TMI BlogIncome-tax Deduction from salaries during the Financial Year 2019-20 under section 192 of the Income-tax Act, 1961X X X X Extracts X X X X X X X X Extracts X X X X ..... he Income Tax Department- ww w.incometaxindia.gov.in. 2. RATES OF INCOME-TAX AS PER FINANCE ACT, 2019: As per the Finance (No.2) Act, 2019 , income-tax is required to be deducted under Section 192 of the Act from income chargeable under the head Salaries for the financial year 2019 -20 (i.e. Assessment Year 2020-21) at the following rates: 2.1 Rates of tax A. Normal Rates of tax: Sl No Total Income Rate of tax 1 Where the total income does not exceed ₹ 2,50,000/-. Nil 2 Where the total income exceeds ₹ 2,50,000/- but does not exceed ₹ 5,00,000/-. 5 per cent of the amount by which the total income exceeds ₹ 2,50,000/- 3 Where the total income exceeds ₹ 5,00,000/- but does not exceed ₹ 10,00,000/-. ₹ 12,500/- plus 20 per cent of the amount by which the total income exceeds ₹ 5,00,000/-. 4 Where the total income exceeds ₹ 10,00,000/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act,- (a) having a total income (including the income under the provisions of section 111A and section 112A ) exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such income-tax; (b) having a total income income (including the income under the provisions of section 111A and section 112A ) exceeding one crore rupees but not exceeding two crore rupees, at the rate of fifteen per cent. of such income-tax; (c) having a total income ( excluding the income under the provisions of section 111A and 112A ) exceeding two crore rupees but not exceeding five crore rupees, at the rate of twenty-five per cent. of such income-tax; and (d) having a total income (excluding the income under the provisions of section 111A and 112A ) exceeding five crore rupees, at the rate of thirty-seven per cent of such income-tax: (e) having a total income (including income under the provisions of section 111A and 112A ) exceeding two crores rupees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adhaar number, as the case may be, as per sec 206AA of the Act, and shall be deducted at the time of each payment. 1 [ No tax, however, will be required to be deducted at source in a case unless the estimated salary income including the value of perquisites is taxable after giving effect to the exemptions, deductions and relief as applicable. ] (Some typical illustrations of computation of tax are given at Annexure-I ). 3.2 Payment of Tax on Perquisites by Employer: An option has been given to the employer to pay the tax on non-monetary perquisites given to an employee. The employer may, at its option, make payment of the tax on such perquisites himself without making any TDS from the salary of the employee. However, the employer will have to pay the tax at the time when such tax was otherwise deductible i.e. at the time of payment of income chargeable under the head salaries to the employee. 3.2.1 Computation of Average Income Tax: For the purpose of making the payment of tax mentioned in para 3.2 above, tax is to be determined at the average of income tax computed on the basis of rate in force for the financial year, on the income chargea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m No. 10E duly verified by him , and thereupon the person responsible, as aforesaid, shall compute the relief on the basis of such particulars and take the same into account in making the deduction under Para (3.1) above. Further, such assessee shall upload the aforesaid Form 10E electronically in the e-Filing portal along with the return of income. Here university means a university established or incorporated by or under a Central, State or Provincial Act, and includes an institution declared under Section 3 of the University Grants Commission Act, 1956 to be a university for the purpose of that Act. 3.4.2 With effect from 1/04/2010 (AY 2010-11), no such relief shall be granted in respect of any amount received or receivable by an assessee on his voluntary retirement or termination of his service, in accordance with any scheme or schemes of voluntary retirement or in the case of a public sector company referred to in section 10(10C)(i) (read with Rule 2BA), a scheme of voluntary separation, if an exemption in respect of any amount received or receivable on such voluntary retirement or termination of his service or voluntary separation has been claimed by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al for Computation of Income From House Property [Section 24(b)]: Section 24(b) of the Act allows deduction from income from houses property on interest on borrowed capital as under:- (i) the deduction is allowed only in case of house property which is owned and is in the occupation of the employee for his own residence. However, if it is actually not occupied by the employee in view of his place of the employment being at other place, his residence in that other place should not be in a building belonging to him. (ii) the quantum of deduction allowed as per table below: Sl No Purpose of borrowing capital Date of borrowing capital Maximum Deduction Allowable 1 Repair or renewal or reconstruction of the house Any time ₹ 30,000/- 2 Acquisition or construction of the house Before 01.04.1999 ₹ 30,000/- 3 Acquisition or construction of the house On or after 01.04.1999 ₹ 1, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legraphic transfer buying rate of such currency as on the date on which tax is required to be deducted at source ( see Rule 26). 4. PERSONS RESPONSIBLE FOR DEDUCTING TAX AND THEIR DUTIES: 4.1. As per section 204(i) of the Act, in the context of payments other than payments by the Central Government or the State Government the person responsible for paying for the purpose of Section 192 means the employer himself or if the employer is a Company, the Company itself including the Principal Officer thereof. Further, as per Section 204(iv), in case the credit, or as the case may be, the payment is made by or on behalf of Central Government or State Government, the DDO or any other person by whatever name called, responsible for crediting, or as the case may be, paying such sum is the person responsible for paying for the purpose of Section 192 . 4.2. The tax determined as per para 9 should be deducted from the salary u/s 192 of the Act. 4.3. Deduction of Tax at Lower Rate : If the jurisdictional TDS officer of the employer issues a certificate of No Deduction or Lower Deduction of Tax under section 197 of the Act, in response to the applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mode of Payment of TDS 4.4.2.1 Compulsory filing of Statement by PAO, Treasury Officer, etc in case of payment of TDS by Book Entry u/ s 200 (2A) : In the case of an office of the Government, where tax has been paid to the credit of the Central Government without the production of a challan [ Book Entry ], the Pay and Accounts Officer or the Treasury Officer or the Cheque Drawing and Disbursing Officer or any other person by whatever name called to whom the deductor reports about the tax deducted and who is responsible for crediting such sum to the credit of the Central Government, shall‐ (a) submit a statement in Form No. 24G under section 200 (2A) on or before the 30 th day of April where statement relates to the month of March; and in any other case, on or before 15 days from the end of relevant month to the agency authorized by the Director General of Income‐tax (Systems) [TIN Facilitation Centres currently managed by M/s National Securities Depository Ltd] in respect of tax deducted by the deductors and reported to him for that month; and (b) intimate the number (hereinafter referred to as the Book Identification Number or BIN) generat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the tax to the credit of the Central Government within the prescribed time, he shall be liable to action in accordance with the provisions of section 201 and shall be deemed to be an assessee-in-default in respect of such tax and liable for penal action u/s 221 of the Act. Further Section 201(1A) provides that such person shall be liable to pay simple interest (i) at the rate of 1% for every month or part of the month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted; and (ii) at the rate of one and one-half percent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid. Such interest, if chargeable, is mandatory in nature and has to be paid before furnishing of quarterly statement of TDS for respective quarter. 