Tag: TAX RETURN

Tax Refunds: Big Update for IRS Tax Refund Delays

Where’s My Refund? Impact of IRS Layoffs on Tax Return Processing Time and How to Check Status

If you’re hoping to find some extra cash or pay off debts, a tax refund can be quite beneficial. The Internal Revenue Service started accepting tax returns from individuals on January 27.

According to IRS statistics, nearly 140 million Americans are projected to file their taxes. But when can you expect that check or direct deposit? Are there potential delays?

Here’s what you need to know regarding tax deadlines, how to track your refund status, and when to anticipate your return.

How to Check the Status of Your Refund

On the IRS.gov website, taxpayers who have submitted their returns can find their refund status using the “Where’s My Refund?” tool. To access the status, you’ll need to input the following details:

  • Your Social Security or Individual Taxpayer Identification Number (ITIN)
  • Your filing status
  • The exact amount of your refund as reported on your tax return

Once you have provided this information, you will see one of the following status messages:

Will IRS Layoffs Delay My Refund?

As reported by USA TODAY, up to 15,000 newly hired IRS employees, mainly in entry-level positions such as taxpayer assistance, phone support, and junior auditing roles, could face layoffs in the coming week. These employees are still on probation and do not have civil service protections.

With around 90,000 full-time staff, the IRS could see a potential reduction of approximately 17 percent of its workforce due to these layoffs.

At this point, it remains uncertain how these layoffs might affect the processing time for tax returns this year.

How Long Until My Refund is Deposited?

The timeframe for receiving your refund largely depends on your filing method.

Filing electronically usually results in a faster processing time compared to filing a paper return and waiting for a check. According to the IRS, most refunds are processed within three weeks.

The IRS advises taxpayers against relying on receiving their refund by a specific date, especially when planning significant purchases or bills, as some returns may require additional review, which could extend processing times.

What Causes Refund Delays?

There are several reasons a tax return may be delayed. Here are the most common factors identified by the IRS:

  • Errors or incomplete information on the return, or issues related to identity theft or fraud.
  • Corrections needed for amounts related to the child tax credit or recovery rebate credit.
  • A claim for earned income tax credit or additional child tax credit, or the inclusion of Form 8379, Injured Spouse Allocation PDF.
  • The duration it takes for your bank or credit union to process the refund to your account.

What is the Deadline for Filing Taxes?

Federal income tax returns for 2024 must be submitted by April 15, 2025. Americans living abroad are granted an extended deadline of June 16, 2025.

The IRS specifies that the timestamp in your local time zone when you file your electronic return determines its timeliness. For paper submissions, the IRS considers them timely if they are properly addressed, have adequate postage, and are mailed and postmarked by the due date. For electronic filers, the deadline is 11:59 p.m. local time.

Income Tax Calculator Excel to Compare both Regimes and help you Decide the Best Option for FY 2025-26

Breaking News: The Union Budget 2025 has revamped personal income tax! 🚨

  • New slabs, higher exemptions, and lower tax rates—but should YOU switch to the new tax regime?

👉 This article uses real calculations from our tax calculator to compare both regimes and help you decide the best option for FY 2025-26.

📢 What’s Changed in the Budget 2025?

The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, has introduced game-changing reforms for salaried individuals:
✅ Income up to ₹12 lakh is now tax-free! (Earlier: ₹7 lakh)
✅ New tax slabs with reduced rates!
✅ Standard deduction increased to ₹75,000 under the new regime
✅ Employer NPS contributions remain tax-free, while EPF benefits are reduced (Introduced in earlier budget – no changes made)

With these changes, many taxpayers are wondering: Should I stay in the old tax regime or shift to the new one? We analyzed real salary data using our Excel Tax Calculator to answer this question.

📊 CTC ₹24 Lakhs: Which Tax Regime Saves You More?

Let’s compare tax liability for a salaried individual earning ₹24 lakh CTC, assuming typical deductions.

Total Deductions Under the Old Regime

Deduction ComponentAmount (₹)
Standard Deduction₹50,000
HRA Exemption₹3,36,000
LTA (Leave Travel Allowance)₹1,00,000
Section 80C (EPF, LIC, ELSS, etc.)₹1,50,000
NPS Deduction (80CCD(1B))₹50,000
Health Insurance (80D)₹50,000
Total Deductions Claimed₹7,36,000

This brings down the taxable income under the old regime to ₹16,90,000.

