New Delhi: The Income Tax department has launched a new e-facility to link a person’s Aadhaar with the Permanent Account Number (PAN), a mandatory procedure for filing IT returns now.

The department’s e-filing website https://incometaxindiaefiling.gov.in/ has created a new link on its homepage making it easy” to link the two unique identities of an individual.

The link requires a person to punch in his PAN number, Aadhaar number and the exact name as given in the Aadhaar card”.

After verification from the UIDAI (Unique Identification Authority of India), the linking will be confirmed. In case of any minor mismatch in Aadhaar name provided, Aadhaar OTP (one time password) will be required,” the department said in its advisory to taxpayers and individuals.

The OTP will be sent on the registered mobile number and email of the individual.

It urged them to ensure that the date of birth and gender in PAN and Aadhaar are exactly the same, to ensure linking without failure.

There is no need to login or be registered on e-filing website (of the I-T department). This facility can be used by anyone to link their Aadhaar with PAN,” it said.

The government, under the Finance Act 2017, has made it mandatory for taxpayers to quote Aadhaar or enrolment ID of Aadhaar application form for filing of income tax returns (ITR).

Also, Aadhaar has been made mandatory for applying for permanent account number with effect from July 1, 2017.

The department, till now, has linked over 1.18 Aadhaar with its PAN database.

While Aadhaar is issued by the UIDAI to a resident of India, PAN is a ten-digit alphanumeric number issued in the form of a laminated card by the IT department to any person, firm or entity.

PTI

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An investor within the scheme has an option to choose funds based on her level of safety and risk in addition to choosing her own fund manager

The National Pension System (NPS) has been advertising a lot about the new tax deduction of Rs.50,000 for tax payers. I wanted to know more about the new deduction under section 80CCD(1)(b). Is this available only for people whose employers are investing in NPS on their behalf, or is this available for general public as well? How does the deduction work with respect to other tax benefits?
—Praveen Aggarwal

NPS is a voluntary pension scheme regulated by the Pension Fund Regulatory & Development Authority (PFRDA). It was introduced as an investment option to provide for the country’s growing working community to ensure that they have an option to save for their retirement needs. The purpose was to replace the existing system of defined benefit pension to a defined contribution-based pension system.

An investor within the scheme has an option to choose funds based on her level of safety and risk in addition to choosing her own fund manager. The returns are market-linked and, hence, do not give any form of guarantee.

NPS follows an EET (exempt-exempt-tax) model—exempt at the time of contribution or investment, exempt at the time of earnings and taxable at the time of withdrawals.

Section 80CCD under the Income-tax Act, 1961, provides the tax incentive at the first stage of investment—for getting the benefit of deduction for contributions made towards NPS.

This deduction is available to all individuals—salaried as well as non-salaried. This deduction was earlier restricted to Rs.1 lakh for each financial year under section 80CCD(1) and was subsequently increased to Rs.1.50 lakh.

To further boost savings, in Budget 2015, a new section, 80CCD 1B, was introduced, under which an additional deduction of up to Rs.50,000 was allowed for contribution made towards NPS. This made the total deduction under section 80CCD to Rs.2 lakh.

If we go through the provisions of section 80CCD, there is a lack of clarity whether the additional deduction of Rs.50,000 is after exhausting the limit of 10% of salary. Is the cap on deduction of up to 10% of salary (basic + dearness allowance) under section 80CCD (1) and within the overall ceiling of Rs.1.50 lakh or is it over and above the ceiling of Rs.1.50 lakh?

While this ambiguity remains, the intent was clarified in an example quoted by the finance minister in his budget speech this year, in which it was clarified that the assessee can claim additional deduction and the deduction of Rs.50,000 was over and above the ceiling of Rs.1.50 lakh.

Let’s take an example. If you have exhausted your Rs.1.50 lakh limit of deduction under section 80C by savings in Public Provident Fund (PPF), insurance premiums, repayment of housing loan, among other things, you can further increase your tax savings by contributing up to Rs.50,000 towards NPS.

You could open an NPS Tier I account, which is the first level, to claim the tax benefits.