4.5.2 Section 271C inter alia lays down that if any person fails to deduct whole or any part of tax at source or fails to pay the whole or part of tax under the second proviso to section 194B, he shall be liable to pay, by way of penalty , a sum equal to the amount of tax not deducted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue to the deductee after due authentication and verification along with the Part A of the Form No. 16. It may be noted that under the new TDS procedure, TAN of deductee/ PAN or Aadhaar number, as the case may be,of the deductee and receipt number of TDS statement filed by the deductor act as unique identifier for granting online credit of TDS to the decutee. Hence due care should be taken in filling these particulars. Due care should also be taken in indicating correct CIN/ BIN in TDS statement. If the DDO fails to issue these certificates to the person concerned, as required by section 203, he will be liable to pay, by way of penalty, under section 272A(2)(g), a sum which shall be ₹ 100/- for every day during which the failure continues. It is, however, clarified that there is no obligation to issue the TDS certificate in case tax at source is not deductible/deducted by virtue of claims of exemptions and deductions. [Note: TRACES is a web-based application of the Income tax Department that provides an interface to all stakeholders associated with TDS administration. It enables viewing of challan status, downloading of NSDL Conso File, Justification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r during the year, each of the employers shall issue Part A of the certificate in Form No. 16 pertaining to the period for which such assessee was employed with each of the employers and Part B may be issued by each of the employers or the last employer at the option of the assessee. 4.6.3. Authentication by Digital Signatures : (i) Where a certificate is to be furnished in Form No. 16, the deductor may, at his option, use digital signatures to authenticate such certificates. (ii) In case of certificates issued under clause (i), the deductor shall ensure that a) the conditions prescribed in para 4.6.1 above are complied with; b) once the certificate is digitally signed, the contents of the certificates are not amenable to change; and c) the certificates have a control number and a log of such certificates is maintained by the deductor. The digital signature is being used to authenticate most of the e-transactions on the internet as transmission of information using digital signature is failsafe. It saves time specially in organisations having large number of employees where issuance of certificate of deduction of tax with manual signature i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for set-off of loss) under the section 192(2D) : DDOs have been authorized u/s 192 to allow certain deductions, exemptions or allowances or set-off of certain loss as per the provisions of the Act for the purpose of estimating the income of the assessee or computing the amount of tax deductible under the said section. The evidence /proof /particulars for some of the deductions/exemptions/allowances/set-off of loss claimed by the employee such as rent receipt for claiming deduction in HRA, evidence of interest payments for claiming loss from self-occupied house property, etc. is not available to the DDO. To bring certainty and uniformity in this matter, section 192(2D) provides that person responsible for paying (DDOs) shall obtain from the assessee evidence or proof or particular of claims such as House rent Allowance (where aggregate annual rent exceeds one lakh rupees); Leave Travel Concession or Assistance; Deduction of interest under the head ―Income from house property‖ and deduction under Chapter VI-A as per the prescribed form 12BB laid down by Rule 26C of the Rules. Form 12BB is enclosed as Annexure IIa. 4.7 Mandatory Quoting of PAN or Aadha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in force; or iii) at the rate of twenty per cent. The deductor has to determine the tax amount in all the three conditions and apply the higher rate of TDS. However, where the income of the employee computed for TDS u/s 192 is below taxable limit, no tax will be deducted . But where the income of the employee computed for TDS u/s 192 is above taxable limit, the deductor will calculate the average rate of income- tax based on rates in force as provided in sec 192 . If the tax so calculated is below 20%, deduction of tax will be made at the rate of 20% and in case the average rate exceeds 20%, tax is to be deducted at the average rate. Health and Education cess @ 4% is not to be deducted, in case the tax is deducted at 20% u/s 206AA of the Act. 4.9 Statement of deduction of tax under section 200(3) [Quarterly Statement of TDS]: 4.9.1 The person deducting the tax (employer in case of salary income), is required to file duly verified Quarterly Statements of TDS in Form 24Q for the periods [details in Table below] of each financial year, to the TIN Facilitation Centres authorized by DGIT (System's) which is currently managed by M/s National Secu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h fee shall not exceed the amount of tax which was deductible at source. This fee is mandatory in nature and to be paid before furnishing of such statement. 4.9.5 Rectification of mistake in filing TDS Statement: A DDO can also file a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered earlier. 4.9.6 Penalty for failure in furnishing statements or furnishing incorrect information (section 271H): If a person fails to deliver or caused to be delivered a statement within the time prescribed in section 200(3) or furnishes an incorrect statement, in respect of tax deducted at source [on or after 1.07.2012], he shall be liable to pay, by way of penalty a sum which shall not be less than ₹ 10,000/- but which may extend to ₹ 1,00,000/-. However, the penalty shall not be levied if the person proves that after paying TDS with the fee and interest, if any, to the credit of Central Government, he had delivered such statement before the expiry of one year from the time prescribed for delivering the statement. 4.9.7 At the time of preparing statements of tax deduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 707 dated 11.07.1995]. 4.11.2 In respect of non-residents, the salary paid for services rendered in India shall be regarded as income earned in India. It has been specifically provided in the Act that any salary payable for rest period or leave period which is both preceded or succeeded by service in India and forms part of the service contract of employment will also be regarded as income earned in India. 5. COMPUTATION OF INCOME UNDER THE HEAD SALARIES 5.1 INCOME CHARGEABLE UNDER THE HEAD SALARIES : (1) The following income shall be chargeable to income-tax under the head Salaries : (a) any salary due from an employer or a former employer to an assessee in the previous year, whether paid or not; (b) any salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer though not due or before it became due to him. (c) any arrears of salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer, if not charged to income-tax for any earlier previous year. (2) For the removal of doubts, it is clarified that where any salary paid in advance is includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vided free of cost or at concessional rate in any of the following cases: i) By a company to an employee who is a director of such company; ii) By a company to an employee who has a substantial interest in the company; iii) By an employer (including a company) to an employee, who is not covered by (i) or (ii) above and whose income under the head Salaries (whether due from or paid or allowed by one or more employers), exclusive of the value of all benefits and amenities not provided by way of monetary payment, exceeds ₹ 50,000/-. [What constitutes concession in the matter of rent have been prescribed in Explanations 1 to 4 below section 17(2)(ii) of the Act] IV. Any sum paid by the employer in respect of any obligation which would otherwise have been payable by the assessee. V. Any sum payable by the employer, whether directly or through a fund, other than a recognized provident fund or an approved superannuation fund or other specified funds u/s 17, to effect an assurance on the life of an assessee or to effect a contract for an annuity. VI. The value of any specified security or