💰 Tax Calculation Under Both Regimes

CTC (₹ Lakh)Tax Under Old Regime (₹)Tax Under New Regime (₹)
24₹3,31,968₹2,99,000

🚀 The New Regime Wins! – Download the excel calculator to see in details

✅ Tax under the new regime is ₹32,968 lower than the old regime.
✅ Even with high deductions (₹7.36 lakh), the new regime results in lower tax.
✅ If you don’t use 80C and 80D deductions fully, switching to the new regime will save you even more!

🔍 Why EPF May No Longer Be the Best Option

Employee contributions to EPF no longer qualify for tax deduction under the new regime. However employees preferred to contribute to PF by availing the benefit under old regime. After significant change in slab rates under new regime, EPF became irrelevant for the purpose of tax saving.

ComponentOld RegimeNew Regime
Employer Contribution to EPF✅ Exempt✅ Exempt
Employee Contribution to EPF✅ Deductible under 80C❌ Not Deductible

Instead, shifting to NPS (National Pension System) is now more tax-efficient, as employer contributions remain completely tax-free and there is no mandate for employee contribution.

💡 Should You Switch to the New Tax Regime?

✔ If your deductions (HRA, 80C, 80D) exceed ₹7 lakh, the old regime might still be slightly better.
✔ If you don’t want to lock funds into EPF and tax-saving investments, the new regime offers lower tax rates and more take-home salary.

🛠️ Use Our Excel Tax Calculator to Decide!

Not sure which regime to choose? Use our Excel Tax Calculator, which:
✅ Lets you input your salary details
✅ Automatically calculates tax under both old and new regimes
✅ Tells you which option saves you the most money

📥 [Download Our Tax Calculator Now] and instantly see which tax regime is best for YOU!

2025 TAX CalculatorDownload

🔚 Final Takeaways

  • Tax payers earning less than 12 lakhs are not required to pay tax.
  • Taxpayers earning more than ₹12 lakh stand to benefit the from the change in slabs in new regime.
  • For high deductions (₹7L+), the old regime still holds value.
  • Shifting to NPS is now a smarter tax move than EPF!
  • Use our tax calculator to make an informed decision!

🔔 Share this guide to help them decide their best tax strategy for FY 2025-26! 🚀

Record 7.28 crore ITRs filed for AY 2024-25 till 31st July, 2024

The taxpayers and tax professionals made their compliances in time, leading to a surge in filing of Income-tax Returns (ITRs), which resulted in a new record of ITRs filed till 31st July 2024. The total number of ITRs for AY 2024-25 filed till 31st July, 2024 is more than 7.28 crore, which is 7.5% more than the total ITRs for AY 2023-24 (6.77 crore) filed till 31st July, 2023.

  An increasing number of taxpayers have opted for the New Tax Regime this year. Out of the total ITRs of 7.28 crore filed for AY 2024-25, 5.27 crore have been filed in the New Tax Regime compared to 2.01 crore ITRs filed in the Old Tax Regime. Thus, about 72% of taxpayers have opted for the New Tax Regime, while 28% continue to be in the Old Tax Regime.

The filing of ITRs peaked on 31st July, 2024 (due date for salaried taxpayers and other non-tax audit cases) with over 69.92 lakh ITRs being filed on a single day i.e. on 31st July, 2024. The e-filing portal also observed its highest per hour rate of 5.07 lakh of ITR filing between 07:00 pm to 08:00 pm on 31.07.2024. The highest per second rate of ITR filing was 917 (17.07.2024, 08:13:54 am) and highest per minute rate of ITR filing was 9,367 (31.07.2024, 08:08 pm).

The Department also received 58.57 lakh ITRs till 31.07.2024 from first time filers, a fair indication of widening of tax base.

 In a historic first, ITRs (ITR-1, ITR-2, ITR-4, ITR-6) were deployed on the e-filing portal on the first day of the Financial Year ie on 01.04.2024.  The ITR-3 and ITR-5 were also released earlier in comparison with the preceding financial years. A lot of   emphasis was provided to educate taxpayers about Old and New tax regimes. FAQs and educational Videos on the same were designed and uploaded on the e-filing portal. 

