GST will be levied across the value chain by both the Centre and the States at the same time. Every supply of goods and services will be taxed. The Centre would levy and collect the Central Goods and Services Tax (CGST), while the States would levy and collect the State Goods and Services Tax (SGST) on all transactions within a State. At each stage, the CGST input tax credit would be available for discharging the CGST duty on the output. Likewise, SGST paid on inputs would be allowed to be used to pay SGST on output. There would be no credit cross-utilization allowed.

One Nation, One Tax -6

Q.: What exactly are GST APIs? How can it assist businesses in filing GST returns?

GST APIs are a government initiative to give online GST services to taxpayers in order to make their work easier and promote GST compliance through site-to-site interfaces.
IFCCL is a government-approved GST Suvidha Provider that provides businesses with seamless, relevant, and high-quality GST solutions.
Both Tax Practitioners and Businesses can use IFCCL’s services for GST Return Filings, e-Way Bills, e-Invoicing, Reconciliation, Annual Returns, and more.
India Financial Consultancy corporation Pvt Ltd offers solutions for a variety of generic and customized ERPs, including Tally SAP, Marg, Oracle, and others.

IFCCL is a Service Platform dedicated to provide all kinds of services under one roof i.e. with the aim of “MAKING BUSINESS EASY “at affordable prices. IFCCL give Corporate advisory, financial solution, experienced CFO Service & affordable business Solutions to SMEs, business owners and Entrepreneurs, Companies, to address their all business needs requirements. To know more kindly contact us on: +91 9555-555-480 or singh@caindelhiindia.com

December 10, 2024 / CBDT

Tax Dept tightens Grip its control over advance tax payments

Tax Department tightens Grip its control over company advance tax payments

In order to make sure that companies do not put off the payment of taxes for the duration of the fiscal year,
The Income Tax Department is actively keeping an eye on advance tax payments by carefully examining companies’ annual and quarterly balance statements as well as sectoral growth trends.
Most recent annual reports and quarterly reports from the top 100 listed companies will be examined, according to the tax department’s core action plan for the financial year 2023–24.
According to study, senior authorities would supervise the collection of advance taxes, paying specific attention to “notes” and any observations on bank accounts.

ADVANCE TAX - A Brief Analysis

Which Sectors or industry are under Scanner?

Citing unnamed sources, tax investigators will mention institutions, patterns in specific industries, pharmaceuticals, steel, real estate, mining, financial institutions, gems & jewellery, and trends in other areas.
On condition of anonymity, a tax official said, “It’s important to look at the balance sheets of companies in each sector to see if payments they’re making are in line with their earnings forecast.”
The practise of paying tax on income earned within the same FY before the FY ends is known as advance tax payment. Corporations and partnership enterprises must pay taxes in four installments on June 15, September 15, December 15, and March 15.
By June 15, businesses would pay the first advance tax installment. Prior to increasing tax demands, a technique for doing quality checks with a focus on dues recovery has been developed.

How to calculate advance tax?

How to calculate advance tax

Calculate your overall income by adding up all of your receipts.
Subtract only the expenses that are directly relevant to your job.
Include earnings from other sources, such as a rental property or a savings account.
Determine your tax slab and compute your tax liability.

Advance Tax

Remember to deduct TDS

If your tax payment exceeds Rs.10,000, you must pay advance tax by the deadlines listed below.

Due date for Advance Tax

On-or before 15th June	Not less than 15% of advance tax
On or before 15th September	Not-less than 45% of advance tax as reduced by the tax paid in the last installment.
On-or before 15th December	Not less than 75% of advance tax as reduced by the tax paid till the last installments.
On or before 15th March	The whole amount (100%) of advance tax as reduced by the tax paid till the last installments.

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June 5, 2024 / DTAA

Taxability on Shares & ESOP outside India

Income Tax Taxability on Shares & ESOP outside India

Basic primary goal behind any loan term & short-term investment strategy is to generate the maximum return on our investment. So this the basic reason, people use to move towards investment in foreign stocks for good return on investment.
To demonstrate, long-term investment in scalable, alluring worldwide firms can generate hug profits. For instance, if you had made an investment in one of the major digital firms such as Apple, Google, Amazon, Facebook, Netflix, etc. about ten years ago, you would currently be enjoying excellent return.
Therefore, if you are a knowledgeable investor, you could indeed diversify your stock investments by geographically.

The following are some principles for buying overseas/ foreign stocks.