sweat equity shares allotted or transferred , directly or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subsidiaries, Universities, etc. are not covered under this method of valuation. (ii) For all others, i.e., those salaried taxpayers not in employment of the Central government and the State government, the valuation of perquisite in respect of accommodation would be at prescribed rates, as discussed below: a) Where the accommodation provided to the employee is owned by the employer : Sl No Cities having population as per the 2001 census Perquisite 1 Exceeds 25 lakh 15% of salary 2 Exceeds 10 lakhs but does not exceed 25 lakhs 10% of salary 3 For other places 7.5 % of salary b) Where the accommodation so provided is taken on lease/ rent by the employer: The prescribed rate is 15% of the salary or the actual amount of lease rental payable by the employer, whichever is lower, as reduced by any amount of rent paid by the employee. Meaning of Salary for the purpose of calculation of perquisite in respect of Residential Accommod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing two conditions are satisfied: 1. The hotel accommodation is provided for a total period not exceeding in aggregate 15 days in a previous year, and 2. Such accommodation is provided on an employee s transfer from one place to another place. It may be clarified that while services provided as an integral part of the accommodation, need not be valued separately as perquisite, any other services over and above that for which the employer makes payment or reimburses the employee shall be valued as a perquisite as per the residual clause. In other words, composite tariff for accommodation will be valued as per the Rules and any other charges for other facilities provided by the hotel will be separately valued under the residual clause. D. However, the value of any accommodation provided to an employee working at a mining site or an on-shore oil exploration site or a project execution site or a dam site or a power generation site or an off-shore site will not be treated as a perquisite if: (i) such accommodation is located in a ―remote area or (ii) where it is not located in a ―remote area , the accommodation is of a temporary nature hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otor car exceeds 1.6 litres. If the motor car or any other automotive conveyance is owned by the employee but the actual running and maintenance charges are met or reimbursed by the employer, the method of valuation of perquisite value is different and as below: a) where the motor car or any other automotive conveyance is owned by the employee but actual maintenance running expenses (including chauffeur salary, if any) are met or reimbursed by the employer, no perquisite shall be chargeable to tax if the car is used wholly and exclusively for official purposes. However following compliances are necessary: The employer has maintained complete details of the journey undertaken for official purposes; The employer gives a certificate that the expenditure was incurred wholly for official duties. However if the motor car is used partly for official or partly for private purposes then the amount of perquisite shall be the actual expenditure incurred by the employer as reduced by the amounts in c) referred to in (1) above. Normal wear and tear of the motor shall be taken at 10 % per annum of the actual cost of the motor car. III Personal attendants et ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enity. This will not apply to the employees of any airline or the railways. VII Interest free or concessional loans [Rule 3(7)(i)] : It is common practice, particularly in financial institutions, to provide interest free or concessional loans to employees or any member of his household. The value of perquisite arising from such loans would be the excess of interest payable at prescribed interest rate over interest, if any, actually paid by the employee or any member of his household. The prescribed interest rate would now be the rate charged per annum by the State Bank of India as on the 1 st day of the relevant financial year in respect of loans of same type and for the same purpose advanced by it to the general public . Perquisite value would be calculated on the basis of the maximum outstanding monthly balance method. For valuing perquisites under this rule, any other method of calculation and adjustment otherwise adopted by the employer shall not be relevant. However, small loans up to ₹ 20,000/- in the aggregate are exempt. Loans for medical treatment of diseases specified in Rule 3A are also exempt, provided the amount of loan for medical reimbu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... beverages provided in working hours in remote area or in an offshore installation. X Gifts [Rule 3(7)(iv)]: The value of any gift or vouchers or token in lieu of which such gift may be received, given by the employer to the employee or member of his household, is taxable as perquisite. However gift, etc less than ₹ 5,000 in aggregate per annum would be exempt. XI Membership fees and Annual Fees [Rule 3(7)(v)] : Any membership fees and annual fees incurred by the employee (or any member of his household), which is charged to a credit card (including any add-on card) provided by the employer, or otherwise, paid for or reimbursed by the employer is taxable on the following basis: Amount of expenditure incurred by the employer XXX Less : Expenditure on use for official purposes XXX Less : Amount, if any, recovered from the employee XXX XXX Amount taxable as perquisite XXX However if the amount is incurred wholly and exclusively for official purposes it will be exempt if t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the employer. The difference between the original cost of the movable asset (not being shares or securities) and the sum, if any, paid by the employee, shall be taken as the value of perquisite. In case of a movable asset, which has already been put to use, the original cost shall be reduced by a sum of 10% of such original cost for every completed year of use of the asset. Owing to a higher degree of obsolescence, in case of computers and electronic gadgets, however, the value of perquisite shall be worked out by reducing 50% of the actual cost by the reducing balance method for each completed year of use. Electronic gadgets in this case means data storage and handling devices like computer, digital diaries and printers. They do not include household appliance (i.e. white goods) like washing machines, microwave ovens, mixers, hot plates, ovens etc. Similarly, in case of cars, the value of perquisite shall be worked out by reducing 20% of its actual cost by the reducing balance method for each completed year of use. XV Medical Reimbursement by the employer As per the amendment vide Finance Act, 2018, the total amount of medical re-imbursement is to be taken as perquisite u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penses actually incurred for the purpose of such travel. As discussed in para 4.6.5 section 192 (2D) read with the rule 26C makes it mandatory for the DDO to obtain details/evidence in respect of claim of exemption for leave travel concession or assistance before allowing the said exemption the relevant form for furnishing details by employee is Form 12BB 5.3.2 Death-cum-retirement gratuity or any other gratuity is exempt to the extent specified from inclusion in computing the total income under Section 10(10). Any death- cum -retirement gratuity received under the revised Pension Rules of the Central Government or, as the case may be, the Central Civil Services (Pension) Rules, 1972, or under any similar scheme applicable to the members of the civil services of the Union or holders of posts connected with defence or of civil posts under the Union (such members or holders being persons not governed by the said Rules) or to the members of the all-India services or to the members of the civil services of a State or holders of civil posts under a State or to the employees of a local authority or any payment of retiring gratuity received under the Pension Code or Regulations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount not less than ₹ 50,000/- as the Central Government may by notification specify in the Official Gazette, whichever is less. These limits shall not apply in the case where the compensation is paid under any scheme which is approved in this behalf by the Central Government, having regard to the need for extending special protection to the workmen in the undertaking to which the scheme applies and other relevant circumstances. The maximum limit of such payment is ₹ 5,00,000/- where retrenchment is on or after 1.1.1997 as specified in Notification No. 10969 dated 25-06-1999. 