Focussed outreach campaigns were carried out on Social Media to encourage the taxpayers to file their ITRs early. Along with this, unique creative campaigns were also carried out on different platforms. Informational Videos in 12 Vernacular languages, apart from English and Hindi, were displayed on digital platforms.  Outdoor campaigns were also carried out. Such concerted efforts led to fruitful results with increased number of filings. The following data of ITR filing over the last few years corroborates the same:

AYDue dateNo of Returns filed
2020-2110/01/20215,78,45,678
2021-2231/12/20215,77,39,682
2022-2331/07/20225,82,88,692
2023-2431/07/20236,77,42,303
2024-2531/07/20247,28,80,318

Out of the 7.28 crore ITRs filed for A.Y. 2024-25, 45.77% of ITRs are ITR-1 (3.34 crore), 14.93% are ITR-2 (1.09 crore), 12.50% are ITR-3 (91.10 lakh), 25.77% are ITR-4 (1.88 crore) and 1.03% are ITR-5 to ITR-7 (7.48 lakh).  Over 43.82% of these ITRs have been filed using the online ITR utility available on the e-filing portal and the balance have been filed using offline ITR utilities.

During the peak filing period, the e-filing portal successfully handled huge traffic, providing a seamless experience to taxpayers for filing of ITRs. On 31st July, 2024 alone, successful logins stood at 3.2 crore. 

The process of e-verification is important to commence the processing of ITRs and to issue refunds, if any.  It is encouraging to note that over 6.21 crore ITRs have been e-verified, out of which more than 5.81 crore are through Aadhaar based OTP (93.56%).  Of the e-verified ITRs, more than 2.69 crore ITRs for the A.Y. 2024-2025 have been processed (43.34%) till 31st July, 2024.  Over 91.94 lakh challans have been received through TIN 2.0 payment system in the month of July, 2024 (for AY 2024-25), while total number of challans filed through TIN 2.0 since 1st April, 2024 stands at 1.64 crore (for AY 2024-25).

The e-filing Helpdesk team has handled approximately 10.64 lakh queries from taxpayers during the year upto 31.07.2024, supporting the taxpayers proactively during the peak filing period. Support from the helpdesk was provided to taxpayers through inbound and outbound calls, live chats, WebEx and co-browsing sessions.

Helpdesk team also supported resolution of queries received on the X(Twitter) handle of the Department through Online Response Management (ORM), by proactively reaching out to the taxpayers/ stakeholders and assisting them for different issues on a near real-time basis.  The team handled over 1.07 lakh e-mails between the period 1st April to 31st July, 2024 and successfully resolved 99.97% queries.

The Department expresses its gratitude to tax professionals and taxpayers for their support in compliances in filing of ITRs and Forms. Taxpayers are also requested to verify their unverified ITRs if any, within 30 days of filing the ITR.

The Department also urges taxpayers, who for any reason, missed filing their ITR within the due date, to complete their filing expeditiously.

No penalty for missing ITR filing deadline of July 31, 2024 for these people

The Consequences of Filing a Belated Income Tax Return (ITR)

Missing the deadline for filing your Income Tax Return (ITR) can have serious implications beyond just a financial penalty. This article will explore the impact of late ITR filing and the penalties incurred in such cases.

Late Filing Penalties and Interest Charges

If you miss the deadline to file your ITR, which for individuals not subject to income tax audit is July 31, 2024, you may experience various consequences. Firstly, you may lose out on the interest component of your tax refund and the ability to carry forward any losses. However, individuals can still file a belated income tax return by paying a penalty, with the deadline for the financial year 2023-24 being December 31, 2024.

Chartered accountant Manoj Dembla, with over 30 years of experience, highlights that depending on your level of income, filing a late ITR may result in penalties and interest charges. Ankit Jain, a partner at Ved Jain and Associates, explains that the late fee under section 234F amounts to Rs 5,000 if the total income is above Rs 5 lakh, and Rs 1,000 if the total income is below Rs 5 lakh. This fee is applicable to all individuals who are required to file their ITRs.

