View the Tax Credit Statement
New facility added in "My Account" for registered E-filers to View the Tax Credit Statement (Form 26AS) to verify if the tax payments made by you or TDS deducted from salary or interest etc are correctly reported to the Department.
https://incometaxindiaefiling.gov.in/portal/index.jsp
Service tax from July 1
Those looking to book a house should do so before July 1. All sales of under-construction houses from July 1 will attract service tax with the finance ministry notifying tax on new services.
However, service tax on rail freight has been further put off till January, 2011. The government has also exempted electricity distribution from service tax.
The Central Board of Excise and Customs, the apex indirect taxes body, has issued several notifications related to separate areas to enforce the provisions of the Finance Act 2010.
Sale of immovable property will be deemed to be taxable unless entire consideration is paid after the issuance of completion certificate by a competent authority. However, service tax will be levied only on 25% of the gross sale value of property. Low-cost housing under the Jawaharlal Nehru National Urban Renewal Mission and the Rajiv Awas Yojana have been exempted from service tax that will begin to be levied from July 1.
Service tax on air travel has been capped at Rs 100 for domestic travel and Rs 500 for international travel. The government has exempted foreign travellers from service tax if they are in transit to a different country without passing the immigration and Customs area.
Further, those flying to and from the Northeastern states —Arunachal Pradesh, Assam , Manipur, Meghalaya, Mizoram , Nagaland, Sikkim, Tripura and Baghdogra (in West Bengal)—have also been exempted from service tax.
Sports events such as Indian Premier League will attract service tax but tax exemption has been allowed to tournaments and championships organised by certain bodies such as national sports federations or federations affiliated to them. These include School Games Federation of India, Association of Indian Universities and Olympic Committee of India, among others.
The government has also exempted certain services that are provided within ports and airports from tax. These include supply of water, supply of electricity, medical treatment, formal education, fire service agencies and pollution control services.
Eight new services under service tax net from July 1
The government had introduced eight new services in the Budget liable to service tax from July 1, 2010. It would be pertinent to relook at what these are:
1) Services of promoting, marketing, or organising of games of chance, including lottery.
Service provided by any person who is appointed by the state government to advertise, promote and sell lottery tickets and services provided in relation to promotion or marketing or organising, or assisting in organising games of chance, including lottery, bingo, lotto or online games, whether or not conducted through internet or other electronic networks, is covered under this service. Now agents selling lottery tickets, whether in physical form or online, will be covered under service tax.
2) Health service provided by a hospital, nursing home, or multi specialty clinic
l To an employee of any business entity, in relation to health check-up or preventive care, where the payment for such check-up or preventive care is made by such business entity directly to such hospital, nursing home or multi-specialty clinic; or
l to a person covered by health insurance scheme, for any health check-up or treatment, where the payment for such health check-up or treatment is made by the in insurance company directly to such hospital, nursing home or multi-specialty clinic.
3) Service provided of maintenance of medical records of employees of a business entity.
Service provided by any person in relation to storing, keeping and maintaining of medical records of the employees of the business entity is covered under this service. Records maintained by designated hospitals or by the independent record keepers for a charge are also brought under service tax.
4) Services of promoting of a 'brand' of goods, services, events, business entity etc..
Service provided to any other person, by any other person, through a business entity or otherwise, under a contract for promotion or marketing of a brand of goods, service, event or endorsement of name, including a trade name, logo or house mark of a business entity by appearing in advertisement and promotional event or carrying out any promotional activity for such goods, service or event.
5) Services of permitting commercial use or exploitation of any event organised by a person or organisation.
Service provided to any person, by any other person, by granting the right or by permitting commercial use or exploitation of any event including an event relating to art, entertainment, business, sports or marriage organized by such other person.
The service now seeks to tax the amount received by the person or organisation, who permits the recording and broadcasting of the event from the broadcaster, or any other person, who seeks to commercially exploit the event.
6) Service provided by electricity exchanges.
Service provided by an electricity exchange in relation to trading, processing, clearing or settlement of spot contracts, term ahead contracts, seasonal contracts, derivatives and any other contract but does not include the transmission of electricity. The proposed new service seeks to tax the charges recovered for services in relation to assisting, regulating, controlling the business of trading, processing and settlement pertaining to sale or purchase of electricity by the associations authorised by Central Electricity Regulatory Commission.
7) Special services provided by a builder etc. to the prospective buyers such as preferential location or external or internal development of complexes on extra charges.
Service provided by the builder of residential or commercial complex or by any other authorised person appointed by such builder or providing preferential location or development of such complex covered under this service. But it does not cover services in relation to repair and maintenance, commercial or industrial construction of complex and in relation to parking place.
