Weekly Taxation Newsletter Period 13/07/22 to 19/07/2022

Dear Readers,

We are delighted to share our 82nd E-Newsletter “Weekly Taxation Newsletter” dated 12th July, 2022 from 05th July, 2022 to 12th July, 2022 with you. This E – Newsletter is a weekly reference / compilation of interesting and latest news related to tax including upcoming Timelines / Due Dates, Notifications / Press Information, Case Laws, International Taxation etc.

                                                                                                                                                                                                                                                   Stay updated, Stay connected

  • Due Dates under IT Act 1961
 

 

Sl.

 

Compliance Particulars

 

Due Dates

1

Due date for furnishing of challan-cum-statement in respect of tax

deducted under section 194-IA, 194-IB, 194-IM, in June 2022.

30.07.2022

2.

Quarterly TCS certificate in respect of tax collected by any person for the

quarter ending June 30, 2022.

30.07.2022

3

Quarterly statement of TDS deposited for the quarter ending June 30, 2022.

31.07.2022

 

4

Return of income for the FY 2021-22 for all assessee other than:

·         corporate-assessee

·         non-corporate assessee (whose books of account are required to be audited) or

·         partner of a firm whose accounts are required to be audited

·         Assessee who is required to furnish a report under section 92E.

 

31.07.2022

5

Quarterly return of non-deduction of tax at source by a banking company

from interest on time deposit in respect of the quarter ending June 30, 2022.

31.07.2022

A. Under the GST, 2017Filing of GSTR –3B / GSTR 3B QRMP

 a) Taxpayers having aggregate turnover > 5 Cr. in preceding FY

Tax period

 

Due Date

Particulars

 

 

June, 2022

 

 

20th July, 2022

Due Date for filling GSTR – 3B return for the month of June, 2022 for the taxpayer with Aggregate turnover exceeding INR 5 crores during previous year.

 

Due Date for filling GSTR – 3B return for the quarter of January to March 2022 for the taxpayer with Aggregate

  

turnover up to INR 5 crores during the previous year and who has opted for Quarterly filing of return under QRMP.

b). Taxpayers having aggregate turnover upto Rs. 5 crores in preceding FY (Group A)

Tax period

 

Due Date

Particulars

 

 

June, 2022

 

22nd July, 2022

Due Date for filling GSTR – 3B return for the month of June, 2022 for the taxpayer with Aggregate turnover upto INR 5 crores during previous year and who has opted for Quarterly filing of GSTR-3B

Group A States: Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, Daman & Diu and Dadra & Nagar Haveli, Puducherry, Andaman and Nicobar Islands, Lakshadweep

c). Taxpayers having aggregate turnover upto Rs. 5 crores in preceding FY (Group B)

Tax period

 

Due Date

Particulars

June, 2022

24th July, 2022

Annual Turnover Up to INR 5 Cr in Previous FY But Opted Quarterly Filing

Group B States: Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand, Odisha, Jammu and Kashmir, Ladakh, Chandigarh, Delhi

B. Non Resident Tax Payers, ISD, TDS & TCS Taxpayers

Form No.

 

Compliance Particulars

Timeline

Due Date

GSTR-5 & 5A

Non-resident    ODIAR                         services provider file Monthly GST Return

20th of succeeding month

20.07.2022

C. GST Refund

Form No.

 

Compliance Particulars

Due Date

RFD -10

Refund of Tax to Certain Persons

18 Months after the end of quarter for which refund is to be claimed

   D. GSTR – 4 – Apr-June, 2022:

Compliance Particular

 

Due Date

GSTR-4 is annual return filed by a registered person opting for a composition scheme. The due date was extended from 30.06.2022 to 28.07.2022 by the 47th GST Council meeting.

 

28.07.2022

E. CMP – 08 – CMP-08 is a form that declares the composition dealer summary of his/her self- assessed taxable amount for a particular quarter. In addition to this, it also acts as challan to make payment of  taxes.

Compliance Particular

 

Due Date

Form GST CMP-08 is used to declare the details or summary of self-assessed tax payable by taxpayers who have opted for composition levy. Extended by 47th GST Council meeting.