Interest Charges and Refund Implications

Jain further elucidates that under Section 234A, interest at the rate of 1% per month is charged on the outstanding tax amount from the due date (July 31) till the date of filing the ITR. Filing a belated ITR may result in a reduction of interest on the tax refund under Section 244A, potentially leading to a lower interest amount.

In certain cases, no penalty is charged even if the filing is done after July 31, 2024. Taxpayers whose ITR filing deadline is October 31, 2024, those with income below the basic exemption limit, and individuals who are not required by law to file an ITR but do so voluntarily, are exempt from paying any penalty for filing a belated ITR.

Mandatory ITR Filing and Exemptions

According to Parul Aggarwal, founder of Parul Aggarwal and Associates, certain classes of taxpayers are mandatorily required to file their ITR, thus attracting the late filing penalty even if their income does not exceed the tax exemption limit. Classes include individuals with certain levels of savings bank deposit, annual sales turnover, professional income, electricity bill payment, TCS/TDS, foreign assets, foreign travel expenses, and more.

It is important to note that individuals who file their ITR voluntarily and have income below the basic exemption limit are not subject to the late filing penalty.

Choice of Tax Regime

Individuals filing ITR 1 or ITR 2 have the option to choose the old tax regime if they file the ITR before the deadline. This choice, as highlighted by CA Deepak Chopra, must be exercised in the ITR itself without the requirement of a separate form for non-business taxpayers.

Conclusion

In conclusion, the implications of filing a belated ITR are wide-ranging, including financial penalties, interest charges, and the loss of certain benefits. It is crucial for individuals to adhere to the prescribed deadlines and understand the consequences of late filing to avoid any avoidable financial burdens.

Income Tax Refund Processing Time: What You Need to Know

Understanding the Deadline and Refund Process for Income Tax Returns

As the deadline for filing income tax returns for the financial year 2023-24 or assessment year 2024-25 approaches, the process of return filing and refund disbursement gains momentum. With over 12 crore taxpayers registered on the Income Tax Department portal, and more than 1.42 crore returns filed and 1.33 crore returns verified, the current season reflects significant activity.

Refund Timeline

Taxpayers eagerly awaiting their refunds should note that the processing timeline typically ranges from 15 to 45 days. It is important to promptly verify filed returns, either through the convenient online e-verify option or through offline methods, to expedite the processing duration.

Factors Affecting Processing Time

The meticulous scrutiny of returns by the Income Tax Department ensures that the information provided regarding tax deductions and payments is accurate. If the tax paid exceeds the taxpayer’s liability, a refund is claimed through the return, leading to careful assessment by the department. Moreover, the accuracy of the information provided in Form-16 significantly impacts the processing time, with updated details expediting the process.

Anticipating the Refund

Once the return is processed, the refund amount is disbursed directly to the taxpayer’s bank account, bringing the income tax return filing process to a comprehensive conclusion.

As the income tax return filing and refund disbursement cycle unfolds, it is essential for taxpayers to stay informed about the processes and timelines to ensure a smooth experience.

Filing a Revised Income Tax Return: A Step-by-Step Guide

Filing of revised ITR 2024

Under Section 139(5) of the Income-tax Act of 1961, any assessee who has filed an ITR can revise it in order to furnish the tax department with accurate information. Even individuals who file a belated ITR, or ITR filed after the deadline, are eligible to file a revised return. Previously, only taxpayers who filed ITR before the deadline could alter their returns.

Step-by-step guide to help you track your refund status:

  1. Step 1: Go to the Income Tax Department’s e-filing website and log in to your account.
  2. Step 2: In Part A of General Information, select Revised Return under Section 139(5) mentioned in the drop-down section
  3. Step 3: Provide original return details
  4. Step 4: Choose the appropriate ITR form
  5. Step 5: In the revised return form, make the necessary corrections or updates.
  6. Step 6: If necessary, submit upload or submit them along with the revised return.
  7. Step 7: After verifying the details, submit the revised return.

Source: Various news

 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. 

Union Budget 2024-25: Anticipated Income Tax Reforms and Rates

The Economic Survey 2023-24 was recently unveiled on the inaugural day of the monsoon session of Parliament, setting the stage for the imminent presentation of the seventh Union Budget 2024-25 by Finance Minister Nirmala Sitharaman. Anticipation looms over potential announcements concerning income tax, including possible adjustments to exemption and standard deduction limits.

