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Category: Union Budget

De-criminalisation of penalties for Companies Law breaches

De-criminalisation of penalties for Companies Law breaches

Through the Companies (Amendment) Act, 2019, changes were made in the Companies Act, 2013, inter alia, to convert 16 criminal offences into civil wrongs. This was stated by Shri Anurag Singh Thakur, Union Minister of State for Finance & Corporate Affairs, in a written reply to a question in Rajya Sabha today. Stating the chronology, Shri Thakur said that in continuation of the Government’s endeavour in similar directions, a Company Law Committee was constituted by the Ministry of Corporate Affairs…

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Clarification by IT department for NRI Taxation

Clarification by IT department for NRI Taxation

Government of India  Ministry of Finance  Department of Revenue  Central Board of Direct Taxes  New Delhi, 2nd February, 2020  CBDT issues clarification on the new provision pertaining to residence in India  The Finance Bill, 2020 has proposed that an Indian citizen shall be deemed to be resident in India, if he is not liable to be taxed in any country or jurisdiction. This is an anti-abuse provision since it is noticed that some Indian citizens shift their stay in low…

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Direct and Indirect Tax Reforms in Budget 2020

Direct and Indirect Tax Reforms in Budget 2020

Union Budget 2020-2021 key Highlights:  Direct Tax: 1. New Tax slabs for Individuals, HUF, AOP, BOI, AJP are optional. Assessee can also opt for old regime with exemptions and deductions. New slabs are: – Those earning up to Rs 5 lakhs are exempt from paying taxes. 10% tax for everyone earning Rs 5-7.5 lakhs against the current 20%. 15% tax for everyone earning Rs 7.5- 10 lakhs against current 20%. 20% tax for everyone earning Rs 10-12.5 lakhs against current…

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An overview of Union Budget 2020

An overview of Union Budget 2020

Introduction 1. We are now the 5th largest economy of the world. Agriculture, Irrigation and Rural Development 2. Scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid would be operationalized. 3. Government will provide Viability Gap Funding for setting up efficient warehouses at the block/taluk level. 4. Indian Railways will set up a ‘Kisan Rail’ – through PPP arrangements to build a seamless national cold supply chain…

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Section 115BAC – New income tax slab rates for Individuals and HUFs inserted by Finance Bill 2020

Section 115BAC – New income tax slab rates for Individuals and HUFs inserted by Finance Bill 2020

New Income tax rate for individuals and HUFs   A new section 115BAC is inserted in the Income Tax Act by Finance Bill 2020 which provides following On satisfaction of certain conditions, an individual or HUF shall, from P.Y. 2020-21, A.Y. 2021-22 onwards, have the option to pay tax in respect of the total income at following rates:   Total Income (Rs) Rate Upto 2,50,000 Nil From 2,50,001 to 5,00,000 5 percent From 5,00,001 to 7,50,000 10 percent From 7,50,001…

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Clarification on new provision pertaining to resident in India

Clarification on new provision pertaining to resident in India

The Finance Bill, 2020 has proposed that an Indian citizen shall be deemed to be resident in India, if he is not liable to be taxed in any country or jurisdiction. This is an anti-abuse provision since it is noticed that some Indian citizens shift their stay in low or no tax jurisdiction to avoid payment of tax in India. The new provision is not intended to include in tax net those Indian citizens who are bonafide workers in other…

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Analysis of the ICAI pertaining to tax proposals of Union budget-2020-21

Analysis of the ICAI pertaining to tax proposals of Union budget-2020-21

The Union Budget is stated to be centered around three significant themes – Aspirational India, Economic Development and Caring Society – all of which are directed towards ease of living. A tax measure directed towards the first theme, namely, Aspirational India is the levy of health [email protected]% as a duty of customs on import of medical devices to be utilised for creating health infrastructure and services.   Since the specified medical devices are now being manufactured in India, this cess would also boost the domestic industry….

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Deferring tax payment in respect of income on ESOPs for startups

Deferring tax payment in respect of income on ESOPs for startups

ESOPs have been a significant component of the compensation for the employees of start-ups, as it allows the founders and start-ups to employ highly talented employees at a relatively low salary amount with balance being made up via ESOPs. Currently ESOPs are taxed as perquisites under section 17(2) of the Act read with Rule 3(8)(iii) of the Rules. The taxation of ESOPs is split into two components: i. Tax on perquisite as income from salary at the time of exercise….

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Dividend now taxable in the hands of the shareholder

Dividend now taxable in the hands of the shareholder

  Removing dividend distribution tax (DDT) and moving to classical system of taxing dividend in the hands of shareholders/unit holders. Section 115-O provides that, in addition to the income-tax chargeable in respect of the total income of a domestic company, any amount declared, distributed or paid by way of dividends shall be charged to additional income-tax at the rate of 15 per cent. The tax so paid by the company (called DDT) is treated as the final payment of tax…

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Amendment in provisions relating to verification of the return of income of a company and LLP

Amendment in provisions relating to verification of the return of income of a company and LLP

Section 140 of the Act provides that in case of company the return is required to be verified by the managing director (MD) thereof. Where the MD is not able to verify for any unavoidable reason or where there is no MD, any director of the company can verify the return. It is also provided that in case of a company in whose case application for insolvency resolution process has been admitted by the Adjudicating Authority (AA) under the Insolvency…

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