gst-in-jaipur

[gst-in-jaipur]

ITR FILING

In India, for FY 2020-21 (i.e. Assessment Year 2021-22), filing of Income Tax Return (ITR) is due. In general, the Due Date of filing is July 31, 2021 for non-audit-business assesses, and Oct 31, 2021 for audited-business-assesses. Therefore, in most of the cases, generally, July 31 (i.e. presently July 31, 2021) is relevant due date (generally for mostly Individuals). Hence, it is high time and important for all individuals to get ready with all information & documents for the preparation of an Income Tax Return. Some people (for various reasons) do not pay much attention for ITR Filing in India before the due date. Here, it is important to understand that why the ITR must be filed before the due date.

Here are certain useful & relevant points, which show the importance of ITR filing by the due date and must be considered for the purposes of filing of ITR before the Due Date:

Levy of Interest Penalty: The very first impact of not filing of ITR by due date is that a Penal Interest @ 1% gets attracted (u/s 234A of the Income Tax Act, 1961 "Act")). This penal interest is charged on Tax Liability Payable, and is charged in addition to normal interest of section 234B of the Act. Hence, non-filing of an ITR, by Due Date, will lead to double interest i.e. one, a normal interest u/s 234B and two, a penalty interest for non-filing of ITR by Due Date. Any person, once misses the due date, awakes very late (i.e. after receiving an IT Deptt Letter or Arising of a need for Loan/Visa/Otherwise) and till that date a big amount of interest gets accrued, which become a burden for assessee at that stage.

Levy of Penalty Fee: U/s 234F of the Act, if ITR is not filed by due date then a late penalty fee needs to be paid which varies from Rs 1,000 to 10,000. Also, there are prosecution provisions in case of non-filing of ITR.

Late ITR Late Refund: If ITR is filed with delay then the ITR will get processed also with delay and the same will lead to late processing of ITR in Refund cases. Hence, assesse will face delay in getting the refund back from the IT Deptt. Here, it is important to understand that most of the assesses (who file their ITR by due date) are used to file their ITR in last 10 days before Due Date. However, if the ITR is filed much before the due date (i.e. 1-2 months before) then the processing of those ITRs will be done first and refund processing shall also happen accordingly on FIFO basis. Hence, in addition to filing ITR by Due Date, filing well before Due Date is important for hereby mentioned reason.

Less Time For Filing of Income Tax Return: As per the latest provisions of the Act, ITR can not be filed after the end of relevant assessment year (even with late fee). Hence, If ITR is not filed by the due date, there will be left very less time to file the ITR. And once the ITR is missed and not filed by the end of assessment year it will lead lots of inconveniences in the form of IT Deptt Notice, Refund loss etc.

Chances of Income Tax Notice as well Scrutiny Notice: In today scenario, through various sources IT Deptt is aware of assessees major financial transactions, property transactions, bank deposits, credit card transactions etc. Also, if any income is earned by assessee, the IT deptt is aware of those transactions through TDS records (i.e 26AS). In these kind of situations, if assesse does not file the ITR by due date and thereafter, the same may lead to some Income Tax Notice from the IT Department (through IT Deptt Compliance Cell or otherwise) and in some cases to Income Tax Scrutiny Notice as well.

Reminders From Income Tax Department: Now, the IT Deptt have full records of assesses. If an ITR is not filed by due date, IT Deptt starts sending communications via emails, sms etc. These communications trouble the assesse. Also, in IT Deptt records, assesse information gets place in defaulter/non-compliant assesse. Hence, for these reasons also, it is very important to comply the Tax Rules (specifically for filing ITR before Due Date).

Carry Forward of Losses Not Allowed: If assesse has incurred some losses during the year (business loss, loss on sale of shares/mutual funds etc) then as per the provisions of the Act same can be carried forward to next years to set off against future year profits. However, if the assesse files the ITR late (ie after due date) then assesse loses the right of carry forward of losses. Hence, in nutshell, for losses ITR, one should be very cautious to file ITR wrt filing of same by due date. Here, it is important to understand that in loss cases, assesse thinks that there is no tax payable, hence, ITR lapses for filing by Due Date, which become a bottleneck in carry forward of losses and the losses lapses.

Importance of Tax Return: ITR is a very important legal document and is very helpful before various authorities and at various places e.g. for VISA purposes, Loan purposes etc. Even in various proceedings in the Income Tax Department,  ITR Filing in india(by Due Date) provides lots of strengths to assesses representations.

Prosecution: As per the new provisions of Income Tax Law, intentionally non-filing of ITR (by due date) can lead to initiating of prosecution provisions by the the Tax Authorities.

Foreign Assets: As per the latest Budget (passed by Loksabha & RajyaSabha) i.e. Finance Act 2019, it is proposed that all Resident Assessees, who have foreign assets or financial interest, are compulsorily required to file their ITR whether they have taxable income or not. Here, even in honest assesse cases, through filing of ITR the due needful can be taken care by them, which will avoid unnecessary hassles to them by the Investigation Deptt of Income Tax Office.

Black Money Act: Now, with the passage of Black Money Bill (in relation to foreign undisclosed assets and income) it is very pertinent for Resident Assessees, who have foreign sources of assets and/or income, to file an ITR and take needful timely decisions in relation to disclosure so that harshest penal provisions of this new Act can be minimized or avoided or taken care of.

Here, it is important to understand that though as per the provisions of the Act, one has time of one year to file belated returns. For instance, for FY 2019-20, belated returns can be filed till March 31, 2021 (with late fee penalty etc). Though this date is extended upto May 31, 2021 due to covid. However, this should not be considered a tool to sit back and relax as the same may lead to various penal provisions & inconveniences. In the current era, where various new information technologies have been launched by the Tax Department, delay in ITR filing will automatically lead to triggering of various trouble-raising mechanism by the Department. Also, in the light of insertion of new laws (e.g. Black Money Act), ITR filing (By Due Date) is very very important.