You could purchase shares of a foreign firms via using various methods such as Direct Investment or

Personal Investment
(ESOPs) Employee Stock Option Plan of an regime whose start-up business is located outside from India. Therefore, Employee Stock Option Plan gives the right to Indian employees to subscribe to shares of the parent company at a predetermined rate.

Moreover, tax implications allied with such investment become a sufficient points of Ideas for local investors. Therefore, we’d like to shed some light on the tax implications of

Investment in foreign stock from India.
Employee Stock Option Plan (ESOP) of start up firms which is situated outside from india.

The Actual Fact

Now in trend that Investment in the global stock market is a fresh, growing rapidly practice among Indian investors.

Those who are not aware absolutely, Indian residents can buy shares of global firms which are listed on foreign stock exchanges. However, they should hold about 10% shares in the entity in which the investment is being made, and must not have any control over it.

Yes for sure, if you’re an Indian resident, you can buy a stock in companies such as Apple, Amazon, Microsoft, etc.

How?

By:

Either create an account with an Indian broker who has connections to foreign agents like HDFC Securities, Axis Securities, Kotak Securities, ICICI Direct, etc.,

Or, via straight away open an account with foreign broker who is active in India such as Trade station, Saxo Bank, Charles Schwab.

Though, now a days MNCs are hiring employees from through out the world since then, the ESOP is also way of investing in the Start-up companies which is located outside India.

Those Employees who consent for Employee Stock Option Plan could obtain the stocks of the Employer firms if they accomplish some condition such as accomplishment of a specific Nos. of year in the entity or revenue goals set by the entity etc.

On realization of the conditions proposed by the employer company, the ESOP is vested with the employees.

Foreign companies frequently grant shares under the ESOP Plan to Indian residents who work for or serve as directors of a parent company office or branch in India.

Residents alone may occupy up to 10% of such overseas company paid-up capital in shares under the Employee Benefits Scheme they propose, whether listed or unlisted, at a fixed or predetermined price (normally below market value of shares).

ESOP has mutual benefits for the his employees & employer,

By providing ESOP, the employer is able to conserve skilled people, conserve cash flow, boost productivity, and get increase profitability. The employee is encouraged to work hard because he stands to gain if the employer company succeeds, creating a win-win situation. This increased profitability also has an impact on the market value and intrinsic value of the employer company’s shares.

Tax Implications associated with Direct Investment

Reserve Bank of India Permits Investment in Multinational Companies via numerous way such as Income Tax Act 1961 companies, Liberalised Remittance Scheme (LRS), overseas Direct Investment (ODI) under The Foreign Exchange Management Act, 1999 Certain rules set forth by the Indian government may be required of investors in foreign stocks.
First of all, we must identify income tax taxpayer’s location in respect of establish whether taxes are appropriate. It is dependent on how much time that the tax payer’s existence in India since the past year, the income taxpayer’s living location would be change.

According to above mention computation, residential status can be categorized as below:

Resident but not ordinarily resident – Taxability boost-up only when overseas income is got or acquired in India from a profession controlled or business or set-up in India.
Resident and ordinarily resident- For residents, all the income that earned and got worldwide is taxable in India.
Non-resident – Earning is taxable only when overseas income is got or grow in India.

After defining residential status, capital gain emerges when overseas stocks are sold for more than the purchase price. Even so, capital gains are further classified into two types based on the holding period of the investment.

Short Term Capital Gain
Long Term Capital Gain

Long Term Capital Gain

Long Term Capital Gains emerge when stocks of overseas companies have been holding for more than twenty-four Months or Two Years.
Long-term capital gain from the sale of International stocks would be taxed at a flat @ 20%, plus health and education cess (plus surcharge, if apply) and Listing advantage on investment cost.

Short Term Capital Gain

Short Term Capital Gain shall emerge when stocks of oversees Business have holding a period of upto twenty-four months or two years.
Short Term Capital Gain is merged to the taxpayer’s total Income and is taxable at Normal income tax slab rates.

Tax Implications via ESOP

Employee Stock Option Plan allows Indian employees to register to parent company stock at a pre – determined rate (usually below the price in the current prevailing market). However, the difference between the fair market value and the exercise price is taxable in the employee’s hands as a “perquisite.”
Moreover, In case shares are sold, Distinguish between the fair market value & sale price at the time of sale is taxed as capital gain. The tax rate appropriate at the time of sale will be exactly the same as in the case of direct investment, depending on the employee’s holding period of the option.

Disclosure & Reporting in ITR Form.

