From July 1, the new rule of deduction of tax linked to TDS is coming into force. Under this, a new section 194R was added in the Income Tax Act in the budget, under which if any profit of Rs 20,000 or more is given in a year, then 10 percent TDS will have to be paid on it. The new provision will come into effect from July 1.
On behalf of the Finance Ministry, it has been said that the confusion regarding the new tax deduction at source (TDS) provisions in respect of perquisites or additional facilities available in any business or profession will be cleared. Kamlesh C Varshney, Joint Secretary in the Ministry of Finance said that such facilities are additional benefits and will be taxed.
On the other hand, if you have not filed income tax return under the financial year 2020-21, then you will come in the list of non income tax filer. This means that you may have to pay more tax for the financial year 2022-23. The Central Board of Direct Taxes (CBDT) has issued a circular for non-filers, relaxing certain guidelines, which come under higher tax deduction for the financial year 2022-23.
As per the circular issued, if someone had not filed ITR for the previous financial year and his total TDS and tax in that year was more than Rs 50,000, then it is subject to higher TDS. It has also been said that banks will have to check high TDS.
According to the information, no one’s name is there in the list of high tax deducted persons to reduce the burden on the tax deductor and collector during the financial year 2023. According to this, if a person concerned files a valid return of income (filed and verified) for the assessment year 2021-22 during FY23, his name will be removed from the list of tax deducted persons. This will be done on the date of filing of valid return of income.
Tax exemption rule in case of business
This provision of section 206AB will not be subject to tax deduction in transfer of Virtual Digital Asset (VDA) to a person under section 1948 of the Act. Whereas in case of business, tax deduction is allowed on VDA transfer of more than 50 lakhs or 1 crore.