Also, it is found that once the ITR is not filed by Due Date, assesse even lapses the maximum time available for filing an ITR, and in that case non-filing of ITR leads to non-repairable losses to assesses.

It is also very important to understand that ITR should not only be filed by Due Date but should be filed well before Due Date so that last hours inconveniences can be avoided and benefits of early filing are gained.  

Get your ITR filing in India by CA Goyal Mangal & CO.

[gst-in-jaipur]

GST

The Goods and Services Tax (GST) system came into effect in India from 1st July 2017. The implementation of this tax system has been one of the most monumental economic reforms in India. This ‘one nation, one tax’ reform subsumed most of the indirect taxes levied at the center and state levels and brought about uniformity in terms of tax administration. Let's take a look at the advantages of GST. Register your business and get GST registration services in Jaipur.

Components of GST

Taxes applicable under the Goods and Services Tax.

State Goods and Services Tax (SGST): Tax levied by the State Government

Central Goods and Services Tax (CGST): Tax collected by the central government

Integrated Goods and Services Tax (IGST): Tax applicable on inter-State supply of goods and services by the central government

The introduction of GST positively influenced the Indian economy. This tax has taken apart the inter-state barriers that hinder trade and has brought the economy together in a single unified market. Manufacturers and traders both benefit from this form of taxation. The end consumers have also greatly benefited from the enforcement of Goods and Services Tax in numerous ways.CA Goyal Mangal provides GST registration services.

Advantages of GST Explained in Details

1. Reduced Tax Evasion and Corruption Free Tax Administration

The enforcement of the GST Act has made tax administration transparent and corruption-free. The evasion of tax leads to the outflow of government revenues. This is a significant disadvantage to compliant taxpayers. To curtail evasion of tax, various measures have been undertaken by the authorities:

Syncing of GST registration and PAN

Reporting and matching at the invoice level

Reconciliation of credits

Generation of e-way bills

Tracking of movement of goods

Appointment of GST Commissioner for Investigation

Directorate General of Analytics and Risk Management

2. Procedural Benefits

Common procedures for registration

Lesser tax filings and uniform formats

Clear and transparent rules

Ease of bookkeeping

Lesser revenue leaks and generation of better revenues

Refund of taxes

Common tax base

Universal system of classification of goods and services

3. Removal of Cascading Effect

The pre-GST period saw a cascading effect of taxes, which the implementation of GST eliminated. GST has almost entirely put an end to the tax-on-tax impact on goods and services. By taking in all the indirect taxes under its wing, GST has managed to bring down the cost of goods and services. Thus uniformity of taxes under GST is one of its crucial benefits.

4. Technologically Driven

Being technologically driven, the entire process of registration and filing of returns is accelerated. It also ensures that the process is clean and tax collection is done legitimately. The Gst Portal supports the following activities:

Registration

Return filing

Application for refund

Response to notices

Consumer grievances

5. Reduced Compliances

The number of separate compliances is lesser now with GST. Earlier VAT, Excise and Service tax had their own schedules of filing and compliances. These were monthly or quarterly, depending on the nature of holding. GST, however, requires a single return to be filed. There are around 11 returns, 4 out of which are basic returns that all taxable persons need to file.

6. Higher Exemption Limit

The GST Council doubled the exemption limit for the sale of goods to Rs 40 lakhs. The exemption limit for the northeastern states is Rs 20 lakhs. The exemption limit for service providers is Rs. 20 lakhs for all states excluding special states for which it is Rs.10 lakh. With effect from April 1, 2019, the annual turnover for availing Composition Scheme was increased to Rs 1.5 crore from Rs 1 crore. A taxpayer with an annual turnover under Rs 1.0 crore can go for this Composition. For North-Eastern states and Himachal Pradesh, this limit stands at Rs 75 lakh. This scheme relieves small taxpayers from the tedious GST formalities. GST under this system can be paid at a fixed rate of turnover. According to the CGST (Amendment) Act, 2018, which came into force from 1st of Feb, 2019, a dealer under this scheme can supply services up to 10% of the annual turnover, or Rs.5 lakhs, whichever is higher. Under this scheme, a cumulative turnover is taken into consideration of different businesses that are registered under the same PAN number. This move alternating the exemption limit is highly beneficial for small businesses.

7. GST and Make In India Campaign

With the application of GST on imports and a boost to manufacturing with a reduction of unnecessary costs, GST forms the backbone of this initiative. The ease of transaction and the free flow of goods through the state border with the elimination of commercial check posts is another advantage. By replacing the arbitrary taxation system, the GST model has unified the Indian market. Reduction of the costs of logistics, lesser transit hours, and relief from export taxes and refunds has given a considerable boost to manufacturing.

8. Ease of operation for E-commerce businesses

Initially, for e-commerce businesses, the supply of goods across the border came under variable tax laws. The delivery trucks crossing borders were required to produce the necessary documents along with the VAT declaration and registration number. Failure to produce the required documents could lead to the confiscation of goods. GST has more or less eradicated all such complications, paving the way for seamless transactions.

Conclusion

The enforcement of GST has brought in a very transparent system to the country that is also corruption-free. The benefits are far-reaching and are not only business-friendly but consumer-friendly as well. This system of taxation has placed the country well in international trade. The Indian market is far more stable now than it ever was. With the application of GST, India is in a much better position in the international markets, which has positively affected the economy.

CA Goyal Mangal & Co. Provides professional GST registration and all legal services.