Got an I-T notice on cash deposits? Don't panic and follow this guide

The Reserve Bank of India (RBI), in tandem with public sector and commercial banks, has undertaken data mining on a massive scale to identify how funds have been moved in the country after November 8. The government has come down hard on individuals and businesses operating doctored accounts, having deregistered and shut more than 100,000 companies and penalised more than 300,000 others. The I-T department has also identified over 37,000 shell or paper companies channelling black money through methods such as hawala. As a part of its Operation Clean Money, the I-T department identifies individuals whose income tax return filings are inconsistent with the amount of cash deposits made in their bank accounts during the demonetisation drive. It then sends a notification through SMS or e-mail, and the individual must provide a response on the department’s website for the same.

If you receive such a notice, do not panic or ignore it. First, verify that the PAN (Permanent Account Number) stated on the notice is yours. Since the I-T department issues notices to a specific PAN and not based on your name, there are chances that an erroneous notice may have been sent to you instead of someone else with the same name or birth date as yours. If you have received such a notice, irrespective of whether you have made the transactions or not, you must log into your account to submit a response. Here's how:

• Visit the income tax department website, https://incometaxindiaefiling.gov.in, and log into your e-filing account.

• Click on 'Cash Transactions, 2016' under the 'Compliance' tab. The page will then list all cash deposits made by you between November 9 and December 30, 2016. 

• Before you begin the verification process, make sure you have all pertaining documents such as receipts for cash income, past tax returns, etc. 

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Aaykar Setu: Now solve IT RETURN issues, pay taxes, apply for PAN, via CBDT app

Paying IT RETURN, applying for PAN and seeking redressal of grievances have become easier as the tax department today launched an app allowing taxpayers perform basic functions through their smartphone.

The mobile app will also help people link their 12- digit biometric identifier Aadhaar with Permanent Account Number (PAN) card as well as track the TDS deduction details.

The mobile app 'Aaykar Setu', launched by Finance Minister Arun Jaitley, literally means bridge for taxpayers and will be available in Android phones.

"This is a very important step forward by the CBDT and the principle reason being technology as a very powerful tool becomes an enabler. (With the app) most of the work the assessee can discharge without any external help sitting at home," the minister said.

This is the first mobile app by the CBDT and can be downloaded by giving missed calls to 7306525252.

The app will have a live chat facility named 'Chatbot' from 10 am to 6 pm which will provide solution to queries of taxpayers relating to PAN, TAN, TDS, return filing, refund status and tax payments.

Besides, people can also have a live chat with tax experts and provides address of nearby tax return preparer.

It provides ease of use of all the services related to tax payment including tax payment, tax calculation. Also if a taxpayer has a problem, this app will help in lodging his grievance in the e-Nivaran module of the CBDT.

IT RETURN: Now, pay GST if you earn over Rs 20 lakh per year as rent

IT RETURN - Rental income from residential property has been exempt from GST but any earning over Rs 20 lakh annually from renting or leasing for commercial purposes would attract the levy.

Revenue Secretary Hasmukh Adhia said that if the house property is rent out for shop or office purpose, no Goods and Service Tax (GST) will be levied up to Rs 20 lakh.

"Rental income received from residential house is exempt. But if you have given your unit to commercial enterprise, then it is taxable if you are getting more than Rs 20 lakh as rent," Adhia said at the GST Master Class.

The taxpayer earning more than the exempted threshold will have to register with the GST Network and pay taxes.

GSTN Chief Executive Prakash Kumar said that as many as 69.32 lakh registered excise, service tax and VAT payers have migrated to the GSTN portal. There are over 80 lakh such assessees in the earlier indirect taxation regime.

Out of the 69.32 lakh, as many as 38.51 lakh have completed the entire registration process and registration certicate is being issued to them.

The remaining 30.8 lakh taxpayers are being sent SMS and emails by GSTN so that they complete the registration process by giving the details of the business like main place of business, additional place of business, promoters details.

Besides, over 4.5 lakh new assessees have registered on the GSTN portal since June 25.

Adhia further said that the facility to amend the details of businesses provided to the GSTN portal at the time of registration will open on July 17. Also, registration for GST practioners will open on the same day.

Besides, cancellation of registration can be done online.

GST readiness: EY launches helpdesk to ease transition for small firms

Tax consultancy firm EY has launched a GST helpdesk for small businesses wherein they can post their queries on the new indirect tax regime online.

EY GST Helpdesk is driven by a pool of indirect tax professionals powered by over 800 GST practitioners across 14 cities.

The facility would be available for free to small businesses, traders and entrepreneurs to achieve a seamless transition to GST and queries can be posted on EY India Tax Insights App, DigiGST website and EY_India on Twitter.