5.3.6 Under Section 10(10C), any payment received or receivable (even if received in installments) by an employee of the following bodies at the time of his voluntary retirement or termination of his service, in accordance with any scheme or schemes of voluntary retirement or in the case of public sector company, a scheme of voluntary separation , is exempt from income-tax to the extent that such amount does not exceed ₹ 5,00,000/-: a) A public sector company; b) Any other company; c) An Authority established under a Central, State or Provincial Act; d) A Local Authority; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (12A) of the Act, any payment from the National Pension System Trust to an assessee on closure of his account or on his opting out of the pension scheme referred to in section 80CCD to the extent it does not exceed sixty percent from financial year 2019-20[ as amended by Finance (NO.2 ) Act, 2019] , of the total amount payable to him at the time such closure of his opting out of the scheme shall be exempt. Under section 10 (12B) of the Act, any payment from the National Pension System Trust to an employee under the pension scheme referred to in section 80CCD, on partial withdrawal made out of his account in accordance with the terms and conditions, specified under the Pension Fund regulatory and Development Authority Act, 2013 and the regulation made thereunder, to the extent it does not exceed twenty-five percent of the amount of contribution made by him shall be exempt. 5.3.8 Any payment from a Provident Fund to which the Provident Funds Act, 1925, applies or from any other provident fund set up by the Central Government and notified by it in the Official Gazette is exempt under section 10(11). 5.3.9 Under section 10(13A ) of the Act, any special allowance spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the performance of his duties as prescribed under Rule 2BB subject to the extent to which such expenses are actually incurred for that purpose. (ii) Any allowance granted to an employee either to meet his personal expenses at the place of his posting or at the place he ordinarily resides or to compensate him for the increased cost of living , which may be prescribed and to the extent as may be prescribed. However, the allowance referred to in (ii) above should not be in the nature of a personal allowance granted to the assessee to remunerate or compensate him for performing duties of a special nature relating to his office or employment unless such allowance is related to his place of posting or residence. It is further clarified that any allowance granted to an employee which is not exempted under section 10(14) read with rule 2BB or the sum of allowance exceeding the amount prescribed under rule shall be chargeable to tax under the head income from salary. For example no exemption is provided in rule 2BB for the training allowance paid for the posting in any training institute hence whole of the training allowance shall be included in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ical treatment provided to an employee or any member of his family, in any hospital maintained by the employer; (b) any sum paid by the employer in respect of any expenditure actually incurred by the employee on his medical treatment or of any member of his family: (i) in any hospital maintained by the Government or any local authority or any other hospital approved by the Government for the purposes of medical treatment of its employees; ( ii) in respect of the prescribed diseases or ailments as provided in Rule 3A(2) of the Rules in any hospital approved by the Chief Commissioner having regard to the prescribed guidelines as provided in Rule 3(A)(1)of the Rules, (c) premium paid by the employer in respect of medical insurance taken for his employees (under any scheme approved by the Central Government or Insurance Regulatory and Development Authority) or reimbursement of insurance premium to the employees who take medical insurance for themselves or for their family members (under any scheme approved by the Central Government or Insurance Regulatory and Development Authority); (d) As regards medical treatment abroad, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fifth of his salary(exclusive of any allowance, benefit or other perquisite) or five thousand rupees whichever is less. No deduction on account of entertainment allowance is available to non- government employees. 5.4.3 Tax on Employment [Section 16(iii)]: The tax on employment (Professional Tax) within the meaning of article 276(2) of the Constitution of India, leviable by or under any law, shall also be allowed as a deduction in computing the income under the head Salaries . 5.5 DEDUCTIONS UNDER CHAPTER VI-A OF THE ACT In computing the taxable income of the employee, the following deductions under Chapter VI-A of the Act are to be allowed from his gross total income: 5.5.1 Deduction in respect of Life insurance premia, deferred annuity, contributions to provident fund, subscription to certain equity shares or debentures, etc. (section 80C) A. Section 80C , entitles an employee to deductions for the whole of amounts paid or deposited in the current financial year in the following schemes, subject to a limit of ₹ 1,50,000/ -: (1) Payment of insurance premium to effect or to keep i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment has since notified National Saving Certificate (VIIIth Issue) vide Notification S.O. No. 1560(E) dated 3.11.05 and National Saving Certificate (IXth Issue) vide Notification . G.S.R. 848 (E), dated the 29th November, 2011, publishing the National Savings Certificates (IX- Issue) Rules, 2011 G.S.R. 868 (E), dated the 7th December, 2011, specifying the National Savings Certificates IX Issue as the class of Savings Certificates F No1-13/2011-NS-II r/w amendment Notification No.GSR 319(E), dated 25-4-2012] (6) Any sum paid as contribution in the case of an individual, for himself, spouse or any child, a. for participation in the Unit Linked Insurance Plan, 1971 of the Unit Trust of India; b. for participation in any unit-linked insurance plan of the LIC Mutual Fund referred to section 10 (23D) and as notified by the Central Government. [The Central Government has since notified Unit Linked Insurance Plan (formerly known as Dhanraksha, 1989) of LIC Mutual Fund vide Notification S.O. No. 1561(E) dated 3.11.05.] (7) Any subscription made to effect or keep in force a contract for such annuity plan of the Life Insurance C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both. [The Central Government has since notified the Public Deposit Scheme of HUDCO vide Notification S.O. No.37(E), dated 11.01.2007, for the purposes of Section 80C(2)(xvi)(a)]. (12) Any sums paid by an assessee for the purpose of purchase or construction of a residential house property, the income from which is chargeable to tax under the head Income from house property (or which would, if it has not been used for assessee's own residence, have been chargeable to tax under that head) where such payments are made towards or by way of any installment or part payment of the amount due under any self- financing or other scheme of any Development Authority, Housing Board etc. The deduction will also be allowable in respect of re-payment of loans borrowed by an assessee from the Government, or any bank or Life Insurance Corporation, or National Housing Bank, or certain other categories of institutions engaged in the business of providing long term finance for construction or purchase of houses in India. Any repayment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified that the amount allowable as tuition fees shall include any payment of fee to any university, college, school or other educational institution in India except the amount representing payment in the nature of development fees or donation or capitation fees or payment of similar nature. (14) Subscription to equity shares or debentures forming part of any eligible issue of capital made by a public company, which is approved by the Board or by any public finance institution. (15) Subscription to any units of any mutual fund referred to in clause (23D) of Section 10 