Source: LiveMint

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Press Information Bureau
Government of India
Ministry of Finance

30-July-2013 20:05 IST

Overwhelming Response for e-filing from Every Corner of the Country; More than 82 Lakh Returns E-Filed till 29th July, 2013 which is More than 40% of the Returns e-filed during the Same Period Last Year; Record Peak of more than 85,000 Returns Per Hour Achieved

The due date for filing of Income Tax Return for individuals and non-auditable cases is 31st July, 2013. There has been an overwhelming response for e-filing from every corner of the country. More than 82 lakh returns have been e-filed till 29th July, 2013 which is more than 40% of the returns e-filed during the same period last year.

On 30th July, 2013, 6.23 lakh returns were e-filed till 6:00 PM. Record peak of more than 85,000 returns per hour has been achieved.

Due to overwhelming response, some taxpayers have reported problems in accessing e-filing portal which is primarily due to network constrains of the local internet service providers. The e-filing portal has been running without any interruptions and is being continuously monitored by a dedicated team of income tax officials in Bangalore. The situation will again be reviewed by the CBDT tomorrow morning.

*****
Source: PIB
(Release ID :97490)

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First they made it compulsory for businesses to e-file their tax returns. Then they made it mandatory for taxpayers with incomes of over 10 lakh to take the online route. This year, the income tax authorities have cast a wider net and made e-filing compulsory if your taxable income is above 5 lakh a year.

The lowered threshold represents one of the key changes in the tax filing rules this year. Some of these are mere tweaks, such as mentioning your bank’s IFSC number, instead of the MICR code, in the return. However, some of these variations are tectonic, such as the mandatory e-filing for incomes above 5 lakh a year. In the following pages, ET Wealth explains the new rules and how they will affect the way you file your tax return this year.

E-filing tax returns

The change has spawned a massive opportunity for tax e-filing portals. These websites charge individual taxpayers between 200 and 4,000 for uploading their tax returns. You can also do it for free on the official website of the Income Tax Department. However, private tax filing portals hand-hold the taxpayer through the process. They guide you while filling the form and even correct you if you make a mistake.

Filing tax returns online is easy. The average taxpayer won’t take more than 30-40 minutes to enter all the details and upload the return. However, the average taxpayer also harbours several misconceptions about e-filing . Tax returns are picked up for scrutiny through a computer assisted selection procedure that has no human intervention. If the computer detects certain discrepancies in the return, it raises the red flag and the individual gets a notice. In fact, there is a greater probability that a return filed offline will get picked up for scrutiny . The information in your physical return is ultimately fed to the computer by operators. A typing error at this stage can introduce a discrepancy in the return, leading to a notice being sent to you.

This problem can be avoided when you file online because the chances of going wrong are lesser. The e-filing portals further reduce the risk of errors by calculating the tax as you fill in the form. Some e-filing companies , such as Taxspanner, even verify your return for a small fee. If you are ready to shell out 200, the portal will check if you have entered correct information and alert you when you are going wrong. Tax professionals go through your return form, tallying the numbers and cross-checking the information before it is uploaded.

Choose the right form

The online filing data reveals that more than 32% of the 2 crore individual taxpayers used the basic ITR 1, also known as Sahaj, to file their returns last year. Only 11% used the more complicated ITR 2. These statistics indicate that a lot of taxpayers who should have used ITR 2 filed their returns using the simpler Sahaj form. The income level does not matter; what is important is the source of income. For instance , if one had made capital gains or earned rent from more than one house, he should have used ITR 2.

If you have not filed your return for last year as well, you can do so now. A return filed after the due date is a delayed return. If you file your delayed return before you get a notice, you have a better chance of getting away lightly. The taxman will not take you to task for not filing your returns, just give you a mild rap for waking up late.

Automatic choice for e-filers

For some online tax filers, choosing the right form is not an issue. “A taxpayer has to just enter what he has earned under different heads of income and the portal automatically chooses the applicable form,” says Sudhir Kaushik, co-founder and CFO of Taxspanner.com. For instance, if the person has only income from salary and no exempt income, his return will be filed using ITR 1, but if he made some capital gains, has rental income from more than one house or his exempt income exceeds 5,000, ITR 2 will have to be used.

However, taxpayers who upload their returns through the official Income Tax Department website will have to be more careful about the form they use. Delhi-based Kuldip Kaushik used the ITR 1 last year, but since he had dividend income of over 5,000 for the year 2012-13 , he will have to use ITR 2 this year.

