New Delhi: If you are a taxpayer, there is some bad news for you. Some taxpayers may have to pay Tax Deducted At Source (TDS) at higher rates from July.
According to the Finance Act 2021, if you have omitted from filing your TDS in the last two years and the amount of TDS deducted each year exceeds Rs 50,000, the Income Tax department will charge you extra filing the income tax returns (ITR) from July 1.
Rate of TDS will be higher of the below limits
- Twice the rate specified according to the relevant section or provision
- Twice the rate/rates in force
- At the rate of five per cent.
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However, the Central Board of Direct Taxes (CBDT) has some good news for taxpayers as well. The CBDT has extended the deadlines to file income tax returns for the financial year 2021.
According to the circular, the last date of filing tax returns for the fourth quarter of the financial year 2020-21 has been extended to June 30 from the earlier May 31.
As a result, the due date of issuance of Form 16 has also been extended. The due date of issuance of Form 16 has been extended by a month to July 15.
New TDS rule will not be applicable in these cases
- Section 206AB will not be applicable for TDS deducted under Section 192 for salary or withdrawal from Provident Funds under Section 192A.
- TDS on prizes for winning card games, crossword, lottery, puzzle, horse racing or any other games under Section 194B or 194BB will not be under the purview of the newly implemented Section 206AB.
- It will not be applicable for cash withdrawal of over Rs 1 crore according to Section 194N and income against investment in the securitisation trust according to Section 194LBC.