and approved by the Board, if the amount of subscription to such units is subscribed only in eligible issue of capital of any company. (16) Investment as a term deposit for a fixed period of not less than five years with a scheduled bank, which is in accordance with a scheme framed and notified by the Central Government, in the Official Gazette for these purposes. [The Central Government has since notified the Bank Term Deposit Scheme, 2006 for this purpose vide Notification S.O. No. 1220(E) dated 28.7.2006] (17) Subscription to such bonds issued by the Nati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC allows an employee deduction of an amount paid or deposited out of his income chargeable to tax to effect or keep in force a contract for any annuity plan of Life Insurance Corporation of India or any other insurer for receiving pension from the Fund referred to in section 10(23AAB). However, the deduction shall exclude interest or bonus accrued or credited to the employee's account, if any and shall not exceed ₹ 1,50,000.However, if any amount is standing to the credit of the employee in the fund referred to above and deduction has been allowed as stated above and the employee or his nominee receives this amount together with the interest or bonus accrued or credited to this account due to the reason of (i) Surrender of annuity plan whether in whole or part (ii) Pension received from the annuity plan then the amount so received during the Financial Year shall be the income of the employee or his nominee for that Financial Year and accordingly will be charged to tax. Where any amount paid or deposited by the employee has been taken into account for the purposes of this section, a deduction with reference to such amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ominee for that Financial Year and accordingly will be charged to tax. Further, the amount received by the nominee, on the death of the assessee, on closure or opening of the pension not be deemed to be the income of the nominee.Where any amount paid or deposited by the employee has been taken into account for the purposes of this section, a deduction with reference to such amount shall not be allowed under section 80C. Further, it has been specified that w.e.f 01.04.09 any amount received by the employee from the New Pension Scheme shall be deemed not to have been received in the previous year if such amount is used for purchasing an annuity plan in the same previous year. It is emphasized that as per the s ection 80CCE the aggregate amount of deduction under sections 80C, 80CCC and Section 80CCD(1) shall not exceed ₹ 1,50,000/-. The deduction allowed under section 80 CCD(1B) is an additional deduction in respect of any amount paid in the NPS upto ₹ 50,000/-. However, the contribution made by the Central Government or any other employer to a pension scheme u/s 80CCD(2) shall be excluded from the limit of ₹ 1,50,000/- provided u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Particulars Case-1 Case-2 Case-3 Self Family ( no one of them is a senior citizen ) Parents (no one of them is a senior citizen) Self Family (no one of them is a senior citizen) Parents (atleast one of them is a senior citizen) Self Family (atleast one of them is a senior citizen) Parents (atleast one of them is a senior citizen) Medical Insurance, etc.* 25,000 25,000 25,000 50,000 50,000 50,000 Medical Expenditure** -- -- -- 50,000 50,000 50,000 Maximum deduction allowable 25,000 25,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disability 5.5.6.1 Deductions in respect of maintenance including medical treatment of a dependent who is a person with disability (section 80DD): Under section 80DD , where an employee, who is a resident in India, has, during the previous year- (a) incurred any expenditure for the medical treatment (including nursing), training and rehabilitation of a dependant, being a person with disability ; or (b) paid or deposited any amount under a scheme framed in this behalf by the Life Insurance Corporation or any other insurer or the Administrator or the specified company subject to the conditions specified in this regard and approved by the Board in this behalf for the maintenance of a dependant, being a person with disability, the employee shall be allowed a deduction of a sum of ₹ 75,000 /- from his gross total income of that year. However, where such dependant is a person with severe disability, an amount ₹ 1,25,000/- shall be allowed as deduction subject to the specified conditions. The deduction under (b) above shall be allowed only if the following conditions are fulfilled:- (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) ―Administrator‖ means the Administrator as referred to in clause (a) of section 2 of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 ; (b) ―dependant‖ means- (i) in the case of an individual, the spouse, children, parents, brothers and sisters of the individual or any of them; (ii) in the case of a Hindu undivided family, a member of the Hindu undivided family, dependant wholly or mainly on such individual or Hindu undivided family for his support and maintenance, and who has not claimed any deduction under section 80U in computing his total income for the assessment year relating to the previous year; (c) ―disability‖ shall have the meaning assigned to it in clause (i) of section 2 of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 and includes ―autism‖, ―cerebral palsy‖ and ―multiple disability‖ referred to in clauses (a), (c) and (h) of section 2 of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yee or his dependant or ₹ 40,000 whichever is less. Now the deduction can be allowed on the basis of a prescription from an oncologist, a urologist, nephrologist, a haematologist, an immunologist or such other specialist, as mentioned in Rule 11DD. However, the amount of the claim shall be reduced by the amount if any received from the insurer or reimbursed by the employer. Further in case of the person against whom such claim is made is a senior citizen (60 age years or more) then the deduction up to one lakh rupees is allowed For the purpose of this section, in the case of an employee, dependant means individual, the spouse, children, parents, brothers and sisters of the employee or any of them, dependant wholly or mainly on the employee for his support and maintenance. Vide Notification SO No. 2791(E) dated 12.10.2015, Rules 11DD has been amended to do away with the requirement of furnishing a certificate in Form 10-I. A prescription from a specialist as specified in the Rules containing the name and age the patient, name of the disease/ailment along with the name, address, registration number qualification of the specialist issuing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding on the 31st day of March, 2020; (ii) the stamp duty value of residential house property does not exceed forty-five lakh rupees; (iii) the assessee does not own any residential house property on the date of sanction of loan. For the purposes of this section,- (a) the expression financial institution shall have the meaning assigned to it in clause (a) of sub-section (5) of section 80EE; (b) the expression stamp duty value means value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property. The amount of this deduction shall not exceed ₹ 1,50,000/- and it shall be allowed in computing the total income of the individual for the assessment year 2020-21 and subsequent assessment years. Where a deduction under this section is allowed for any interest referred to in this section, no deduction shall be allowed in respect of such interest under any other provision of this Act for the same or any other assessment year. 5.5.10 80EEB Section 80EEB intr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clarified that the claim in respect of such donations as indicated above will be admissible under section 80G on the basis of the certificate issued by the Drawing and Disbursing Officer (DDO)/Employer in this behalf - Circular No. 2/2005, dated 12-1-2005. No deduction under this section is allowable in case the amount of donation exceeds ₹ 2000/- unless the amount is paid by any mode other than cash. 5.5.12 Deductions is respect of rents paid (Section 80GG): Section 80GG allows the employee to a deduction in respect of house rent paid by him for his own residence . Such deduction is permissible subject to the following conditions :- (a) the employee has not been in receipt of any House Rent Allowance