If a taxpayer uses the wrong form and the mistake is discovered by the tax authorities, the return may be rejected . Every year, thousands of defective returns are sent back to taxpayers. A defective return is not an earth shattering matter. If you get a notice, you will have to file a revised return within 15 days. If you meet the deadline, the return is treated as valid. Get delayed and your return will become invalid and you will have to file afresh.

“If you discover on your own that you have made a mistake in the return or used the incorrect form, you can file a revised return to rectify the mistake ,” says Vineet Agrawal, director KPMG. Your new return will overule the previous one if the assessment has not been completed.

Check your TDS details

Before you sit down to file your returns this year, spend a few minutes to check whether the tax you paid for last year has been correctly credited to your name. The Form 26AS has details of the tax deducted on behalf of the taxpayer and can be easily checked online. Noida-based Brijendra Singh wishes he had done so last year. The former army officer got a tax notice because of a clerical error by his bank. The TDS paid on his income from fixed deposits was credited to another PAN by mistake. Though he was eventually given credit for his TDS, Singh is not taking any chances this year. He has diligently matched all his TDS details with his Form 26AS online.

Checking your tax credit details online is child’s play if you have a Net banking account with any of the 35 banks that offer this facility. Otherwise you can go to the official website of the Income Tax Department and click on ‘View Your Tax Credit’ . First-time users will have to register but it takes less than five minutes before you can log on and view your details. “It is necessary that taxpayers check their TDS when they file their returns,” says Kuldip Kumar of PwC.

Forms seek more information

If salaried people are feeling jittery about using the more detailed ITR 2, imagine what partners in firms and businessmen are going though. In an attempt to dig deeper for undisclosed income, the government has made it mandatory for partners, professionals and businessmen with an income of over 25 lakh to furnish details of their assets and liabilities. There is a new ‘Schedule AL’ in the ITR 3 and ITR 4. If the taxpayer’s income exceeds 25 lakh during the year, he will have to declare his assets and liabilities.

Source: http:timesofindia.indiatimes.com

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Congress Leaders requested Finance Minister to raise Income tax exemption Limit to Rs.4 lakhs in the budget 2013-14

In a pre-budget meeting with Finance Minister P Chidambaram here on Thursday, Congress leaders have asked the UPA government to increase the taxable income exemption limit to Rs 4 lakh from the current Rs 2 lakh, while suggesting a pro-people budget with sops for the middle class and farmers keeping  the upcoming elections in mind.

The meeting was held at the Congress party headquarters. With the rise in fuel prices impacting the ‘aam aadmi’, the meeting saw suggestions for varied pricing of petrol, diesel and cooking gas for people living below poverty line and low income group.

Senior party leader Oscar Fernandes suggested there was a need to bring down the dependence on petroleum import and more focus on having alternative sources of energy like ethanol, sources said. Fernandes also wanted the government to reduce tax on bidis, noting that employment levels were coming down in the labour-intensive sector due to current tax slab.

Congress leader Jagdish Tytler suggested that the budget should be formulated in a way that helps the party to connect with people as elections were ahead, sources said.

AICC Secretary P Sudhakar Reddy mooted raising the tax exemption limit of Rs 2 lakh to Rs 4 lakh, which was endorsed by many other office bearers.

He also advised linking Mahatma Gandhi National Rural Employment Guarantee Scheme with agriculture to help meet the shortage of farm labour in the sector, besides offering three-year interest-free loans to small farmers for their children’s education.

Suggestions were also made by party leaders for gender budgeting. Reddy advised the Finance Minister that female assessees could be given higher tax exemption limit.

There were also demands by many leaders for bringing more clarity on the service tax as it was being interpreted differently in various states.

Minority Department Chairman Imran Kidwai demanded increase in outlay of the Minority Affairs Ministry and allocation of more funds to minority institutions. He also advised formulation of special scheme for Most Backward Classes for their financial inclusion.

Senior party leader Ajit Jogi complained that central funds were being diverted in many non-congress ruled states by the respective governments, suggesting some mechanism should be developed to check this, “The finance minister told us what are the difficulties and how the Indian economy was kept at a balance despite the tough global economic scenario. Thirty-two of the 46 office bearers present spoke on various issues related to farmers, weavers, education, health and income tax,” party general secretary Janardan Dwivedi told reporters after the meeting.

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