It is generally found that we receive tds default notice due to wrong selection of flag in TDS returns.  Therefore it is beneficial  to know for all deductors regarding value of Flags which are explained below :-





[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY,
PART-II, SECTION 3, SUB-SECTION (ii)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
(CENTRAL BOARD OF DIRECT TAXES)

NOTIFICATION NO. 21/2012 [F.No.142/10/2012-SO(TPL)] S.O. 1323(E), DATED 13-6-2012
In exercise of the powers conferred by sub-section(1F) of section 197A of the Income-tax Act, 1961 (43 of
1961), the Central Government hereby notifies that no deduction of tax shall be made on the following
specified payment under section 194J of the Act, namely:-
Payment by a person (hereafter referred to as the transferee) for acquisition of software from another person, being a resident, (hereafter referred to as the transferor), where-
(i) the software is acquired in a subsequent transfer and the transferor has transferred the software without any modification,
(ii) tax has been deducted-
(a) under section 194J on payment for any previous transfer of such software; or
(b) under section 195 on payment for any previous transfer of such software from a non-resident, and
(iii) the transferee obtains a declaration from the transferor that the tax has been deducted either under sub-clause (a) or (b) of clause (ii) along with the Permanent Account Number of the transferor.
2. This notification shall come in to force from the 1st day of July, 2012.
(J. Saravanan)
Under Secretary(TPL-III)
In case of no deduction on account of payment under section 197A (1F).
NOTIFICATION NO. 56/2012 [F. NO. 275/53/2012-IT(B)], DATED 31-12-2012
In exercise of the powers conferred by sub-section (1F) of section 197A of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies that no deduction of tax under Chapter XVII of the said Act shall be made on the payments of the nature specified below, in case such payment is made by a person to a bank listed in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934), excluding a foreign bank, namely:-
(i)  bank guarantee commission;
(ii)  cash management service charges;
(iii)  depository charges on maintenance of DEMAT accounts;
(iv)  charges for warehousing services for commodities;
(v)  underwriting service charges;
(vi)  clearing charges (MICR charges);
(vii)  credit card or debit card commission for transaction between the merchant establishment and acquirer bank.
2. This notification shall come into force from the Ist day of January, 2013.

Income Tax Department has disallowed relief u/s 89(1) which was claimed by Assessee during his/her filing of Income Tax Return for the Assessment Year 2015-16.   Earlier there was no doubt in claiming such relief  upto A.Y. 2014-15 from Income Tax Department. Simply Assesee claims in ITR form and Income Tax Department allows the same as claimed by Assessee.

                But now, w.e.f. Assessment Year 2015-16, It is compulsory  to upload online 10E form otherwise claim will be rejected and demand will be raised by I.T. Department.



                All  Assessees who had claimed rebate u/s 89(1) in the A.Y. 2015-16 have been informed by Income Tax Department through intimation order under section 143(1) that claim amount of rebate has been rejected and raised demand alongwith interest for the same.


Procedure to upload 10E Form
                 After reading above content it is clear without uploading 10E form , relief under section 89(1) can not be claimed.  Now question is that how can we upload 10E Form alongwith ITR-1 (Sahaj), ITR-2  etc Forms.

                    After a time gap, it has been found that 10E form is not ITR forms.   10E form is other that ITR form which is available in income tax website  after login for efiling of  incometaxindiaefiling.gov.in as shown in below picture.

Click here to download free calculator relief u/s 89(1) or generation of 10E forms (Link Update soon)

New / Revised TDS rates for the Financial Year 2015-16 or Assessment Year 2016-17
Deductor always think about the TDS Rates.  Deductor deduct TDS on behalf of Income Tax Department and deposit the same accordingly.   But there is fear regarding change of TDS rates.

In case TDS rates have been reduced and deductor deduct / deposit higher rates (as earlier applicable) then Income Tax department has no problem.  In other side in case TDS rates goes on higher side and deductor deduct / deposit lower rate (as earlier applicable) then Income Tax department raises demand notice to deductor that you have not deducted TDS accordingly to TDS rates and you have to deposit the balance TDS with Interest.