According to Income Tax law, it is compulsory for every to taxpayer of holding a international stocks or earning income from international equities, to submit ITR in India, irrespective of the fundamental exemption limit.
In ITRs, the Assesses must expose all the overseas investments with overseas equities in Schedule-FA of ITR 2 or ITR 3, According to the source of his income, he might face criminal charges.
Furthermore, India has entered into DTAA more than 95 countries, which can assist you in claiming tax credits.

ESOP in India

To summarize

When analyzing an investment in foreign stocks or in foreign entities, one must consider not only the potential for income and capital appreciation or the fluctuation of foreign exchange rates, but also the after-tax yield from such an investment.
Income tax Taxability on Employee Stock Option Plan is depends on persons / employees residential status. In case an employee is a resident but not ordinarily resident or non-resident & have exercised their Employee Stock Option Plan options or sold their shares, then in that case they may have to pay tax outside of India,

Non-Resident Indian (NRI) Services: Tax & Regulatory Compliance and Advisory

We providing Comprehensive solutions ensure compliance with FEMA and other statutory regulations, making it easier to manage financial and legal obligations for For NRIs, PIO, & OCI, Navigating the tax and regulatory landscape in India can be complex. Below are the key areas of focus:

Income Tax Compliance

we are helping the DTAA provisions help avoid being taxed twice on the same income in India and the country of residence. also Assistance in filing income tax returns in India, including guidance on income from Indian sources such as property, investments, and business operations.

Employment Considerations

we provide tax implications and compliance for NRIs working in India, including salary structuring and deductions. Guidance on how Indian tax laws apply to income earned from foreign employment.

Residency Issues for Expatriates

we used to determining residential status as per Indian Income Tax laws and its impact on tax liability. also Advisory on maintaining or changing residency status for tax benefits.

Inheritance and Gifts

we are handling tax implications and compliance for inheritance and gifts received within India.
Advisory on receiving or sending inheritance and gifts from/to other countries, ensuring compliance with Indian tax laws and FEMA.

June 23, 2023 / INCOME TAX

Online Income Tax E-filing & Its Benefit

Point to be taken care while filling Online Income Tax E-filing

Confirm that the pre-filled details are correct by verifying PAN, permanent address, contact information, bank account information, etc. Find the appropriate return for you (from ITR-1 to ITR-7). Provide all pertinent information in the return, including the total amount of income, any deductions, any interest payments, any taxes paid or collected, etc.
Safety measures must to be taken before filing an ITR : The income tax return should not contain any additional papers. The taxpayer needs to determine which return form is appropriate in his situation. Complete the return form’s information with care. Verify the total income, any deductions, interest, tax liability, refund, and other computations.

taxpayers should compare the data in their AIS statement with their bank passbook, interest certificate, Form 16 & capital gains statement from brokerages also In the case of the purchase and sale of equity/mutual funds.
State details of all Indian bank accounts
Complexly mentioned your details of unlisted equity shares
All the details bout directorship carried in foreign companies as well as Indian.
The schedule liabilities and assets: the details of the specified assets like movable assets, land, building etc, & financial assets (shares & securities, bank deposits, cash in hand, etc.), as well as the liabilities, required to be disclosed if income of person is more than INR 50,00,000/-.
The finance Ministry has been sending out reminders to taxpayers via email, SMS, and media campaigns, advising them to not wait until the last minute to file their income tax returns.
To help taxpayers with e-filing ITRs, the Directorate of Systems is hosting webinars for frontline department staff (ASK Centres and TPS).
The Directorate of Systems, in coordination with Infosys personnel, is using the ICAI platform to promote knowledge about how to resolve issues that arise during the e-filing process.
ITD has created educational videos on its YouTube channel for the benefit of taxpayers.
All income tax taxpayers who have not yet filed their ITRs returns for the FY are urged to do so as soon as possible.’

ITR 1 filling

Online Income Tax E-filing – Benefit

Tax E-filing has been made mandatory by the Govt of India. The Income tax process is very simple as compared to previous paper base filing process. The Benefit of Online Income Tax filing are mentioned below :

Every year on July 31st, tax returns have to be submitted. Clients can complete the task more rapidly and with less congestion if they submit it one or two months before the deadline because servers tend to be become overloaded as the deadline draws near.
Online tax return filing allows the taxpayer to more effectively maintain track of all financial transactions with the Tax Department.
If the Income tax taxpayer later needs to conduct business with any other organisation that maintains such information, this record may come in handy.
The Income taxpayer is responsible for paying penal interest for each additional day until the day that the payment is made if he is unable to file an ITR for the preceding year.