 

31.07.2022

  • Major Update:

Attention: Attention: Taxpayers with AATO in excess of Rs 20 Crore are also required to generate e-invoice for their outward supplies w.e.f. 1st April, 2022.

Weekly Departmental Updates: Income Tax

1.  CBDT aims to add 12% more tax return filers this fiscal

 The CBDT also plans to expedite disposal of high-value income tax appeals under the faceless mechanism. The Union government is looking to widen the tax base by targeting addition of 12% more new return filers this fiscal against 8% in FY22, an official document showed.

According to the Central Action Plan (CAP) for FY23 circulated internally by the Central Board of Direct Taxes (CBDT), the department also plans to expedite disposal of high-value income tax appeals under the faceless mechanism.

The CBDT has asked field officers to use data mining, data analytics, inputs from market associations and trade bodies to identify non-filers, and directed its directorate of systems to provide data on non-filers and those who have stopped filing by 30 September.

The growth of new return filers peaked in the year after demonetization, but fell sharply a year before covid. New filers’ growth stood at 17.7% in FY17, 19.79% in FY18 and 17.58% in FY19, before it fell to 10.6% in FY20, 10.18% in FY21, and to 8% in FY22. However, direct tax collections have been robust over the last two years, growing 49.02% in FY22 to ₹14.09 trillion from ₹9.45 trillion in FY21.

A new filer is defined as a person, who is not included in the filer base at the start of the year, but has filed a return during a fiscal year.

Meanwhile, the government has implemented the non-filers monitoring system (NMS), which assimilates and analyses in-house information as well as transactional data received from third- parties to identify such persons/entities who have made high-value financial transactions with potential tax liabilities but have not filed their returns. To read more Click Here

2. ITR filing: Please don’t wait till July 31, Income Tax department tells taxpayers

The last day for filing income tax return (ITR) for the financial year 2021-22 (FY22) is approaching soon. The due date to file the annual ITR is July 31. A short extension might be considered by the Income Tax department, reports said. In the last couple of years, the ITR deadline has been consistently extended.

“Please don’t wait till the last date. File today,” the Income Tax department tweeted on Wednesday. Some of the types of ITR forms are ITR-2, ITR-3, ITR-4 and ITR-5. Individuals need to make sure they are filing the correct form applicable to them. Although income tax laws allow individuals to file ITR after the deadline passes, a penalty between Rs 1,000 and Rs 5,000 might be imposed on salaried individuals. To read more Click Here

3. These Individuals Must File Income Tax Return Mandatorily. Read Details

The Income Tax (I-T) Department has recently removed several exemptions from the list of people who are mandatorily required to file their income tax returns. The deadline to file ITR for the financial year 2021-22 (assessment year 2022-23) is July 31, 2022, and individuals should check whether they are required to file income tax returns.

Missing the deadline can lead to paying late charges or criminal action being taken on you by the I-T Department. If a resident individual’s income is higher than the exemption limit set for the year, then the person is asked to file tax return.

Additionally, the I-T department has specified that individuals whose total TDS/TCS (tax deducted at source/tax collected at source) in the financial year are higher than ₹ 25,000 and ₹ 50,000 for senior citizens, also need to file their ITRs.

If an individual’s gross income exceeds the exemption limit before claiming capital gains tax exemptions, individuals with sources of foreign income or holding foreign assets, individuals who have paid an electricity bill of more than ₹ 1 lakh in a single bill or in aggregate throughout the year, and individuals who have spent more than ₹ 2 lakh for foreign travel on himself or any other person. To read more Click Here

4.  Dolo-650 makers under Health Ministry scanner after I-T Dept sniffs out ‘unethical practices’

The CBDT said the department has seized “unaccounted” cash of Rs 1.20 crore and gold and diamond jewellery of Rs 1.40 crore. The CBDT is the administrative body for the I-T department.

Taking cognisance of the recent findings shared by the Income Tax Department post its search operations against Bengaluru-based Micro Labs, the Ministry of Health and Family Welfare and the Department of Pharmaceuticals has tasked the Ethics Committee under the National Medical Commission to probe into the matter.

