Thursday, July 29, 2021

Government announces big tax reliefs for taxpayers

The Central Government has announced tax exemptions to encourage employers and members of the public for assisting those people with COVID-19 treatment expenses and also those who have lost their families to the virus.

Anurag Thakur, Minister of State in the Ministry of Finance confirmed the development. “Amount paid by an employer or any other person for the treatment of an employee in 2019-20 and thereafter will not be taxable,” he said.

Tax exemption on Covid-19 treatment, deaths

The government said that many taxpayers have received financial help from their employers and well-wishers to meet the cost of treatment of Covid-19. It has declared that there will be no tax liability on such amounts.

“In order to ensure that no income tax liability arises on this account, it has been decided to provide income tax exemption on the amount received by the taxpayer from the employer for medical treatment or from any person for treatment of Covid-19 during the financial year 2019-20 and subsequent years,” said the finance ministry’s notification.

No tax on ex-gratia payment

No tax on ex-gratia payment received on account of the family member of the deceased employee due to Covid. Financial help received from relatives and friends will also not attract any tax till the total amount reaches Rs 10 lakh.

Deadline for PAN and Aadhaar extended

Many people were facing discrepancies in linking their PAN with Aadhaar on the new income tax e-filing portal, therefore, the government has now extended this date from 30 June 2021 to 30 September 2021.

Payment making under Vivad se Vishwas scheme extended

The deadline for payment (without additional amount) under Vivad Se Vishwas scheme has been extended till August 31 while the last payment date with additional amount has been extended till October 31.

Deadline for saving capital gains tax extended

Tax compliance deadline extended to save capital gains tax. Tax compliance time falling between 1st April 2021 and 29th September 2021 for making an investment, acquisition, deposit, payment, purchase, construction or such other action to save tax under the provisions contained in sections 54 to 54 GB of the Income-tax Act has been extended till 30 September 2021.

Vivad se Vishwas Scheme

This scheme has been introduced by the Government of India, highlighting the details regarding the Direct Tax Disputes Settlement Scheme. Known as the Direct Tax ‘Vivad se Vishwas Bill, 2020’ for dispute resolution to direct taxes, it proposes the idea of ​​levying reduced or concessional payment from a taxpayer, if he/she settles all the disputes before the end of the particular financial year, i.e. FY 2019-20, under this scheme.

But due to Covid-19, the deadline for payment under Vivad Se Vishwas scheme has been extended till August 31 while the last payment date with additional amount has been extended till October 31.

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