ITR-1 for AY/FY 2023-24/2022-23 is available now on Income Tax portal

ITR last date 2022-2023

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Popular blogs :

October 21, 2023 / GST

GST Tax Evasion instances observed during GST law

GST Tax Evasion instances,

Normal GST Tax Evasion instances observed during the GST law

Fake invoices with fake GST number raised to collect Goods and services tax, but not deposited with government.
Making sales of services to GST registered persons not in line of same business, and thereby transfer the balance/unutilized Input tax credit and receive cash against the same.
Initially, Input tax credit claimed on assumption basis, and in the last months of the financial year, the said ITC is reversed, without payment of interest liability.
Amount of Taxable Supply, as prefilled based on filing of GSTR -1 can be manually changes in GSTR-3B, without stating the changes to particular invoices.
Bills manipulation, wherein Goods and services tax rate differ on account of bill amount, and accordingly lower GST rate is applied even though the sale value is more. – Apparel under 1000 rate us 5%, exceed 1000, rate is 12%.
Same trader takes 2-3 Goods and services tax registrations and transfer the whole turnover of 1 business to 3 business, thereby avoiding Goods and services tax registration and liability thereon.
Businesses are purchasing branded goods, but are selling them in open as unbranded goods, thereby evading from Goods and services tax liability.
Claiming Input tax credit paid on capital goods, which is required to be capitalized in the books and not to be claimed under Goods and services tax.
In order to evade from the compliance of E-way Bill, goods are transported using Railways, since the same is a proper mode to evade E-way bill requirement and thus facilitate evasion of GST.
Personal expenses incurred are booked under business expenses and thus, Goods and services tax input is transferred to business Goods and services tax number and ITC is accordingly claimed.
Businesses are knowingly making mistake in Goods and services tax liability, i.e. charging taxable supplies to exempt supplies, or charging lower GST rate, and thereby claiming unutilized ITC as refund.
Traders, local confectioneries and grocery stores donot issue bill to customers, and thereby suppress GST turnover.
GST evasion of Rs 23,000 cr by gaming companies in April 2019-Nov 2022 period being investigated.

GST normal Mistake

Directorate General of Goods and Service Tax Intelligence detects more than 6k fake Input Tax credit

Directorate General of Goods and Service Tax Intelligence detects more than 6k fake Input Tax credit cases involving more than Rs. 57,000 crore Goods and Service Tax evasion with the arrest of 500 persons From April 2020 to Sept 2023.

Directorate General of Goods and Service Tax Intelligence detects more than 6k fake Input Tax credit

April 4, 2024 / Direct Tax

NEW VS OLD TAX REGIME AFTER BUDGET 2023

TAX REGIME AFTER BUDGET 2023

Major Direct tax proposals (from speech)

1. Rollout of next gen ITR form
2. New limit for 44AD & ADA : 3 crore & 75 Lacs
3. Expense deduction to MSME to be allowed on payment basis
4. New cooperatives manufacturing tax @ 15% if upto 31.03.24
5. Higher loan limit /cash deposit Rs 2 lacs for PAC society –
6. Startups:
a) Date of incorporation for. startup extended to 31.03.24
b) Extension of Carry forwards of losses 7 yrs in case of change in shareholders

7. Selective scrutiny + More CIT to dispose off small appeals

8. Extension of tax benefits for IFSC

9. Personal Income tax
a) Tax rebate limit extended to 7 lacs (new regime)

b) change in tax slabs & new tax rates

0-3 L : Nil
3-6 L : 5%
6L-9L : 10%
9L-12L: 15%
12-15 L : 20%
15L +: 30%

c) Salaried class & pensioners(incl family pensioners) :
Standard deduction extended

d) Highest surcharge reduced from 37% to 25%
Now MMTR : 39%

e) Leave encashment exemption (pvt) increased from 3Lacs to 25 Lacs

f) New tax regime is now default tax regime -Old tax regime will continue

new income tax budget 2023

NEW VS OLD TAX REGIME AFTER BUDGET 2023

Increase in tax rebate: U/s 87A rebate limit has been increased from INR 12,500/- to INR 25,000/- in the new income tax mechanism/regime.

New income tax mechanism/regime becomes default: The new income tax mechanism/regime has been made default regime. That is, while filing an ITR, it will by default show the new income tax mechanism/regime. If you want to go with the old the income tax mechanism/regime, Income taxpayer will have to select it manually.