(a) prime/preferential location charges for allotting a flat/commercial space according to the choice of the buyer (i.e. Direction- sea facing, park facing, corner flat; Floor- first floor, top floor, Vastu- having the bed room in a particular direction; Number- lucky numbers);
(b) internal or external development charges which are collected for developing / maintaining parks, laying of sewerage and water pipelines, providing access roads and common lighting etc;
(c) fire-fighting installation charges; and
(d) power back up charges etc.
8) Services related to two types of copyrights hitherto not covered under existingtaxable service 'Intellectual Property Right (IPR)', namely, those on (a) cinematographic films; and (b) sound recording.
l Service provided to any person, by any other person, for—
(a) Transferring temporarily; or
(b) Permitting the use or enjoyment of any copyright defined in the Copyright Act, 1957, except the rights covered under sub-clause (a) of clause (1) of Section 13 of the said Act.
The Budget had modified the existing category of commercial and industrial construction as well as construction of residential complex to provide that the construction of new building or residential complex intended to sale (wholly or partly) whether before or during or after the construction shall be deemed to be a taxable service provided by the builder. If the builder doesn't receive any consideration from the buyer before the issuance of a completion certificate then such sale would not be considered as a taxable service.
A lot of representation were received by the CBEC with regards to issue of completion certificate by the authorities as there were a lot of delays in the issue of the same due to one reason or the another and hence the CBEC has notified the following persons as competent authority to issue completion certificates.
(i) Architect registered with the Council of Architecture constituted under the Architects Act, 1972( 20 of 1972); or
(ii) Chartered engineer registered with the Institution of Engineers (India); or
(ii) Licensed surveyor of the respective local body of the city or town or village or development or planning authority;
The CBEC had in the Budget proposed to levy service tax on passengers travelling by air transport from any airport in India for domestic and international journey. Now from July 1, 2010 any person undertaking a domestic journey will have to pay 10% of the gross fare or Rs 100, whichever is less, & any person undertaking an international journey will have to pay 10% of the gross fare or Rs 500, whichever is less.
The government has exempted transit passengers who don't pass through immigration and doesn't leave customs area and continues his journey to a place outside India; and a person employed or engaged by the aircraft operator in any capacity on board the aircraft from the levy of this tax.
Passengers embarking on a journey originating or terminating in an airport located in Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura or Baghdogra (in West Bengal) are also exempted from service tax under this category.
From July 1, 2010 the service providers who provide service under commercial or industrial construction & construction of complex will now have to charge service tax only on 25% of the value of the service as against on 33% previously charged. This is in line with the exemption which is provided to builders under the new category.
In the Budget the exemption given to sporting events from paying service tax on sponsorship was removed but now it is provided that tournaments and championship organised by India Olympic Association, National Sports Federation etc are exempted from paying service tax on the sponsorship amount.
Service tax on Transport of goods by railway has been postponed till January 1, 2011
New Changes in TDS Rules
CBDT Press Release No. 402/92/2006-MC (27 of 2010), dated 2-6-2010
The Central Board of Direct Taxes (CBDT) have amended the Rules relating to TDS provisions date and mode of payment of tax deducted at source (TDS), TDS certificate and filing of 'statement of TDS' (TDS return) vide Notification No. 41/2010; SO No. 1261(E) dated 31.05.2010. The amended rules will apply only in respect of tax deducted on or after 1st day of April 2010.
Forms for TDS certificate have been revised to include the receipt number of the TDS return filed by the deductor. Now the Tax-deduction Account Number (TAN) of the deductor, Permanent Account Number (PAN) of the deductee, and Receipt number of TDS return filed by the deductor will form the unique identification for allowing tax credit claimed by the taxpayer in his income-tax return.
Government Authorities (Pay and Accounts Officer or Treasury Officer or Cheque Drawing and Disbursing Officer) responsible for crediting tax deducted at source to the credit of the Central Government by book-entry are now required to electronically file a monthly statement in a new Form No. 24G containing details of credit of TDS to the agency authorised by the Director General of Income-tax (Systems).