This comes after the Central Board of Direct Taxes (CBDT) had accused the makers of the widely-known Dolo-650 medicine tablet of indulging in “unethical practices” and distributing

freebies of about Rs 1,000 crore to doctors and medical professionals in exchange for promoting products made by the pharmaceutical group.

Dolo-650, an analgesic (pain killer) and antipyretic (fever-reducing ) oral tablet, was being extensively prescribed by doctors and medical shop owners for coronavirus patients to reduce pain and fever, common symptoms experienced by those infected.

The company website showcased a news article, published in February, that said: “The company has sold 350 crore tablets (of Dolo-650) since the COVID-19 outbreak in 2020, and earned revenues of Rs 400 crore in a year.” The CMD of the company, Dilip Surana, was quoted in the story.

It added that the department also found instances of “violation” of provisions of tax deduction at source (TDS) under Section 194C of the I-T Act in respect of transactions under contracts forged with the third-party bulk drug manufacturers.

  • Important  Circulars and Notifications:
Sl.

 

Particulars of the Notification(s)

File No. /

Circular No.

Notification

Link(s)

1

The Income-tax (Twenty Second Amendment) Rules, 2022.

Notification No. 83/2022

Click Here

 

2

The Income-tax (21st Amendment) Rules, 2022

Notification No. 80/2022

Click Here

  • Weekly Departmental updates:  

      GST Updates

1. Availing ITC as per law and GSTR2B. Please refer News and Update section.

2.  Pay GST on pre-packed, labelled food items, hospital rooms above Rs 5K from Monday
Customers will have to pay 5 per cent GST on pre-packed, labelled food items like atta, paneer and curd, besides hospital rooms with rent above Rs 5,000 from Monday with the GST Council’s decision coming into force. In addition, hotel rooms with tariff of up to Rs 1,000/day, maps and charts, including atlases, will attract a 12 per cent Goods and Services Tax (GST),

while 18 per cent GST will be levied on tetra packs and fees charged by banks for the issue of cheques (loose or in book form).

Last month, the GST Council, chaired by Union finance minister Nirmala Sitharaman and comprising her state counterparts, had pruned the exemption list and imposed tax on a host of goods and services.

The Council, based on an interim report of the Group of Ministers (GoM) on rate rationalisation, had also removed duty inversion for goods where the taxes on inputs were higher than those on the output.

Tax rates on products such as printing, writing or drawing ink; knives with cutting blades, paper knives and pencil sharpeners; LED lamps; drawing and marking out instruments will be hiked to 18 per cent on Monday, from 12 per cent currently, to correct the inverted duty anomaly.

  • Besides, taxes will be cut on on ostomy appliances and on transport of goods and passengers by ropeways to 5 per cent from July 18, from 12 per cent.
  • Renting of truck, goods carriage where the cost of fuel is included will now attract a lower 12 per cent rate as against 18 per cent.
  • GST exemption on the transport of passengers by air to and from northeastern states and Bagdogra will be restricted to economy class
  • Services rendered by regulators such as RBI, IRDA and SEBI will be taxed at 18 per cent and so will be renting of a residential dwelling to business entities.
  • Bio-medical waste treatment facilities shall attract 12 per cent GST, while non-ICU hospital rooms exceeding Rs 5,000/day will be levied 5 per cent GST, without input tax credit, to the extent of the amount charged for the
  • Besides, individuals will only be able to claim GST exemption for training or coaching in recreational activities relating to arts or culture or

The government has now notified that all such clinical establishments including hospitals, nursing homes, and sanatorium would be liable to pay tax on the gross room rentals which is more than Rs 5,000 per day. (Read more at: Click Here)

3. IMA urges Finance Minister Nirmala Sitharaman to withdraw GST on healthcare

The Indian Medical Association on Saturday requested Union Finance Minister Nirmala Sitharaman to withdraw the imposition of Goods and Services Tax on healthcare services, saying the step will raise the cost of running hospitals and clinics in the country.