specifically granted to him which qualifies for exemption under section 10(13A) of the Act; (b) the employee files the declaration in Form No.10BA. (Annexure X) (c) The employee does not own: (i) any residential accommodation himself or by his spouse or minor child or where such employee is a member of a Hindu Undivided Family, by such family, at the place where he ordinarily resides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Rule 6AAA 4 an association or institution which has as its object the training of persons for implementing programmes of rural development. furnishes the certificate u/s 35CCA (2A) Prescribed Authority under Rule 6AAA 5 a public sector company or a local authority or to an association or institution approved by the National Committee, for carrying out any eligible project or scheme. furnishes the certificate u/s 35AC(2)(a) National Committee for Promotion of Social Economic Welfare 7 a rural development fund notified u/s 35CCA (1)(c) set up and notified by the Central Government 8 National Urban Poverty Eradication Fund notified u/s 35CCA (1)(d) set up and notified by the Central Government No deduction under this section is allowable in case: i) The employee has gross total income which includes income which is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative society engaged in carrying on the business of banking (including a co-operative land mortgage bank or a co-operative land development bank); or (c) a Post Office as defined in clause (k) of section 2 of the Indian Post Office Act, 1898. The amount of deduction in respect of above interest on deposit is as under:- (i) in a case where the amount of such income does not exceed in the aggregate fifty thousand rupees, the whole of such amount; and (ii) in any other case, fifty thousand rupees. However, no deduction is allowed under section 80TTB to any partner of the firm or any member of the association or any individual of the body if said interest is derived from any deposit held by, or on behalf of, a firm, an association of persons or a body of individuals. For this purpose, ―senior citizen―means an individual resident in India who is of the age of sixty years or more at any time during the relevant previous year. However, taxpayers claiming deduction under section 80TTB shall not be eligible for deduction under section 80TTA. 6. REBATE OF ₹ 12500 FOR INDIVIDUAL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated balance due to the employee, deduct income tax thereon @ 10% if the amount of such payment or aggregate of such payment exceeds ₹ 50,000/-. In case the employee does not provide his/her PAN or Aadhaar number as the case may be , or provides an invalid PAN or Aadhaar number as the case may be , then the deduction will have to be made at maximum marginal rate. The Rule-8 of Part-A of fourth schedule excludes the following accumulated balance due and becoming payable to the employee from the total income; (i) If, he has rendered continuous service with his employer for a period of five years or more, or (ii) If, though he has not rendered such continuous service, the service has been terminated by reason of - the employees ill health, or by the contraction or discontinuance of the employer's business or other cause beyond the control of employee, or (iii) if, on cessation of his employment, the employee obtains employment with any other employer, to the extent amount of such accumulated balance is transferred to his individual account in any recognized provident fund maintaine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay be remembered that no loss under any such head is allowable by DDO other than loss under the Head ―Income from House property‖ to the extent of ₹ 2.00 lakh. d) Allow deductions mentioned in para 5.5 from the figure arrived at (c) above ensuring that the relevant conditions are satisfied. The aggregate of the deductions subject to the threshold limits mentioned in para 5.5 shall not exceed the amount at (b) above and if it exceeds, it should be restricted to that amount. This will be the amount of total income of the employee on which income tax would be required to be deducted. This income should be rounded off to the nearest multiple of ten rupees. 9.2 Income-tax on such income shall be calculated at the rates given in para 2.1 of this Circular keeping in view the age of the employee and subject to the provisions of sec. 206AA, as discussed in para 4.8. Rebate as per Section 87A up to ₹ 12,500/- to eligible persons (see para 6) may be given. Surcharge shall be calculated in cases where applicable (see para 2.2). 9.3 The amount of tax as increased by the surcharge if applicable so arrived at shall be incre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G.P.F. 45,000 50,000 1,00,000 1,00,000 1,00,000 Computation of Total Income and tax payable thereon Particulars Rupees (i) Rupees (ii) Rupees (iii) Rupees (iv) Rupees (v) Gross Salary 2,50,000 6,00,000 10,50,000 55,50,000 1,10,50,000 Less: Standard deduction u/s 16(ia) 50000 50000 50000 50000 50000 Less: Deduction U/s 80C 45,000 50,000 1,00,000 1,00,000 1,00,000 Taxable Income 1,55,000 5,00,000 9,00,000 54,00,000 1,09,00,000 (A) Tax Thereon Nil Nil* 92,500 14,3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 Less: Deduction u/s 80TTA on Interest Income on savings account (restricted to ₹ 10000/-) 10000 8 Total Income 2,97,000 9 Income Tax thereon/payable (includes Rebate of ₹ 12500 as per Section 87A) Nil 10 Add: Health Education Cess @ 4%. Nil 11 Total Income Tax payable Nil 12 Rounded off to Nil @ or Aadhaar number, as the case may be, Example 3 For Assessment Year 2020-21 Calculation of Income Tax in the case of an employee below age of sixty years where medical treatment expenditure was borne by the employer (With valid PAN@ furnished to employer). S.No. Particulars Rupees 1 Gross Salary 5,55,000 2 Medical Reimbursement by employer on the treatment of self and depen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 Total Income 4,05,000 8 Income Tax thereon/payable (includes Rebate of ₹ 12500 as per Section 87A) Nil* 9 Add: Health Education Cess @ 4%. Nil 10 Total Income Tax payable Nil @ or Aadhaar number, as the case may be, Example 4 For Assessment Year 2020-21 Illustrative calculation of House Rent Allowance U/s 10 (13A) in respect of residential accommodation situated in Delhi in case of an employee below the age of sixty years (With valid PAN@ furnished to employer). S.No. Particulars Rupees 1 Salary 4,00,000 2 Dearness Allowance 2,00,000 3 House Rent Allowance 1,40,000 4 House rent paid 1,44,000 5 G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... calculation of tax in the case of an employee below age of sixty years of a private company in Mumbai who was provided accommodation in a flat at concessional rate for ten months and in a hotel for two months ( With valid PAN @furnished to employer). S.No. Particulars Rupees 1 Salary 7,50,000 2 Bonus 1,40,000 3 Free gas, electricity, water etc. (Actual bills paid by company) 40,000 4(a) Flat at concessional rate (for ten month). @ ₹ 36000/month 3,60, 000 4(b) Hotel rent paid by employer (for two month) 1,00,000 4(c) Rent recovered from employee. 60,000 4(d) Cost of furniture. 2,00,000 5 Subscription to Unit Linked Insurance Plan 50,000 6 Life Insurance Premium ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,76,600 10 Tax Payable 87,820 11 Add: Health Education Cess @ 4%. 3513 12 Total Income Tax payable 91,333 13 Rounded off to 91,330 @ or Aadhaar number, as the case may be. Example 6 For Assessment Year 2020-21 Illustrating Valuation of perquisite and calculation of tax in the case of an employee below the age of 60 years of a Private Company posted at Delhi and repaying House Building Loan (With valid PAN @furnished to employer). S.No. Particulars Rupees 1 Salary 4,50,000 2 Dearness Allowance 1,00,000 3 House Rent Allowance 1,80,000 4 Special Duties Allowance 12,000 5 Provident Fund 60,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 Income Tax thereon/payable (includes Rebate of ₹ 12500 as per Section 87A) Nil 7 Add: Health Education Cess @ 4%. Nil 8 Total Income Tax payable Nil 9 Rounded off to Nil @ or Aadhaar number, as the case may be Example 7 For Assessment Year 2020-21 A. Calculation of Income tax in the case of a retired employee above the age of sixty years but below the age of 80 years and having gross pension of: iv) ₹ 5,00,000/- v) ₹ 8,50,000/-, vi) ₹ 13,00,000/-. B What will be the amount of TDS in case of above employees, if PAN@ is not submitted by them to their DDOs/Offices: Particulars Rupees (i) Rupees (ii) Rupees (iii) Gross Pension 5,00,000 8,50,000 13,00,000 Contribution of P.P.F. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50,000 50,000 Less: Deduction U/s 80C 80,000 1,20,000 1,50,000 Taxable Income 4,20,000 6,80,000 11,00,000 Tax thereon Nil 36,000 1,30,000 Add: Health Education Cess @ 4%. Nil 1,440 5,200 Total tax payable Nil 37,440 1,35,200 @ or Aadhaar number, as the case may be. Example 9 Exemption u/s 10 (13A) 1. Mr. A, employed with XYZ Ltd. Up to 31.10.2018, received following emoluments : S.No. Particulars Rupees 1. Basic pay p.m. 13,000 2. Bonus for the year received in July, 2018 7,200 3. Club faci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Contribution to U.R.P.F. 1,07,300 (b) From PQR Ltd. Rupees Basic pay (₹ 18,000 x 5) 90,000 H.R.A. (₹ 1,600 x 5) 8,000 Less : Exempt u/s 10(13A) 8,000 Club Facility (₹ 1,100 x 5) 5,500 Facility of Car (not taxable as perquisite) 15,400 Employer s Contribution to R.P.F. 95,500 Gross Salary 2,02,800 Less: Standard deduction u/s 16(ia) 40,000 Net Salary 1,62,800 2. Income from Others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licy of ₹ 1,00,000 taken in name of his wife before 1.04.2012) 10,500 7. Contribution to Public Provident Fund 10,000 8. Repayment of HDFC loan borrowed after 1.04.1999 EMI ₹ 25,000 (Towards loan ₹ 95,000, towards interest ₹ 2,05,000) 3,00,000 Computation of Tax S.No. Particulars Rupees 1. Income from Salary Basic Pay @ ₹ 40,000 p.m (March to June 19) 1,60,000 @ ₹ 41,200 p.m * (July 2019 to Feb 2020) 3,29,600 4,89,600 Dearness Allowance 1.3.2019 to 30.06 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Deduction u/s 80 C - GPF @ ₹ 4,700/-p.m 56,400 - CGEGIS @ ₹ 500/- p.m 6,000 - Life Insurance Premium 10, 500 - Repayment of HDFC Loan 95,000 - Deposit in Public Provident Fund 10,000 1,77,900 1,50,000 Restricted to a maximum of Taxable Income 3,30,600 Computation of Tax Liability Tax payable 4,030 Less : Rebate u/s 87A 4,030 Net Income-tax payable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Credit card expenses 12 Club expenses 13 Use of movable assets by employees 14 Transfer of assets to employees 15 Value of any other benefit/amenity/service/pri vilege 16 Stock options (non- qualified options) 17 Other benefits or amenities 18 Total value of perquisites 19 Total value of Profits in lieu of salary as per 17(3) 9. Details of tax, - (a) Tax deducted from salary of the employee u/s 192(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 Leave travel concessions or assistance 3 Deduction of interest on borrowing: (i) Interest payable/paid to the lender (ii) Name of the lender (iii) Address of the lender (iv) Permanent Account Number or Aadhaar number, as the case may be, of the lender (a) Financial Institutions (if available) (b) Employer (if available) (c) Others 4 Deduction under Chapter VI-A (A) Section 80C,80CCC and 80CCD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y filing of Statement by PAO, Treasury Officer, etc. in case of payment of TDS by Book Entry. 1. Procedure of preparation and furnishing Form 24G at TIN-Facilitation Centres (TIN-FCs): The Form 24G should be prepared by the PAO/DTO/CDDO (hereinafter referred to as AOs) as per the data structure (File format) prescribed by the DIT (Systems), Delhi which is available on TIN website www.tin-nsdl.com. The AOs can prepare Form 24G either by using in-house facilities, third party software or by using form 24G Return Preparation Utility (RPU) developed by NSDL e-Governance Infrastructure Limited (NSDL), which is freely downloadable from the TIN web-site www.tin-nsdl.com . After preparation of form 24G, the AO is required to validate the same by using the Form 24G File Validation Utility (FVU) which is freely available on TIN website. Once file is validated through FVU, ‗.fvu file in CD/DVD/Pen Drive along with physical Statement Statistic Report (SSR) signed by the AO, to be furnished at TIN-FCs. On successful acceptance of Form 24G at the TIN-FC, an acknowledgement containing 15 digit Token no. is provided to the AO. The AO can view the status of Form 24G on TIN web ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modification or cancellation of Form 24G accepted at TIN Central System. Preparation and validation of correction form 24G is in line with regular form 24G. The validated Form 24G correction file (.fvu file) can be uploaded online through AO account at TIN website. For correction Form 24G accepted at TIN central system, an online acknowledgement containing a 15 digit token number is generated and displayed to the AO. The format of the acknowledgement is identical to the one issued by the TIN-FC. There is no need to submit SSR and provisional receipt of original form 24G in online upload. 3. For FAQs and further details, AOs are advised to log on TIN website www.tinnsdl.com ****** ANNEXURE IV Furnishing of Monthly Form No. 24G Statements by Pay and Accounts Officers (PAOs)/District Treasury Officers (DTOs)/Cheque Drawing and Disbursing Officers(CDDOs) 1. Under what income tax rule should Form 24G be filed? Income-tax Department Notification no. 41/2010 dated May 31, 2010 amended the Income Tax Rule 30 which mandates that in case of an office of the Government, where tax has been paid to the credit of Central Government without the production of a challa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oor, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai - 400013 recommending allotment of AIN to the PAO / CDDO / DTO. 6. What information should be submitted through Form 24G? Every AO should furnish one complete, correct and consolidated Form 24G every month having details of each type of deduction / collection separately viz. TDS-Salary / TDS-Non Salary / TDS-Non Salary Non Residents / TCS made by each DDO under his jurisdiction. 7. Where should Form 24G be submitted? Form 24G is to be furnished only in electronic form in a CD/pen drive at TIN-FCs or online through AO Account at www.tin-nsdl.com web portal. The facility to submit Form No. 24G online is available free of cost. Provisional Receipt Number (PRN) is issued as an acknowledgement of the receipt of Form 24G. 8. How to register for online facility? Registration for AO Account is mandatory for filing Form No. 24G online through TIN website, www.tin-nsdl.com . Registration AO Account is required once only. AO required to submit the Form No. 24G at TIN-FC at least once to comply with the Know Your Customer (KYC) norms for registration of the AO Account. After registration, it is opti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... receipt with a unique Provisional Receipt Number (PRN) to the AO as a proof of submission of the statement. 14. What is Form 24G Preparation Utility? The Form 24G Preparation Utility is a Java based utility. Form 24G Preparation Utility can be freely downloaded from www.tin-nsdl.com . After downloading, it needs to be saved on the local disk of the machine. JRE (Java Run-time Environment) [versions: SUN JRE: 1.4.2_02 or 1.4.2_03 or 1.4.2_04 or IBM JRE: 1.4.1.0] should be installed on the computer where Form 24G Preparation Utility is being installed. JRE is freely downloadable from http://java.sun.com and http://www.ibm.com/developerworks/java/jdk or you can ask your computer vendor (hardware) to install the same for you. Form 24G Preparation Utility can be executed on Windows platform(s) Win 2K Prof. / Win 2K Server/ Win NT 4.0 Server/ Win XP Prof. To run the ‗Form 24G Preparation Utility , click on the ‗24GRPU.bat file. If JRE is not installed on the computer, then on clicking ‗24GRPU.bat , a message will be displayed. In such cases, install JRE and try again. If appropriate version of JRE is installed, then the ‗Form 24G Preparatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame should be accompanied with the Statement Statistic Report mentioned at Sr. No. (b), in paper form duly signed by the Accounts Officer, which needs to be submitted at TIN-FCs. Form 24G: Form 24G, at serial number (c) above, is a reader friendly format of TDS/TCS Book Adjustment form. This is like the physical form of Form 24G in html format. It contains all the details of Accounts Officer as well as Drawing and Disbursement Officer. There is no need to submit this file. 18. Can the Form 24G Statement be corrected? Every Form 24G is to be prepared in accordance with the data structure prescribed by the Income Tax Department (ITD). If it does not confirm to the new data structure it will be rejected by TIN. As per procedure, statements relating to Form 24G should be complete and correct. No fragmented statements are expected to be filed (i.e. separate statements giving details for deductions under different form type with respect to the same AIN, FY and month). However, any mistake made in an original accepted statement can be rectified by submitting a ‗correction statement . For correction, the latest version of the RPU should be downloaded from TIN websit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will allow AOs to file regular Form 24G for the same primary key (AIN, Financial year and Month). This type of correction is to be filed only if the Form 24G has been filed with wrong AIN, F.Y. or Month. 