Current Taxation Structures

In the Budget 2023, Finance Minister Nirmala Sitharaman introduced modifications to the income tax landscape. The income tax exemption limit was elevated by Rs 50,000 to reach Rs 3 lakh, while the rebate under Section 87A of the Income Tax Act, 1961, was amplified from Rs 5 lakh to Rs 7 lakh. Notably, individuals earning up to Rs 7 lakh were exempted from tax liabilities under the new regime.

Income Tax Rates for FY 2023-24 (AY 2024-25):

Income Tax Slab (in Rs)Old Tax RegimeNew Tax Regime
0-2,50,0000%0%
2,50,001-3,00,0005%0%
3,00,001-5,00,0005%5%
5,00,001-6,00,00020%5%
6,00,001-9,00,00020%10%
9,00,001-10,00,00020%15%
10,00,001-12,00,00030%15%
12,00,000-15,00,00030%20%
15,00,0001 & Above30%30%

Note: For senior citizens (above 60 years), income tax under the old regime is exempt up to Rs 3,00,000, while for super senior citizens (above 80 years), income up to Rs 5,00,000 is exempt. Furthermore, a 4% health and education cess is levied on income tax.

Taxpayers have the prerogative to opt for either the old tax regime or the new tax regime, with the default scheme being the new tax regime.

Under the new tax regime, resident individuals with a net income not exceeding Rs 7 lakh are eligible for a rebate under section 87A, amounting to 100% of income tax or Rs 25,000, whichever is lower. Conversely, under the old tax regime, resident individuals with a net income up to Rs 5 lakh can avail a rebate under section 87A, capped at 100% of income tax or Rs 12,500, whichever is lower.

Anticipated Reforms in Union Budget 2024-25

Vivek Jalan, partner at Tax Connect Advisory Services LLP, predicts a shift towards a ‘Single Hybrid Tax Regime’ following the widespread adoption of the new tax regime by new taxpayers. It is anticipated that the exemption slab in the new regime may be extended from the current Rs 3 lakh to at least Rs 4 lakh.

Moreover, established taxpayers with an income surpassing Rs. 15 lakhs are expected to persist in the old regime. To incentivize their transition to the New Regime, a new tax slab within the new regime, such as Rs 15 lakh — Rs 18 lakh with a tax rate of 25%, may be introduced.

Furthermore, rationalization of the slabs in the new tax regime for individuals, HUFs, etc., is envisaged to broaden the tax base and facilitate the government’s progression towards a more exemption-free regime. Although this may entail a sacrifice in exchequer’s revenue, it is poised to promote the organized sector, diminish the unorganized sector, stimulate consumption, bolster GDP growth, and foster employment generation to meet escalating demands. Additionally, an augmentation of the standard deduction for salaried taxpayers is anticipated, fostering increased cash flow and advocating economic growth.

Stay updated with our comprehensive coverage of Union Budget 2024 for the latest updates pertaining to new income tax slab rates for AY 2024-25.

This synthesized information aims to provide a comprehensive understanding of the Union Budget 2024-25 and the potential adjustments in income tax regulations, ensuring individuals are well-prepared for the forthcoming fiscal year.

Combatting Fake News: Income Tax Scam Warning & Filing Challenges

Beware of Fake News: Income Tax Department Issues Warning

The Income Tax department has issued a stern warning about the circulation of false information regarding the extension of the date for e-filing of Income Tax Returns (ITRs). The warning comes in response to a spreading news clip from a popular newspaper in Gujarat, claiming that the last date for e-filing of ITR has been extended to August 31, 2024. The department has made it clear that this information is entirely fabricated, stressing that the authentic deadline for filing ITR for FY2023-24 remains July 31, 2024.

The department’s stance was emphasized through a social media post, where it urged taxpayers to rely solely on updates from the official website/portal of IncomeTaxIndia, discrediting any misinformation obtained from dubious sources.

Concerns have also been raised about a new scam involving fraudulent attempts to extract tax refunds from unsuspecting individuals. Scammers have been utilizing the pretense of tax refunds through SMS and email communications to illicitly access victims’ bank accounts, prompting a heightened sense of vigilance among taxpayers.