Referring to a recommendation by the 47th GST council which stated that “like CTEPs, common bio-medical waste treatment facilities for treatment or disposal of biomedical waste shall be taxed at 12 per cent so as to allow them ITC”, the Indian Medical Association (IMA) said these facilities were earlier in the GST exempted category and will be taxed post-July 18.

The doctors’ body also cited another recommendation which stated that “room rent, excluding ICU, exceeding Rs 5,000 per day per patient charged by the hospital will also be taxed at 5 per cent, without input tax credit (ITC)”. The IMA said, in its letter, that this facility was also GST

(Goods and Services Tax) exempted and will now come under the purview of the GST norms post July 18.

The Association further rued that already the healthcare system of the country is not on track owing to meagre government spending on health, adding that people are largely dependent upon private sector with high out-of-pocket expenditures. To read more Click Here

4.. CAIT to organise nationwide agitation for simplification of GST laws

The Confederation of All India Traders (CAIT) has said that it will launch a nationwide agitation from July 26 to demand the simplification of the GST laws. The agitation, which will kick off from Bhopal, aims to question the ‘dictatorial functioning’ of the GST council, said CAIT.

The traders’ body also highlighted the huge burden of unnecessary tax compliance on traders and how the complicate GST taxation norms are responsible for it.

The trader’s body iterated the need for a total review of the GST Act & laws to make the tax regime ‘simplified & rationalised’.

A demand for reviewing the GST Act’s norms was made earlier in June as well by the trader’s body. CAIT Secretary General Praveen Khandelwal also met Sitharaman in June and stressed the need for widening the GST tax base by simplifying the GST Act and rules. Khandelwal also suggested formation of a Joint GST Committee in every district of the country comprising senior GST tax officials and trade leaders of the respective districts, according to a avenue mail report. To read more Click Here

5. Holidays to become costlier from July 18 as all hotel rooms to be taxed under GST

Those looking to holiday on a budget must get ready to cough up more for their hotel rooms from July 18, 2022. This is because the Goods and Services Tax (GST) Council has announced that from July 18, even hotels that charge below Rs 1,000 a day will come under the GST net.

As per a press release issued by the GST council on June 29, 2022, “Hotel accommodation priced up to Rs 1000/day shall be taxed at 12%.” (However, the government is yet to issue a notification in this regard.) Up until now, GST exemption was available for hotel rooms up to Rs 1,000 per day.

Post-July 18, 2022, the GST that will be charged on the hotel room will be as follows:

Hotel room cost

 

GST rate

Up to Rs. 7,500/-

12%

Rs. 7.501/- and above

18%

Poonam Harjani, Leader, Indirect Tax Research and Advisory, Taxmann.com says, “So far, services by a hotel, inn, guest house, club or campsite for residential or lodging purposes, having value of supply of a unit of accommodation below or equal to Rs. 1000 per day or

equivalent has been exempt from GST. The GST Council has recommended to withdraw the said exemption and apply 12% GST rate thereon. With this rate amendment, effectively all hotels having declared tariff of Rs. 7500 or below will be liable to GST at the rate of 12 percent. That said, levy of GST on low-cost hotels will make the holidaying more expensive for common man.”

  • Important Notifications under

           Excise / Custom/ GST:

      GST UPDATES

Sl.

 

No.

Particulars of the Notification(s)

File No. / Circular No.

Notification Link(s)

1

Seeks to amend notification No. 10/2019- Central Tax

15/2022-Central Tax

Click Here

2

Seeks to amend notification No. 14/2019- Central Tax

16/2022-Central Tax

Click Here

3

Rescinds notification No. 45/2017- Central Tax (Rate)

11/2022-Central Tax (Rate)

Click Here

4

Seeks to amend notification No. 2/2022- Central Tax (Rate)

10/2022-Central Tax (Rate)

Click Here

5

Seeks to amend notification No. 5/2017- Central Tax (Rate)

09/2022-Central Tax (Rate)

Click Here

6

Seeks to amend notification No. 3/2017- Central Tax (Rate)

08/2022-Central Tax (Rate)

Click Here

7

Seeks to amend notification No. 2/2017- Central Tax (Rate)