Standard deduction of INR 50,000/-: upto the earlier past year, an pensioners or employees paying tax used to get income tax deductions of INR 50,000/- only under old income tax mechanism. From current year, pensioners & employees who choose New income tax mechanism/regime will also get a INR 50,000/- standard deduction under the income tax.

Tax exemption limit in the new income tax mechanism/regime.: The tax exemption limit has been increased in the new tax regime. People adopting the new tax system will get tax exemption on income of up to INR 3,00,000/-, which till now was available only up to INR 2,50,000/-. That means tax exemption on additional INR 50,000/- will be available from this year.

For diff salaried incomes

Assumption- 80C investment 1.5 lac ( even other than Home loan) and 80D Mediclaim 25000 is claimed

conclusions

New regime is default setting- You have to file form for opt old one
For ppl having NO housing loan – New regime is beneficial – It doesn’t make diff whether You are paying 80C+80D full
Business ppl will have slight higher tax than above working as they wont get standard deduction of 50000
For ppl having housing loan – Always Old regime is beneficial

New and Old tax regime

taxation on income tax 2023

New Vs old income tax system

Changes in personal tax via Finance Act 2023

Changes in personal tax via Finance Act 2023 -2

Changes in personal tax via Finance Act 2023 -3

Changes in personal tax via Finance Act 2023 -4

Conditions to optin for New Tax Regime in Assessment Year 2024-25

Conditions to optin for New Tax Regime in AY 2024-25

November 7, 2022 / compliance calendar

Tax and Statutory Compliance Calendar for Nov 2022

The compliance deadline must be fulfilled, which needs careful planning. So We have created a complete compliance calendar that includes all the important Timeline dates so that you may stay up to date on the statutory & compliance requirements.
Here is the prepared tax and Registrar of company & income tax with GST compliance calendar for the deadlines occurring in Nov 2022. It covers the requirements for filing with the registrar of companies (ROC), the OPC annual report, the filing of GST returns, and the filing of taxes.

Goods and Services Tax

Goods and Services Tax : GSTR-1 Oct-22 11-Nov-22 ” GST Filing of returns by a registered person with aggregate turnover exceeding Rs. 5 Cr during the preceding year. Registered person, with aggregate turnover of less than Rs. 5 Crores during the preceding year, opted for monthly filing of return under Quarterly Returns with Monthly Payment”
Goods and Services Tax : IFF (Invoice Furnishing Facility) Oct-22 13-Nov-22 GSTR-1 of a registered person with turnover less than Rs. 5 Cr during the preceding year and who has opted for quarterly filing of return under Quarterly Returns with Monthly Payment.
Goods and Services Tax : GSTR -6 Oct-22 13-Nov-22 Due Date for filing return by Input Service Distributors.
Goods and Services Tax : GSTR-7- Tax Deduction At Source return under GST Oct-22 10-Nov-22 GSTR 7 is a return to be filed by the persons who are required to deduct Tax Deduction At Source (Tax deducted at source) under Goods and Services Tax.
Goods and Services Tax : GSTR-8- Tax collection at source return under GST Oct-22 10-Nov-22 GSTR-8 is a return to be filed by the e-commerce operators who are required to deduct Tax collection at source under Goods and Services Tax.
Goods and Services Tax : Due date of Payment of Tax Oct-22 25-Nov-22 Due date of payment of GST liability by the registered person whose aggregate turnover was less than INR 5 Crores during the preceding year and who has opted for quarterly filing of return.
Goods and Services Tax : Due date of Payment of Tax Oct-22 25-Nov-22 Due date of payment of GST liability by the registered person whose aggregate turnover was less than INR 5 Crores during the preceding year and who has opted for quarterly filing of return.
Goods and Services Tax : GSTR – 3B Oct-22 20-Nov-22 “1. GST Filing of returns by a registered person with aggregate turnover exceeding Rs. 5 Crores during the preceding year. Registered person, with aggregate turnover of less than Rs. 5 Crores during the preceding year, opted for monthly filing of return under QRMP.”
Goods and Services Tax : GSTR -5 Oct-22 20-Nov-22 GSTR-5 is to be filed by a Non-Resident Taxable Person for the previous month.
Goods and Services Tax : GSTR -5A Oct-22 20-Nov-22 GSTR-5A is to be filed by OIDAR Service Providers for the previous month.
Company Law MGT07 FY 2021-22 29-Nov-22 Form MGT 7 Filing for Companies & One Person Company. MGT-7 is the annual return filed for every company on a yearly basis containing information about shareholders, directors, etc. as on the last day of the relevant financial year, i.e. 31st March.
Goods and Services Tax: Last date of claiming ITC of FY 2021-22 FY 2021-22 30-Nov-22 Last date of claiming ITC of FY 2021-22 as per Section 16(4) of Central Goods and Services Tax Act, 2017

