Income Tax Return: Be Ready to Pay Higher TDS if you Do Not Do this by March 31

 










If you have not linked your Permanent Account Number or PAN with Aadhaar card, be ready to pay higher Tax Deducted at Source (TDS) from next month. The last date for linking your Aadhaar number and PAN has been extended to March 31. Failing to link these two documents within the mentioned deadline, will have an impact on your debit and credit card payments, online transactions, cash withdrawal from ATMs among others.

According to the Section 139AA of the Income Tax Act, every individual with PAN as on July 1, 2017 and is eligible to obtain Aadhaar, must link these two documents. Over the last three years, the Central Board of Direct Taxes (CBDT) has extended the last date of linking Aadhaar card number with PAN several times. If the PAN is not linked with Aadhaar before the due date, then the PAN will become inoperative, under Section 114AA (3) of Income Tax Act. For those who are applying for new PAN cards, it is mandatory to quote Aadhaar numbers, as per Section 139AA of Income Tax Act.

Be Ready to Pay Higher TDS if you Miss the Deadline

If PAN becomes inoperative, the income tax department will consider that the individual has not submitted PAN and therefore liable to face the consequences for the same. As per Section 206AA(6) of the Income Tax Act, taxpayers who get a taxable income, must submit their PAN card details. If the PAN provided by the taxpayer is invalid, it shall be deemed that deductee has not furnished his PAN to the deductor, according to Section 206AA(6) of the Income Tax Act.

So if you miss the deadline of March 31 and your PAN card become inoperative due to not linking it with the Aadhaar card, then you have to pay TDS at the highest rate of 20 per cent, as per Section 206AA of the Act. The higher rate of TDS will be applicable on interest on fixed deposit, dividend and other income which are currently subject to TDS.

Explaining the new rule for the investors, Abhishek Soni, co-Founder, Tax2win said, “If we fail to link the Aadhaar with PAN then a higher rate of TDS i.e. 20 per cent will be levied on income which is eligible for tax deduction. For instance, TDS rate on FD interest is 10 per cent if the interest amount exceeds Rs. 40,000 but according to section 206AA, if the Aadhaar is not linked with the PAN then the TDS will be deducted at 20 per cent."

PAN-Adhaar Linking: Rs 10,000 Fine Every Time you Fail to Furnish PAN

According to Section 272B of Income Tax Act, a penalty of Rs 10,000 can be levied in case PAN is not quoted or furnished as required by the Income Tax Law. Under the provisions, a penalty could be imposed for every such non-compliance. A penalty of Rs 10,000 can also be levied upon defaulter each time the individual fails to furnish PAN card details. This fee will be in addition to the other consequences, such as PAN becoming inoperative due to non-intimation of Aadhaar, higher TDS rates, and so on," said Ruchika Bhagat, managing director, Neeraj Bhagat & Co.


Download our App to get knowledge updates: https://play.google.com/store/apps/details?id=com.app.gstmitra



Join Our Telegram Channel for more updates:https://t.me/praveengst














Comments

Post a Comment

Popular posts from this blog

Centre appeals against ruling on levy of GST on maintenance charges to resident welfare associations

Image
  The Centre has preferred a writ appeal before the Madras High Court against a single judge's order that flat or villa owners paying more than ₹7,500 a month towards maintenance charges to their residents’ welfare associations must pay Goods and Services Tax (GST) at the rate of 18% only for the amount exceeding ₹7,500 and not for the entire monthly contribution. Justices T.S. Sivagnanam and Sathi Kumar Sukumara Kurup on Wednesday allowed an application filed by the Centre to dispense with production of a certified copy of the judgment passed by Justice Anita Sumanth recently and directed the Registry to list the appeal for admission in the usual course. Justice Sumanth had in July this year quashed an order passed by the Authority for Advance Ruling (AAR) on June 21, 2019 as well as a consequent circular issued by the Department of Revenue under the Union Finance Ministry on July 22, 2019 since both of them had insisted upon collecting GST for entire monthly contribution. The jud...
Read more

Seven key things to know before filing income tax return (ITR) for FY21

Image
  The last date to file income tax return for the financial year 2020-21 has been extended to September 30, 2021. Although there is more than two months left for the deadline to end, it is always recommended to complete the task as soon as possible and not to wait for the last minute. Worth mentioning here is that the income tax department last month launched a new e-filing portal (www.incometax.gov.in) to speed up the processing of tax returns. The I-T department will soon launch a mobile application, having all the features of the new portal. This year taxpayers have to take care of the following changes in the ITR filing process. 1) A new utility named JSON has been launched for filing tax return forms for FY21. At present, only three forms, ITR 1, 2 and 4 have been released. These new forms will import pre-fill data such as personal details, salary income, dividend income, interest income, capital gains and all the information available in Form 26AS. 2) Taxpayers will have the ...
Read more

Income Tax Dept detects ₹350 cr unaccounted cash receipts after raid in Rajkot

Image
  The Income Tax Department carried out a search and seizure operation on a real estate group based in Gujarat's Rajkot and found unaccounted cash receipts in various projects of approximately ₹350 crore, the Finance Ministry said on Friday. The group is among Gujarat’s prominent real estate builders and developers and is actively engaged in real estate, construction and land trading businesses in and around Rajkot. More than 40 premises were covered in the search operation. During the course of operation, many incriminating documents and digital evidences were seized indicating involvement of the group in unaccounted transactions. The IT sleuths found substantial evidence of transactions outside the regular books of accounts, unaccounted cash expenses, cash advances received and interest paid in cash. Evidence of on-money payments in real estate projects-flats, shops and land deals has also been found. Total unaccounted cash receipts in various projects of approximately ₹350 crore...
Read more