Due date for furnishing TDS return for the last quarter of the financial year has been modified to 15th May (from earlier 15th June). The revised due dates for furnishing TDS return are
| Sl. No. | Date of ending of the quarter of the financial year | Due date |
| 1. | 30th June | 15th July of the financial year |
| 2. | 30th September | 15th October of the financial year |
| 3. | 31st December | 15th January of the financial year |
| 4. | 31st March | 15th May of the financial year immediately following the financial year in which deduction is made |
Due date for furnishing TDS certificate to the employee or deductee or payee is revised as under :
| Sl. No. | Category | Periodicity of furnishing TDS certificate | Due date |
| 1. | Salary (Form No.16) | Annual | By 31st day of May of the financial year immediately following the financial year in which the income was paid and tax deducted |
| 2. | Non-Salary (Form No.16A) | Quarterly | Within fifteen days from the due date for furnishing the 'statement of TDS' |
Concept of Unique Identification Number :
Now the Tax-deduction Account Number (TAN) of the deductor, Permanent Account Number (PAN) of the deductee, and Receipt number of TDS return filed by the deductor will form the unique identification for allowing tax credit claimed by the taxpayer in his income-tax return.
Summary of main changes :
| S. No. | Existing | Amended |
| 1. | Amount Credited in Mar. can be deposited by 31st May | Amount Paid/Credited in March, can be deposited by 30th April |
| 2. | Issuing Form 16 by 30th April | Issuing Form 16 by 31st May |
| 3. | Issuing Form 16A monthly or consolidated yearly certificate | Mandatory Quarterly TDS Certificate within 15 days of submitting eTDS statement |
| 4. | Submitting Q4 eTDS statement by 15th June | Submitting Q4 eTDS statement by 15th May |
| 5 | - | Major changes for Govt deductors |
| 6 | - | Credit of tax deposited thru TAN, PAN and |
Last date for ETDS QTR-IV is 15-06-2010.
I-T exemption limit for gratuity upped to Rs 10 lakh
The government today raised the income tax exemption limit on gratuity from Rs 3.5 lakh to Rs10 lakh, with effect from May 24. "Employees who retire, become incapacitated, terminated, or die on or after May 24, 2010, will get I-T exemption for gratuity up to Rs 10 lakh," a Finance Ministry official said here. The Finance Ministry today notified a rule in this regard, the official added. Earlier, the Parliament had approved raising the limit of gratuity to be exempted from income tax. The Payment of Gratuity (Amendment) Bill, 2010, was passed by the Parliament in this regard in the Budget session. While the Sixth Pay Commission had raised the limit for Central Government employees, the Cabinet later enhanced the ceiling for the private sector workforce as well
Govt plans new norms to tax profits by Indian firms abroad
The finance ministry plans to introduce Controlled Foreign Company (CFC) rules to check outbound investment in tax havens for avoiding or deferring tax. The rules will allow authorities to extend domestic laws for taxing profits of Indian subsidiaries abroad.
Now, profits made by foreign arms of Indian companies are taxed only when they are distributed through dividend to the parents.
Many Indian companies avoid or defer bringing back profits to India and instead, deploy the funds for overseas expansion. This results in delayed or non-payment of tax on profits made by foreign arms.Introduction of CFC rules would require an amendment to the Income Tax Act. The government can either introduce the rules in the Finance Bill of 2011 or make the provisions in the second draft of the Direct Taxes Code, likely to be released for public discussion this month.
"A committee under the director general of Income Tax (international taxation) was formed to give its recommendations on taxing income of CFCs to boost the government's revenues. The committee recently submitted its report to Central Board of Direct Taxes (CBDT) Chairman S S N Moorthy," a senior official in the finance ministry told Business Standard on condition of anonymity.
CFC rules have been adopted by many developed countries like the US, the UK, Japan and Germany, where outbound investments have exceeded capital inflows. The idea has been opposed by some quarters in India on the ground that the country is not prepared for such a regime. The argument is that capitals inflows are still higher than outflows.
"The market has matured enough to have such rules. Outbound investments have showed a significant rise in the last few years. CFC rules will help us prepare for eventuality in case outward investments surpass inward capital flows. It is an enabling mechanism," said another finance ministry official.
S P Singh, senior director, Deloitte, said the rules would not affect outward investment by Indian companies, and instead, this would provide more clarity regarding taxation of foreign subsidiaries. "The rules will not impact small investors. These are to check tax avoidance by large investors. Whenever outward investments go beyond a minimum threshold, such rules come into the picture," Singh said. He added profits of an overseas arm could be taxed in proportion to the parent company's investment into it.
In January 2003, a working committee on non-resident taxation under Vijay Kelkar had recommended introduction of CFC regime in India, terming deferral of taxes as an unjustifiable loss of revenue.
Normally, CFC rules do not apply when the foreign subsidiary is listed or distributes a particular percentage or profits every year. Also, when it is in a high-tax jurisdiction and not set up with the intent of evading taxes, or when its total income does not exceed a particular threshold, CFC rules do not apply.
-CA.RAJU SHAH
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