07/2022-Central Tax (Rate)

Click Here

8

Seeks to amend notification No. 1/2017- Central Tax (Rate)

06/2022-Central Tax (Rate)

Click Here

9

Seeks to amend Notification No 13/2017- Central Tax (Rate) dated 28.06.2017

05/2022-Central Tax (Rate)

Click Here

                                                CUSTOM / EXCISE UPDATES

Links

 

Notification Particulars

Click Here

Seeks to amend notification No. 11/2017 so as to extend the concessional rate of ATF on certain RCS routes

 

Click Here

Seeks to amend Notification No. 03/2021-Central excise to exempt E12 and E15 blended fuel from Agriculture Infrastructure Development Cess (AIDC)

Click Here

Seeks to amend notification No. 19/2019-Customs for defence related imports.

Click Here

Seeks to amend notification No. 50/2017-Customs for DEC tablet and S. No. 404 Petrol operations.

 

Click Here

Seeks to amend the name of Country of Export from ‘Singapore’ to ‘Any country including Indonesia’ for the producer ‘PT. ENERGI SEJAHTERA MAS’ and Exporter ‘Sinarmas CEPSA Pte. Ltd.’ in Customs notification No. 28/2018- Customs (ADD) dated 25 th May, 2018 which imposed Anti-dumping duty on imports of ‘Saturated Fatty Alcohols’ from Indonesia, Malaysia, Thailand and Saudi Arabia.

                                      Important Case-laws

                                      Income Tax

                 Case Details: Rajesh Bajaj v. DCIT

 Citation: [2021] 123 taxmann.com 213 (Delhi – Trib.)

 AO can’t import the definition of ‘Relative’ from Section 56 to invoke Section 40A (2)

 The Allahabad ITAT held that the definition of the term ‘relative’ provided under section 2(41) does not cover the sister-in-law of the assessee. However, the sister-in-law of the assessee is covered within the definition of the term ‘relative’ as provided under Section 56(2). Since the said definition is only for the relevant clause provided under Section 56(2), therefore, the same couldn’t be applied in respect of provisions of Section 40A(2) when a general definition of the term ‘relative’ is provided under Section 2(41).

Hence, the provisions of Section 40A(2) couldn’t be invoked in respect of a transaction of payment of rent to persons who are not falling in the definition in term of ‘relative’ provided under Section 2(41).

2. Case Details: Aditya Balkrishna Shroff v. ITO

 Citation: [2021] 127 taxmann.com 343 (Mumbai – Trib.)

 Gain received on personal loan due to forex fluctuation is a capital receipt not liable to tax: ITAT

The Mumbai ITAT held that even before deciding whether the gain was of income nature, AO had proceeded to put the cart before the horse by deciding the head under which the income is to be taxed. He mixed up the concept of income with the concept of gains. In the case of Shaw Wallace & Co Ltd v. DCIT [2001] 117 Taxman 192 (Calcutta), the ITAT held that a capital receipt, in principle, is outside the scope of income chargeable to tax. A receipt cannot be taxed as income unless it is in the nature of a revenue receipt or is specifically brought within the ambit of income by way of specific provisions of the Income-tax Act.

AO had accepted that the transaction was in the capital field and proceeded to hold that income arising out of the loan transaction was required to be treated as interest or income from other sources. If the transaction is in the capital field, the question of its taxability does not arise unless there is a specific provision of bringing such a receipt to tax. In any case, where the loan was foreign currency-denominated and the amount advanced as loan, as also received back as repayment, was precisely the same, there was no question of interest component at all.

The benefit or gain received by the assessee was on account of foreign exchange fluctuation. Since the foreign exchange fluctuation was with respect to a transaction in the capital field, the foreign exchange fluctuation receipt itself turned out to be a capital receipt.