Adding to the challenges, numerous technical glitches on the e-filing ITR portal have been reported by both taxpayers and Chartered Accountants. Stakeholders have faced intermittent difficulties while attempting to log into the portal, often attributed to system overloading or maintenance activities. Moreover, discrepancies in pre-filled data, issues with form access, and delays in responses submission have further compounded the situation, causing considerable distress and anxiety among taxpayers and other stakeholders.

Several professional associations, including ICAI, Karnataka State Chartered Accountants Association (KSCAA), and the All Gujarat Federation of Tax Consultants and Income Tax Bar Association, have raised concerns over the portal’s functionality and have appealed for an extension of the filing deadline to ease the pressure on taxpayers. The All Gujarat Federation of Tax Consultants and Income Tax Bar Association has formally requested the finance minister, Nirmala Sitharaman, to consider extending the deadline for filing Income Tax Returns for AY 2024-25 from July 31, 2024, to August 31, 2024.

The challenges faced by taxpayers, such as difficulty in resetting passwords, generating challans, and filing returns, have significantly impeded the filing process. Error messages during submission, multiple failed OTP validations, and the inability to download ITR receipts have further exacerbated the situation, amplifying the urgency for a resolution to these technical issues.

The current scenario underscores the critical need for immediate action to rectify technical shortcomings and secure a smooth and efficient process for taxpayers and professionals alike.

Image

The Income Tax department’s vigilance and the concerns expressed by professional bodies serve as a stark reminder of the importance of accessing reliable information and staying alert against potential fraudulent activities. With the filing deadline fast approaching, a swift and effective resolution to the technical challenges is imperative to ensure a seamless and stress-free filing experience for all stakeholders.

Income tax return: List of changes in income tax forms for 2022-23

ITR Form 1 can be filed by an individual having income up to ₹50 lakh and who receives income from salary, one house property/other sources (interest etc).

ITR-2 is filed by people having income above ₹50 lakh, and having income from residential property

ITR-3 by people having income as profits from business/ profession,

ITR Form 4 are simpler forms that cater to a large number of small and medium taxpayers.

ITR-5 is filed by LLPs and businesses

ITR- 6 is filed by businesses respectively

ITR-6 is filed by LLPs and businesses.

Changes in the new ITR forms?

1) Taxpayers will be relieved that there are no changes in ITR-1.

2) In the remaining forms a new schedule for reporting Income from Virtual Digital Assets has been included under the head Capital Gains.

3) This new schedule requires taxpayers to report the date of acquisition, date of transfer as well as cost of acquisition and the proceeds received on sale of VDAs. Income from VDA must be reported quarterly.

“Tax provisions for taxation of VDAs was introduced from FY 2022-23 hence the addition of new schedule is in line with the expectation,” Deloitte India Partner Saraswathi Kasturirangan said

4) Besides the above, the forms have been amended to include additional questions relating to selection of the new tax regime.

5) The form requires the taxpayer to report whether the filer has opted for the new regime in the last assessment year, and also select the assessment year in which it was opted.

6) Additionally, another question has been inserted asking whether taxpayers have opted out of New Regime in any of the previous year and is also expecting the taxpayer to mention the 10IE details for both selections.

Your Income Tax Refund Is Delayed?

Government has issued income tax refunds of Rs 2.40 lakh crore between April 1, 2022, and January 10, 2023, which is 58.74 per cent more than what was done during the same period the year before, according to a statement by the Press Information Bureau (PIB) on January 11, 2023.

But what would you do if your income tax refund is delayed? Sometimes, people file their income tax on time, yet their refund is delayed. According to tax experts, this could be due to several reasons: the income tax department could be handling a large number of returns, hence the delay, or you might not have linked your nominated bank with Aadhar, or you have not nominated the right bank where the money could be transferred, besides other reasons. It is important to know the reasons and to take action accordingly.

“The refund might not have reached you due to several reasons. You may receive a notice from the department stating the outstanding tax amount. In this case, check all your documents and recalculate the tax liability and refund receivable. If the figures you have filed in the returns form are correct, file a rectification return under Section 139(4) supporting your claim. Or you might have forgotten to add a deduction. There could be other reasons, too,” says Archit Gupta, founder, and CEO, Cleartax, a tax portal.