Income Tax

Income Tax: Tax Deduction at Source Certificate Oct-22 14-Nov-22 Due date for issue of Tax Deduction At Source Certificate for tax deducted under sections 194-IA, 194-IB, and 194M in the month of August 2022.
Income Tax : Tax Deduction at Source Certificate Sep-22 14-Nov-22 Due date for issuing of Tax Deduction at Source Certificate for tax deducted under section 194S in the month of September 2022. Under Section 194S. Tax deduction at source is deducted on payment made for the transfer of Virtual Digital Assets..
Income Tax: Tax collection at source Certificate Jul-Sep, 2022 15-Nov-22 Quarterly Tax deduction at source certificate (in respect of tax deducted for payments other than salary) for the quarter ending September 30, 2022.
Income Tax : Form 24G Oct-22 15-Nov-22 Due date for furnishing of Form 24G by an office of the Government where Tax Deduction at Source/ Tax collection at source for the month of Oct 2022 has been paid without the production of a challan.
Income Tax: Form 3BB Oct-22 15-Nov-22 Due date for the furnishing statement in Form no. 3BB by a stock exchange in respect of transactions in which client codes have been modified after registering in the system for the month of Oct 2022.
Income Tax Income Tax return Financial Year 2021-22(Assessment Year 2022-23) 7-Nov-22 “Due date for filing of return of income for Assessment Year 2022-23 of following assessees, not having any international or specified domestic transaction,
a. corporate-assessee; or
b. non-corporate assessee (whose books of account are required to be audited); or
c. Partner of a firm whose accounts are required to be audited or the spouse of such partner if the provisions of section 5A applies.
The due date of filing such return was Oct 31, 2022, earlier and the same got extended vide Circular no. 20/2022, dated 26-10-2022.”
Income Tax : Tax Deduction At Source Challan cum Statement Oct-22 30-Nov-22 Due date for furnishing of challan-cum-statement in respect of tax deducted under section 194-IA, 194-IB, 194-M, in the month of Oct 2022.
Income Tax: Income Tax return Financial Year 2021-22 (AY 2022-23) 30-Nov-22 Return of income for the assessment year 2022-23 of an assessee who is required to submit a report under section 92E pertaining to the international or specified domestic transaction(s).
Income Tax : Form No. 3CEA Financial Year 2021-22 30-Nov-22 Report in Income tax Form No. 3CEA by a constituent entity of an international group for the accounting year 2021-22.
Income Tax: Statement of Income Distribution (Income tax Form 64) Financial Year 2021-22 30-Nov-22 Statement of income distribution by Venture Capital Company or venture capital fund in respect of income distributed during the previous Year 2021-22.
Income Tax : Form 64D Financial Year 2021-22 30-Nov-22 Statement to be furnished in Form No. 64D by Alternative Investment Fund (AIF) to Principal CIT or CIT in respect of income distributed (during the previous year 2021-22) to unit holders.
Income Tax : Form 64A Financial Year 2021-22 30-Nov-22 Due date for filing of a statement of income distributed by business trust to unit holders during the FY 2021-22.
Income Tax : Tax deduction at source Challan cum Statement Oct-22 30-Nov-22 Due date for furnishing of challan-cum-statement in respect of tax deducted under section 194S in the month of Oct 2022. Tax deduction at source is deducted on payment made for the transfer of Virtual Digital Asset u/s 194S.
Income Tax : Tax deduction at source Return Jul-Sep, 2022 30-Nov-22 “Quarterly statement of Tax deduction at source deposited for the quarter ending September 2022. The due date for furnishing of the Tax deduction at source statement for the quarter ending September 2022 has been extended from Oct 31, 2022, to Nov 30, 2022, vide Circular no. 21/2022, dated 27-10-2022”.

Labour Law :

Labour Law Provident Fund / Employees’ State Insurance Scheme Oct-22 15-Nov-22 Due Date for payment of Provident fund and Employees’ State Insurance Scheme contribution for the previous month.

For taxpayers, the month of November 2022 is important since it has timelines for a lot of compliances with the Goods and Services Act, Income Tax Act, Companies Act, and LLP Act. You avoid costly fines, make sure to submit the aforementioned forms within the deadlines. As a result, we encourage you to plan ahead of time and finish all necessary filings before the time allotted and due date expire.