                                                                                                           Important Case-laws

                                                                                                                 GST Law

  1. EY tax ruling may be a ray of hope for Chinese

    companies

The Income Tax Appellate Tribunal (ITAT) recently allowed a plea filed by British company Ernst & Young Global Services, challenging the income tax department’s demand that it pay

₹6.6 crore as tax. An assistant commissioner of income tax, international taxation, raised the tax demand after assessing the company’s foreign remittances for four years, which the officer termed as royalty paid to the parent company. The department taxed Ernst & Young Global under three heads: software charges, global technology charges and global wide area network (GWAN) connectivity charges.

The company provides centralised services to the member firms of EY, the global professional services group. It challenged the demand, claiming that the payments received by it from Indian

member firms were mere reimbursements of costs and not taxable under the Income Tax Act and the Double Taxation Avoidance Agreement between India and the UK.

An Authority of Advance Ruling (AAR) upheld the tax assessment, but the Delhi High Court ruled in December last year that payments received for providing computer software to the member firms did not amount to royalty and were not liable to be taxed.

“This judgement will have far-reaching consequences and may benefit similarly placed foreign companies embroiled in identical tax disputes,” said Chetan Mittal, a senior advocate and former assistant solicitor general.

Adding a word of caution, advocate Aditya Dewan, a corporate litigator who is well-versed with taxation laws, told ET: “While representatives of Chinese companies may seek to benefit from this ruling, it remains to be seen whether they would succeed or not. Because among other issues, the Indo-China agreement of Double Taxation Avoidance will come into play in case of Chinese entities.”

The company contended that it was established as a non-profit central service provider to enable EY member firms to share the costs of centralised services. It enters into agreements with each member firm and recovers various costs incurred by it from the member firms on an actual usage basis. Reference: Click Here

2. 18% GST on sale of ad space on e-commerce sites

In a move that could impact the entire e-commerce space, Karnataka’s Authority for Advance Ruling (AAR) on July 1 came up with a ruling on an application filed by e-commerce player Myntra, wherein Myntra had sought taxation clarity from the authority on what should be the tax rate if it sells space to an advertising agency.

Myntra had approached Karnataka AAR in December 2021, seeking this clarity, it was then in Feb 2022, when AAR heard the matter, and on July 1, the authority observed that “Sale of Advertising Space (except on commission) is taxable to 9 percent CGST and 9 percent SGST.”

The e-commerce platform wanted to know from the Karnataka AAR “what should be the tax treatment when the space is provided to the advertisers for the advertisement.”

The AAR, after hearing the matter, observed that “Myntra has no control over the manner in which the advertiser uses the space, nor is there any privity of contract between Myntra and the ultimate content to which advertisement relates.”

Such a service is classified as “Other professional, technical and business services” for GST

purposes and attracts 18 percent GST.

However, AAR did not rule on the ad agency being located abroad as it doesn’t fall under its

jurisdiction.

According to experts, this is a ruling which will be relevant to all advertisements on e- commerce portal websites, mobile applications,s or any other platform of the e-commerce players. To read more: Click Here

  • International Taxation Corner (ITC)
  • 1. The Global Tax Revolution for Tech Giants Is Delayed to 2024

A global taxation deal heralded as a “revolution” for the profits of multinational tech firms has

run into a thicket of technical difficulties that will delay implementation to 2024 at the earliest.

Work at the Organization for Economic Cooperation and Development on a legal instrument to change tax treaties the world over has proved tougher than foreseen when negotiators initially set next year as a target for the new system to come into force.

“These are complex and very technical negotiations in relation to some new concepts that fundamentally reform international tax arrangements,” OECD Secretary-General Mathias Cormann said Monday. “We will keep working as quickly as possible to get this work finalized, but we will also take as much time as necessary to get the rules right.”

A failure to implement new rules that would give countries outside the US more rights to tax firms like Amazon.com Inc. and Facebook’s parent Meta Platforms Inc. ultimately risks reigniting a transatlantic trade dispute over digital levies that began during Donald Trump’s presidency.

European nations and the US had agreed to suspend their tit-for-tat measures so long as OECD’s global accord is implemented by Dec. 31 2023. Canada has also passed legislation that would put in force a national digital tax, retroactive to Jan. 1, if the new global rules aren’t in place by the end of next year. Read more at: Click Here

2. SKorea to push to exempt taxes on foreigners’ investment in gov’t bonds

Seoul, July 17 (IANS) South Korea will push to exempt taxes on interest income and capital gains from foreigners’ investment in government bonds and monetary stabilisation bonds in a bid to help stabilise the debt market, the finance minister has said.