What should you do if you have not received the refund yet?

you have not received the refund yet, you could check the refund status by logging into the income tax e-filing portal. You must follow the below steps to view the refund status:

· First, visit the income tax e-filing portal and log in to your account using your login credentials.

· Second, click on e-File>Income Tax Returns>View Filed Returns.

· Third, you must go to the relevant assessment year if you want to check the refund and the ITR status.

· Fourth, the status of your refund will be displayed in a new window along with the information.

· Fifth, if your ITR is processed but refund is not issued, it will show the status ‘Processed with refund due’. It normally takes 20 to 45 days after the ITR processing to receive the refund amount.

“You can also visit the tin-nsdl website (https://tin.tin.nsdl.com/oltas/refundstatuslogin.html) to check the income tax refund status. The refund status will be displayed after you enter the PAN, relevant assessment year, and the captcha code in the above link,” says Gupta

It Is Upon Taxpayer to Prove That He Has No Any Intention Of Committing Any Offense: Madras High Court

Madras High Court has recently ruled in a case that the burden to file income tax return is on the assessee.

In this case, the petitioner has relied on the fact that he is not required to file ITR due to difference between data as reflected in Form 16 and Form 26AS. This is the reason that the assessee considered himself bona-fide even after receiving several show cause notices.

The court held that this cannot be treated as a bona-fide mistake and it cannot be presumed that he has no intention of committing any offence.

“The burden lies on the assessee to show that he had no wilful intention not to file the return. Any explanation to discharge such burden can be tested only during the course of the trial,” the bench said. Further it mentioned that it cannot presume that the petitioner is innocent of any of the offences complained. “It is for the petitioner to establish such innocence,”, the court said.

PF Threshold Limit Raised to Rs. 5 Lakhs for Tax-Free Interest

PF threshold limit raised to Rs. 5 lakhs for tax-free interest

PF threshold limit raised to Rs 5 lakh for tax-free interest where there is no contribution by employer. In the Union Budget 2021, FM had provided that interest on employee contributions to provident fund over Rs 2.5 lakh per annum would be taxed from 1st April, 2021.

FM had capped the tax-free interest earned on provident fund contribution by employees and employers together to a maximum of Rs 2.5 lakh in a year in an attempt to dissuade high earners from parking their surplus in what is supposed to be common man’s retirement fund.

Exemption is Conditional  

This exemption, however, is subject to condition that the up to Rs 5 lakh contribution does not include employer’s contribution beyond the statutory limit of up to 12 per cent of the basic pay.

Source: News Articles

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.

Concessional 5% withholding tax continues for debt interest income of FPIs

Concessional 5% withholding tax continues for debt interest income of FPIs

The Income Tax department on Wednesday said that concessional rate of tax of 5 per cent shall continue for certain interest income of foreign portfolio investors.

Clarifying on reports which said that concessional withholding tax rate of 5 per cent on interest income of FPIs has been withdrawn, the Central Board of Direct Taxes (CBDT) said there is no change in the rate of tax chargeable.
“It is hereby clarified that there is no change in the said provision even after amendment of section 115AD vide Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 and the concessional rate of tax of 5% shall continue to be applicable for interest income referred to in section 194LD of the Act,”.

The issuer of the debt instrument has to withhold 5 per cent tax before crediting interest to the FPI.

No retro taxation on interest earned for EPF/GPF contributions of over ₹2.5 lakh

1. Crux / Summary in Brief
Interest of more than ₹2.5 lakh earned annually from contribution to Employees Provident Fund (EPF) or Government Provident Fund (GPF) will not be taxed retrospectively, Expenditure Secretary TV Somanathan clarified.
 
️2. Announcement was made at:
BusinessLine webinar on ‘De-coding the Budget 2021-22’.
The webinar was powered by HDFC Bank with BSE as an associate sponsor.
 
3. EPF taxation
EPF is the only saving instrument where one gets tax exemption at the time of contribution, then on the accumulation and, finally, at the time of withdrawal. This is called EEE (Exempt-Exempt-Exempt) mechanism.
 
4. Additional info – Exemption
  • GPF and EPF flows into an account above ₹2.5 lakh will be directed to a separate sub-account. 
  • The primary account including your past balance as on March 31, 2021 will always remain tax free; 
  • Interest will also not have to be declared.
5. Source of this information:
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