Income Tax Return: Attention Income Taxpayers! If you are not filing income tax return for the last two years, then from July 1, you may have to pay more TDS or TCS.
Income Tax Return: Attention Income Taxpayers! If you are not filing income tax return for the last two years, then from July 1, you may have to pay more TDS or TCS. According to the Finance Act 2021, taxpayers who have not filed income tax returns for the last 2 years and TDS (Tax Deduction at source) or TCS (Tax collection at source) in both the previous years was more than Rs 50,000, then in such cases now This year, from July 1, 2021, his TDS will be deducted at twice the existing effective rate or 5 per cent, whichever is higher. According to the new TDS rules, these provisions have been implemented under section 206AB of the Income Tax Act 1961.
What will be the benefit to the government?
Tax expert CA Manish Gupta says, this provision means that the payer will have to ask for a copy of the income tax return of the last 2 years from him while deducting TDS and if not provided, the rate of TDS will double. By doing this, the government is serving many of its interests. First of all, it wants to increase the number of income tax filers rapidly. Second, in this era of epidemic, the government wants to collect more tax, if it has to be refunded later, then it will be after 1 year. That is, funds will be provided to the government immediately. Apart from this, the government also wants people to make a habit of filing income tax returns on time.
Think of TDS deduction like this
CA Manish Gupta says, understand this provision in such a way that if 1 percent or 2 percent TDS of a person or company is deducted, his TDS will now be deducted at 5 percent and similarly if someone’s TDS is deducted 10 percent, then now his TDS 20 percent. rate will be deducted. Apart from this, the government wants to keep a special watch on those people whose TDS is deducted but those people do not want to submit the return. It is estimated that the government will gradually reduce this limit of 50,000 to zero in the next 5 years.
What to do when tax is deducted without taxable income?
CA Gupta explains, in such a situation, there is also a question that what will happen if someone does not have taxable income in the last 2 years while TDS has been deducted. According to the Income Tax Department, even if your income is not taxable, you can still file your return and get your refund.
This section (Section 206AB) of the Income Tax Act will not apply to the salaried employees. Similarly, this provision will not apply to non-resident persons also. For example, if a foreign player comes to India and TDS is deducted on his income here, then this provision will not be applicable and TDS will be deducted at the normal rate. However, giving relief to the weak and middle class, the government has added a condition in it that this provision will not be applicable to the taxpayers who have not deducted TDS or TCS of 50,000 or more in the last 2 years.
What should taxpayers do?
According to the new provisions, if you want to avoid the net of double TDS, then you have to file a return of whatever income you have, whether taxable or not. Similarly, if a person has turned 18 last year or this year and did not have taxable income before that, his return can still be filed. Let us tell you, according to the Income Tax Act, all individuals can file their income tax return whether they are adults or not. Similarly, if a company is formed in the previous year itself, then it should file its return for the previous year.