"This facility will help in enabling a smooth transition for smaller businesses and traders across the country," EY India Chairman Rajiv Memani said.

Businesses are in the midst of ensuring GST compliance and they have to align their software systems as per the GST requirement as well as adapt themselves to the new return filing and invoice generating format.

"We believe this helpdesk will be of great help to small entrepreneurs and help them realise the benefits of GST," EY India National Tax Leader Sudhir Kapadia said.

Goods and Services Tax (GST), rolled out from July 1, unifies 17 different taxes like excise, service tax and VAT and will transform India into a single market for seamless transfer of goods and services.

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I-T to attach shares if Cairn Energy fails to pay Rs 10,395 cr tax

The tax department has slapped a fresh notice on UK's Cairn Energy Plc seeking to take over the firm's residual 9.8 per cent stake in its erstwhile Indian subsidiary to recover Rs 10,395 crore retrospective tax demand.

The tax department had in an unprecedented move had last month appropriated Rs 1,500 crore of tax refund due to Cairn Energy and another Rs 666 crore of dividend income due to it for three years from its erstwhile subsidiary (now Vedanta) to recover the Rs 10,247 crore of tax plus interest.

It has again written to Cairn Energy on June 26 asking it to repay the balance tax due, failing which it will take over its 9.8 per cent shareholding in Cairn India, a source said requesting not to be named as the information is not yet public.

In the notice, the Income Tax Department gave the British firm 15 days to repay or face attachment of shares.

The department moved to recover the tax after Cairn Energy lost an appeal against the retrospective tax demand in tax tribunal ITAT. It on March 31 issued a notice seeking Rs 10,247 crore tax by June 15. As the company failed to pay, it went ahead to take over the refund and dividend income.

The source said about Rs 2,200 crore recovered so far does not even fully cover the interest due on principal tax demand of Rs 10,247 crore which was levied over alleged capital gains the company had made in 2006 when it transfered India assets to a newly created firm, Cairn India and listed in on stock exchanges.

The outstanding tax demand is Rs 10,395 crore, he said, adding an interest at the rate of 1 per cent will keep adding up every month on the tax demand.

"Cairn Energy has time till July 11 to reply to the notice sent by tax recovery officer under Income Tax Certificate Proceedings rules. If the company does not reply, then the department is likely to issue warrant which will be followed by a formal share attachment notice," the source said.

Auditors' to disclose property related transactions above Rs 20,000 to I-T

Auditors will now have to disclose details of transactions exceeding Rs 20,000 in connection with immovable property in reports, which they file with the Income Tax (I-T) authorities on behalf of their clients.

Under the Income Tax Act, professionals earning gross receipts of more than Rs 50 lakh and companies with a turnover of Rs one crore and above are required to get their accounts audited. The turnover limit for companies has been increased to Rs two crore from Assessment year 2018-19.

So far, auditors in their report had to mention details of loans, and repayment exceeding Rs 20,000 in the tax audit report filed along with Income Tax returns. Henceforth, all transactions exceeding Rs 20,000 relating to immovable property will have to be mentioned in a specified format in the report.

The move will increase transparency in financial dealings and help check tax evasion.

As per the notification by the I-T department, auditors will have to furnish details of transactions regarding "each specified sum" exceeding Rs 20,000 from financial year 2016- 17. These would include money paid or received with regard to immovable property.

The auditor report will also have to specify details of the mode of payments whether account payee or bearer cheque, or through electronic system.

Through the notification, the tax department has revised the form 3CD for tax audit report under section 44AB of Income Tax Act.

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Nearly 15% growth in direct tax collections for FY18: CBDT

IT RETURN- Provisional figures for direct tax collections up to June 2017 show net collection at Rs 1.42 lakh crore, which was 14.8 percent higher than net collection for the corresponding period of last year.

A Central Board of Direct Taxes (CBDT) statement released on Thursday said the net direct tax collection represented 14.5 percent of total budget estimates of direct taxes for fiscal 2017-18 (Rs. 9.8 lakh crore).

Corporate Income Tax (CIT) gross collections grew at 4.8 percent, while the growth under Personal Income Tax (PIT), including Securities Transaction Tax (STT) was 12.9 percent.

However, after adjusting for refunds, the net growth in CIT collections was 22.4 percent, while that of PIT was of 8.5 percent.

The CBDT informed that refunds amounting to Rs.55,520 crore have been issued between April and June, 2017, which is 5.2 percent lower than refunds issued during fiscal 2016-17 in the same period.

An amount of Rs. 58,783 crore was received as advance tax up to June 30, 2017, reflecting a growth of 11.9 percent over advance tax payments for the corresponding period of last year.

The growth in Corporate Advance Tax was 8.1 percent and that in Personal Advance Tax was 40.3 percent.