Finance Minister Choo Kyung-ho made the remarks on the details of the government’s planned tax code revision at a meeting with reporters Saturday (local time) in Bali on the sidelines of a Group of 20 (G-20) gathering of finance chiefs, Yonhap news agency reported.

“The government plans to seek the exemption of taxes on interest income and capital gains for non-residents and foreign companies’ investment in Treasuries and monetary stabilization bonds to help broaden the demand base for government bonds and advance the debt market,” Choo said.

The move is expected to stabilize the country’s bond and foreign exchange market as an increase in foreign bond investment will likely help lower bond yields and curb the won’s weakness, according to the finance ministry. To read more Click Here

According to a South African tax consultancy firm, Tax Consulting SA, recent revelations by the central bank deputy governor that his institution intends to regulate cryptocurrency in 12 to

18 months, means cryptos “will soon be regulated under the Financial Advisory and Intermediary Services (FAIS) Act.” This, therefore, means all organizations or individuals deemed to be providing intermediary or advisory services will be required to register as financial services providers with relevant bodies.

In a report shared with Bitcoin.com News, Tax Consulting SA predicts that as the next step, SARB will introduce know your customer (KYC) procedures and exchange control regulations. The consulting firm is, however, quick to point out that the South African Reserve Bank (SARB) “will not interfere in the investment decisions made by crypto investors.”

Once the regulatory framework is in place, non-compliance will be easier to spot and at that point, South Africa’s “wild west” crypto industry will be a thing of the past, the report concludes.

Tax Consulting SA also warns that during this period prior to the introduction of the regulatory regime, “crypto investors [need] to ensure that they are up to date with their compliance obligations.”

Another concern will be in relation to tax compliance, for example, as tax evasion will be much more easily detectable with transactions falling under the purview of the SARB’s Financial Intelligence Centre (FIC). To read more Click Here

      Knowledge Bucket for NRI’s              

  • An NRE account is a rupee dominated account that can be opened by a person of Indian origin or a person who has become a non-resident Indian (NRI) under FEMA (Foreign Exchange Management Act) guideline.

The account facilitates deposit of foreign currency earnings. As the NRE account has high liquidity and allows for full repatriation of funds, it is highly advantageous for an NRI to send money from their country of residence when required.

  • The Reserve Bank of India (RBI) recently relaxed the norms governing non-resident external (NRE) deposits to arrest the outflows from these accounts and bring more
  • An NRE account cannot be opened by a power of attorney holder and has to be personally opened by the
  • An individual can have more than one NRE accounts in India. Such account can be jointly opened with another NRI but not with any other
  • The RBI does not allow a person of Pakistani or Bangladeshi citizenship to open an NRE account in

   DO YOU KNOW ??                                                      

  1. Kotak Mahindra Bank has completed technical integration with the new e-filing portal of the Income Tax department and has become the first private bank to fully integrate with the

Its customers can now pay their direct taxes through the e-pay tax tab on the portal using Kotak net banking or by visiting a branch. This will make the tax payment process simple, instant, and convenient for customers, said the bank.

  1. Capital gain tax on sale of residential properties may be saved in two ways – either by investing in Capital Gain Bonds or by investing the amount in buying up to two residential
  2. Any interest on contributions made towards EPF of an employee only remains tax-free for

contributions of up to ₹ 2.5 lakh a year.

  1. Employer’s contribution to Provident Fund (PF), NPS and superannuation aggregating to

a total sum of ₹ 7.5 lakh a year is exempt from taxes.

  1. The contribution threshold is increased to ₹ 5 lakh if an employer is not contributing

towards the EPF of an employee

 Disclaimer:                                                                            

Every effort has been made to avoid errors or omissions in this material. In spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition. In no event the author shall be liable for any direct, indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information. *(We consider various sources including ET, BS, HT, Taxmann etc.)

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