Income Tax amid Coronavirus

Amid Coronavirus outbreak across the globe, the Finance Minister of India, Nirmala Sitharaman, announced various crucial strategies, reliefs, and significant decisions corresponding to Income Tax and GST, on 24th March 2020.

The FM has extended the date for filing the GST Returns for March, April, and May to 30th June 2020. Previously, the date for filing the GST returns was 31st March 2020. Also, the FM has extended the deadline for composition returns on GST to 30th June 2020.

Nirmala Sitharaman made these announcements while addressing the media on measures and guidelines to tackle the economic impact of the novel Coronavirus. She stated that there would be no different staggering dates concerning the filing of GST returns for March, April, and May.

Sitharaman further announced that business companies with a turnover of less than Rs 5 crore wouldn’t be charged any penalty or interest corresponding to the late filing of the GST. On the other hand, bigger business firms and companies would require paying an interest amount of 9% in the scenario of delayed GST filing; however, there wouldn’t be any penalty or late fee imposed.

The last date to opt for the compensation scheme has also been extended to 30th June 2020.

Furthermore, the FM announced that the deadline for filing the income tax returns for the Financial Year 2019-2020 has extended to 30th June 2020. The deadline for Aadhar-PAN linking has also been further extended to 30th June 2020. Additionally, the interest charged upon the delayed deposits of TDS (Tax Deducted at Source) has been reduced from 18% or 12% earlier to 9% now, and it will be charged till June 2020.

While addressing the media, the FM announced that customs clearance has now been made an essential service, which shall be working 24/7 till 30th June 2020. ‘Vivad-se Vishwas’ scheme (settling disputes for income taxes) has extended by three months to June 2020. Individuals who are looking forward to utilizing this scheme would not have to pay an additional charge of 10%.

As per Sitharaman’s announcements, debit cardholders can now conveniently withdraw cash from any ATM without being charged a fee for the next three months (till 30th June 2020), even if the ATM is not of the bank where the cardholder has his or her account. Moreover, there won’t be any minimum balance charges on all the bank accounts for three months.

In the case of the newly incorporated companies, there is a need to file the declaration for the commencement of the business within six months of incorporation; however, it has now been extended to six more months. A company’s director not complying with the minimum residency norm, that is, staying in the country for 182 days or more, won’t be treated as a violation. The mandatory requirement for holding board meetings has now been relaxed by a period of 60 days, and this relaxation holds for the next two quarters. For small scale businesses, insolvency proceedings’ threshold limit has extended from Rs 1 lakh to Rs 1 crore.

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