 However Deductor should read below TDS  Rates before deducting TDS for the Financial Year 2015-16 or Assessment Year 2016-17

Click here
to view the table of TDS Rates. (Official Link)

What is Form 16?
Form 16 is a Certificate of TDS (Tax deducted at Source) i.e. tax deducted on your Salary by your
Employer and deposited with the Government on your behalf.
It reflects the details of your Gross Salary, the exempt allowances, your Other Income if any, details of
Investments made and deductions availed.
Thereafter, your tax liability, TDS made, and tax payable/refundable (If any).
Form 16 needs to be compulsorily issued if tax is deducted on your Salary. It is the responsibility of the
Employer to issue Form 16.
How do I confirm the TDS shown in my Form 16 is actually correct?
It is the prime responsibility of the Employer to furnish accurate details in Form 16,
failure of which attracts penalty to the employer.
Nevertheless, tax authorities recently have empowered the deductees (Employee on
whose Salary TDS is made) to cross‐verify the TDS details against the records available
with the Government.

Tax Information Network (TIN; a division of the Income‐tax department) has introduced
in recent years, the Form 26AS wherein any tax deducted at source on any of your
income is reflected. Thus, you can cross‐verify whether the tax that has been deducted
is actually paid to the government or not?
It is compulsory to file my Return of Income?

Yes. As per the Income‐tax Act, every person whose Gross Total Salary exceeds the basic
exemption limit  has to file a Return of Income (ROI). Failure to file the Return of Income
can expose to a penalty of Rupees Five Thousand and also, the laws do not permit
payments of your Refunds (If any) when the Income Tax Return is not filed.
It is a good policy and a willful conduct to keep your financial and tax records updated
so that you do not have to face hurdles while applying for Business loans, Home loans,
Insurance policies, etc. Filing of Income tax Return should be seen as a good habit and
not as compliance burden.

By when I have to file my Return of Income?
For salaried individuals the due date of filing of Tax Return is 31st July of Assessment
Year (eg. For F.Y. 2014‐15, due date will be 31st July 2015 (extended this year only up to 31st August 2015)

I have not filed my earlier years Income‐tax Return. Can I file them now?
Yes. You can file Income‐tax Returns of earlier years as well. That means if you had not
claimed your Refund of last year due to non‐filing of Income‐tax Return, you can still do
it now!
I had not submitted few Investment proofs to my Employer. What do I do now?
The Employer is under obligation to consider all Investment proofs provided by you.
However, if you miss on providing any details/proofs you can always claim the
investments in your Income‐tax Return and claim your Refund, since your Employer has
already deducted the extra tax on the investment‐portion for which you had not
provided the proofs.

How do I reduce my tax liability?
There are many many Investment options which reduce your tax liability.
Section 80C provides you relief till Rs. 1.5 lac. Various Investments/expenses
enumerated under Sec. 80C. They are listed below:
a. Life Insurance premiums ( of self and family)
b. Provident Fund contributions (of self and family)
c. Mutual Fund contributions
d. Public Provident Fund (PPF)
e. Tuition Fees (of self and family)
f. Principal portion of EMI of the Housing loan
g. Fixed Deposit with Banks for 5 years
h. NABARD and other Bonds / Certificates as specified from time to time.
Following are additional deductions which are over and above the Rs.1.5 lac limit as
mentioned above:
a. Health Insurance premium up to Rs.15,000/‐ (under section 80D) for senior citizen
upto Rs. 20,000/‐.
b. Full Interest on Education loan u/s 80E
c. Donations u/s 80G
d. Interest portion of EMI of Housing loan up to Rs. 2 lacs (section 24). (Consequently,
benefit can be availed on the principal and the interest expenses.)
How do I get maximum benefit of HRA?
House Rent Allowance is exempt the least of the following:
a. HRA actually received
b. Rent paid in excess of 10% of Salary
c. 50% of Salary (Rent paid in Metro City **D M C K ) or 40% of Salary (Non‐metro city)
**D‐ Delhi, M‐ Mumbai, C‐Chennai, K ‐ Kolkata
How does my House Property Loan help me in tax savings?
Repayment of house loan can be bifurcated in 2 parts:
a. Principal amount allowed till Rs. 1.5 lac u/s 80C
b. Interest amount allowed till Rs. 2 lacs u/s 24
If you have House loan on more than one property, the interest repaid on second home is
exempt without any limit.