22. What is BIN? BIN stands for ―Book Identification Numberǁ for each form type mentioned in the accepted monthly form No. 24G. BIN consists of the following: (i) Receipt Number : Receipt number is a seven digit unique number generated on successful acceptance of Form 24G. (ii) DDO Serial Number: It is a five digit unique number generated for every DDO transaction reported in Form 24G statement. (iii) Transfer Voucher Date: It is the last date of month for which Form 24G statement is filed. BIN is required to be disseminated to the respective DDOs who in turn are required to report the same in the TDS/TCS Statement. The quoting of BIN has been made mandatory w.e.f 01stFebruary, 2012. BIN is a unique number to verify the claim of TDS deposited without production of challan. As it is a verification key, it is advised that valid BIN disseminated by AO to the respective DDO should be correctly filled in TDS statement. 23. When is BIN generated? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DO should be mapped to one AO only for a particular form type for a particular month. 28. What are the duties of PAOs/DTOs/CDDOs? i. To apply for AIN with jurisdictional TDS office. AIN application can be downloaded from TIN site. ii. To obtain correct TAN from the reporting DDOs. iii. To file Form No. 24G (in CD, DVD, Pen Drive), within 10 days from the end of the month, electronically either at TIN-FC or by direct online upload at TIN website. iv. To track status of the filed Form No. 24G through TIN website. v. To download Book Identification Number (BIN) generated on the basis of 24G statement. vi. To disseminate BIN to the respective DDOs. 29. What are the duties of DDOs? i. To provide correct TAN to their PAOs/DTOs/CDDOs to whom the DDO/Deductor reports the tax so deducted who is responsible for crediting such sum to the credit of the Central Government. ii. To report to PAOs/DTOs/CDDOs, the details of tax deducted and credited to the Central Government account through book adjustment. iii. To quote BIN in the quarterly TDS/TCS Statement (24Q, 26Q, etc) for the tax deducted and credited through book adjustment. iv. Filing of TDS/TCS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PAO Pay Accounts Officer DTO District Treasury Office STO Sub Treasury Office DDO Drawing Disbursing Officer CDDO Cheque Drawing Disbursing Officer ANNEXURE VI POINT NO.4.9 OF DRAFT CIRCULAR OF DEDUCTION OF TAX AT SOURCE FROM SALARIES U/S 192 OF THE INCOME TAX ACT, 1961 FINANCIAL YEAR 2015-16- PROCEDURE OF PREPARATION OF QUARTERLY STATEMENT OF DEDUCTION OF TAX UNDER SECTION 200(3) OF THE ACT 1. Quarterly e-TDS statement/return should be prepared by Deductor/DDO as per the data structure (File Format) prescribed by the DIT (Systems), Delhi which is available on TIN website www.tin-nsdl.com . Deductor/DDO can prepare e-TDS statement/return either by using in-house facilities, third party software or by using Return Preparation Utility (RPU) developed by NSDL e-Governance Infrastructure Limited (NSDL), which is freely downloadable from the TIN website. After preparation of e-TDS statement/return, the Deductor/DDO is required to validate the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l signature, prior to 2013- 14 onwards) Y N Y N N Y Y N N For more information, deductors are advised to refer to e-tutorials/FAQs available on TRACES portal. Online correction entails no charges and does away with the requirement of downloading conso file and visiting TIN-FCs. 2.1.2 With effect from 1st January, 2015, TRACES will be providing a correction window of 7 days from date of processing at CPC-TDS (generally 2 days after date of filing of statement). This facility will enable the filer to correct PAN errors and challan mismatch cases identified by CPC-TDS and avoiding of issuance of demand notices. Therefore, deductors are advised to check the processing status promptly so as to utilize this facility. 2.1.3 Deductor/DDO can also file a correction e-TDS statement for any modification in the e-TDS statement. Correction statement can be prepared by using the TDS Consolidated file that is available at TRACES ( www.tdscpc.gov.in ). Validation of correction statement is in line with regular e-TDS statement, physical For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing a unique 15 digit token no. and 8 digit receipt number is generated and displayed. There is no need to submit physical form 27A in online upload. Deductor/DDO can view the status of e-TDS statement/return on TIN website. No charges are applicable for online upload of e-TDS statement/return. 4.1 Correction of e-TDS statement/return online at TIN website: Deductor/DDO can file a correction e-TDS statement/return for any modification in e- TDS statement/return accepted at TIN central system. Correction statement/return can be prepared by using the TDS consolidated file only, available at the CPC-TDS portal www.tdscpc.gov.in through TAN registration. Preparation and validation of e-TDS statement is in line with regular e-TDS statement/return (submitted at TIN-FC) Deductor/DDO can login with its user ID and DSC and upload the validated e-TDS file (.fvu file) generated by the FVU to the TIN website. On successful acceptance of correction e-TDS statement/return at TIN, an acknowledgement containing a unique 15 digit token number is generated and displayed. There is no need to submit copy of provisional receipt of regular e-TDS statement/return, physical Form 27A and S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... individual would receive a lump-sum of the remaining pension wealth, which he would be free to utilize in any manner. Individuals would have the flexibility to leave the pension system prior to age 60. However, in this case, the mandatory annuitisation would be 80% of the pension wealth. Architecture of the new Pension System (i) It will have a central record keeping and accounting (CRA) infrastructure, several pension fund managers (PFMs) to offer three categories of schemes viz. option A, B and C. (ii) The participating entities (PFMs and CRA) would give out easily understood information about past performance, so that the individual would be able to make informed choices about which scheme to choose. 2. The effective date for operationalization of the new pension system shall be form 1st of January, 2004. U.K. SINHA, Jt. Secy. ANNEXURE-VIII MINISTRY OF FINANCE Department of Revenue (Central Board of Direct Taxes) Notification New Delhi, the 24th November, 2000 INCOME- TAX S.O.1048 (E) - In exercise of the powers conferred by sub-clause (i) of clause (18) of Section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. President s Police Fire Services Medal for Gallantry -do- 14. President s Fire Services Medal for Gallantry -do- 15. President s Home Guards and Civil Defence Medal for Gallantry -do- 16. Home Guard and Civil Defence Medal for Gallantry -do- (Notification no. 1156/F.No. 142/29/99-TPL) T.K. SHAH Director ANNEXURE IX MINISTRY OF FINANCE Department of Revenue Central Board of Direct Taxes New Delhi, the 29th January,2001 S.O.81(E)- In exercise of the powers conferred by sub-clause (i ) of clause (18) of Section 10 of the Income tax Act, 1961 (43 of 1961)), the Central Government, hereby specifies the gallantry awards for the purposes of the said Section and for that purpose makes the following amendment in the notification of the Government of India in the Ministry of Finance, Department of Revenue (Central Board of Direct Taxes) number S.O.1048(E), dated the 24th November 2000, namely:- In the said notification, in the Table, against ser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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