If you haven’t filed your Income Tax Returns (ITR), it’s excessive time that you just do it earlier than July 1 as failing to achieve this would appeal to a better TDS/TCS fee, in accordance to the Finance Act, 2021. The Finance Act has revamped the scope of tax assortment from the very supply in order that right earnings reporting is ensured by each assessee.
Come July 1, an individual will be compelled to pay additional TDS and that too at a better fee if he/she fails to file their Income Tax Returns for the final two years and has combination TDS/TCS credit score of Rs. 50,000 or extra in every of the 2 years.
The Section 206AB of the Income Tax Act 1961 states that the brand new TDS fee levied could be the best of:
- – Double the speed specified within the related provision of the Income Tax Act; or
- – Double the speed of charges in drive; or
- – At the speed of 5 p.c.
Meanwhile, for TCS assortment, the speed underneath part 206 CCA of the Act will be increased and it will be double the speed talked about within the related part; or 5 p.c.
Where new rule will not apply
Now Section 206AB of the Act will not be helpful for TDS deduction underneath sections 192 (Salary); 192A (Payment of accrued steadiness due to an worker); 194B (Winnings from lottery or crossword puzzles); 194BB (Winnings from horse race); 194LBC (Income from funding in securitization belief); and 194N (Cash withdrawals).
Section 206AB will additional not be relevant to non-resident deductee/collectee, who don’t have a everlasting institution in India.
If each part 206AA (increased TDS fee in case of no PAN) and part 206AB of the Act are relevant, then the TDS fee will be a lot increased than the TDS charges in accordance to the aforesaid sections.
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