I had switched my employment during the year. What about my TDS made by
earlier Employer?
It is the responsibility of the employee to furnish to the new employer the details of
Salary and TDS made thereon by the previous employer. Only if such details are
furnished, the new employer shall take into account the salary and TDS details and
calculate TDS to be made in future accordingly.

How do I file my Return of Income?
People having only Salary and/or House Property and/or Other Income need to file their
Income‐tax Return in Form ITR‐1. This may be submitted either physically (if taxable
income not exceeds Rs. 5 lacs) or online.

Income Tax Department is circulating again and again that there is no Extension in Due date for filing of Income Tax Return which is 30th Sep, 2015 for the Assessment Year 2015-16.  

 On 28th Sep, 2015, the below mentioned press release has also been released by CBDT confirming that there is no Extension of Due Date for filling of Audit report and return of Income for the Assessment Year 2015-16.


.

Sub: Circulation of Fake order for extension of due date for filing of Audit report and return of Income for Assessment Year 2015-16- regarding

It has been brought to the notice of the Government that a fake order dated 26th September 2015 supposedly under section 119 of the Income-tax Act 1961 under the signature of one Upmanyu Reddy, Under Secretary to the Government of India is in circulation. The fake order extends the due date for filing of audit report under section 119 of the Income-tax Act to 15 October 2015.

It is clarified the order is fraudulent. The Government has not extended the due date for filing of returns and audit report due by 30th September 2015. Tax payer and practitioners are advised not to give any credence to the fraudulent order purportedly signed by one Upmanyu Reddy.

Some major changes have been done in TDS/TCS return utility and it's FVU regarding addition or correction in Challans, Removal of nature of remittance in 27Q etc.  Therefore please go through the below details before submitting TDS Return of the 2nd Quarter of F.Y. 2015-16 and onwards.  This FVU is applicable w.e.f. 29-09-2015


Key Features – Return Preparation Utility (RPU) version 1.3 

- Preparation of Regular and Correction TDS/TCS Statement(s) for Form 24Q, 26Q, 27Q & 27EQ pertaining to Financial Year 2007-08 onwards (for all quarters).

- Section code 192A: In addition to Form no. 26Q, this section will also be applicable for Form no. 27Q where the date of payment to deductee is on or after 01/06/2015.

- Discontinuation of C9 Correction Statements: As directed by Income Tax Department (ITD), C9 correction i.e. addition of new Challans in Correction Statement(s) has been discontinued.

- Removal of nature of remittance (applicable only in case of Form no. 27Q): As directed by ITD, below mentioned nature of remittances has been removed from the list.
         o Commission
         o Payments to sports person & artists
         o Winning from horse races
         o Winning from lotteries, crossword puzzles, card games and other games of any sort

- Incorporation of latest File Validation Utility (FVU) version 4.8 (applicable for TDS/TCS statements pertaining to FY 2010-11 onwards) and FVU version 2.144 (applicable for TDS/TCS statements from FY 2007-08 upto FY 2009-10)

Key Features – File Validation Utility (FVU) version 4.8

- Section code 192A: In addition to Form no. 26Q, this section will also be applicable for Form no. 27Q where the date of payment to deductee is on or after 01/06/2015.

- Discontinuation of C9 Correction Statements: As directed by Income Tax Department (ITD), C9 correction i.e. addition of new Challans in Correction Statement(s) has been discontinued.

- Removal of nature of remittance (applicable only in case of Form no. 27Q): As directed by ITD, below mentioned nature of remittances has been removed from the list.
      o Commission 
      o Payments to sports person & artists 
      o Winning from horse races 
      o Winning from lotteries, crossword puzzles, card games and other games of any sort 

- This version of FVU will be applicable with effect from September 29, 2015.

CLICK HERE to Download RPU 1.3 with FVU 4.8 

Income Tax Department has confirmed through it's Notification No F.No.225/207/2015/ITA.II dated 01-10-2015 that the due date for e-filing of Income Tax Return and audit reports u/s 44AB has been extended up to 31th October, 2015 which was earlier 30th September 2015.   Detailed notification issued by CBDT is given below :-