How to claim income tax deduction for investments made in April - July 2020

The legislature had forced an across the country lockdown in March due to the coronavirus pandemic flare-up across India. Because of this lockdown that started in March, days before the end of the monetary year, a few citizens had been denied the chance to make charge sparing venture for budgetary year 2019-20 (FY20). The legislature had henceforth stretched out the due date up to June 30, 2020, and has as of late given a further augmentation until July 31, 2020 for making charge sparing speculations relating to FY20. This move has given citizens more opportunity to contribute and spare assessment.
Thinking about the above model, it is totally dependent upon the citizen to choose which money related year he needs to guarantee the reasoning for speculations made in the long periods of April to July 2020. In any case, another point to consider is that the legislature has presented another expense system in Budget 2020, where citizens can pay charges at decreased assessment rates, in the event that they select to not guarantee any reasonings from their salary.
In the event that an expense filer chooses to pay charge under this new system for FY21, at that point it is reasonable to prepare and guarantee whatever speculations are feasible for FY20 as it were. The staying unclaimed ventures won't have the option to be conveyed forward in such cases.
How to guarantee?

The individuals who need to guarantee conclusions for speculations made in April, May, June and July 2020 in FY20, are required to record plan DI, or Details of Investments, in their ITR structures for FY20, which are expected on November 30, 2020. Calendar DI will contain subtleties identifying with ventures, stores and installments made under segment 80C to area 80GGC of the Income Tax Act, where the qualified measure of reasoning for FY20 is to be revealed. Further, conclusions owing to any venture or consumption made during April 1, 2020 and July 31, 2020 should be independently determined. Any sum used out of the capital additions represent FY20 for interests in plan 54 to 54GB will likewise should be indicated in this calendar.

Trade mis-invoicing cost India $13 bn in tax revenues in 2016, says report

Current Affairs

India is estimated to have lost $13 billion potential tax revenue in 2016, equivalent to a staggering 5.5 per cent of total government revenue collections back then, due to simple trade invoicing.
The findings, part of a report by Washington, DC-based think tank Global Financial Integrity (GFI), are set to worry policymakers who have increasingly tried to crack down on fraudulent tax practices.
Trade misinvoicing involves both exporters and importers deliberately misreporting the value, quantity, or nature of goods or services in a commercial transaction and is treated as one of the most common forms of tax fraud by the government.Of the lost revenue, approximately $4 billion was due to deliberate misinvoicing of exports, while $9 billion was due to the same being done for imports.
The lost revenue on the import side can be further broken down by uncollected value-added tax worth $3.4 billion, uncollected Customs duties costing $2 billion, and uncollected corporate income-tax worth $3.6 billion, GFI said.
Released on Monday, the report also pointed out this trade gap for misinvoiced goods may be as high as $74 billion, equalling 12 per cent of the country’s total trade of $617 billion in the same year.
A report by the UN had earlier warned New Delhi that valuable earnings, mostly in commodity imports, were regularly vanishing and had suggested updating trade policy to counter the issue.

India should also encourage other countries to adopt a beneficial ownership registry, to fully implement financial action task force’s anti-money laundering recommendations, country-by-country reporting, tax information exchange initiatives and the Addis Tax Initiative, GFI said.Back in 2017, a similar report by GFI pegged the total illicit inflows into India between 2005 and 2014 at $770 billion.

Kerala govt to impose 1% flood cess from June 1 for rehabilitation work

Economy News

The Kerala government will impose a cess of up to one per cent on inter-state movement of goods and services to final customers from June to provide relief and rehabilitation to those affected by flood in the state last year.

There will be no cess on goods drawing 2.5 per cent state GST, which includes essential items such as branded wheat, edible oil etc, according to a notification issued by the Kerala government. These items attract total five per cent GST, broken up into 2.5 per cent SGST and CGST each.

However, services attracting 2.5 per cent SGST such as economy air travel will attract one per cent cess. All other goods and services drawing 6, 9 and 14 per cent SGST would attract one per cent cess. Also, gold and silver on which 1.5 per cent SGST is there, would attract 0.25 per cent of cess.

There will be no input tax credit on the cess.Abhishek Jain, partner at EY, said, “With this cess, companies with presence in Kerala would need to quickly plan and gear their pricing, ERP system, business processes to factor and alighn it with this new levy.”

The CPI(M)-led LDF government had announced the “flood cess” announced in the state budget in February to mobilise additional revenue. The state has projected around 24 per cent increase in revenues from GST to Rs 65784.60 crore in 2019–20 against Rs 53110.58 in the revised estimates of the previous year.

Unlike other tax announcements, this cess was not effective from April one. Earlier, the issue of flood cess was discussed at a panel constituted by the GST Council. After its recommendations, the Council allowed Kerala to levy up to additional 1 per cent calamity cess under the GST regime for two years

Kerala is the first state to announce the flood cess.

Oil traders see little to justify the past fortnight's slump in oil futures

International News

Whether it's in the North Sea, West Africa or the Persian Gulf, traders of millions of barrels of crude are seeing little to justify the past fortnight’s slump in oil futures.

Crude on exchanges in New York and London fell as much as 7 percent since late April despite the temporary halt of a pipeline delivering millions of barrels a month of Russian oil to Europe’s refiners. The cessation added to a long list of supply disruptions and curtailments elsewhere in the world.
“There is no true sign of weakness in the physical market,” said Olivier Jakob, managing director of consultant Petromatrix GmbH in Zug, Switzerland. “You have lower exports from Venezuela, you’ve got sanctions form Iran, Libya which is still a risk.”

While futures sold off against a backdrop of concerns about the U.S.-China trade dispute, markets for physical barrels are anchored to the supply and demand of actual cargoes of oil. And, if anything, those are strengthening.

Record Premiums


 In Europe, traders are willing to pay higher premiums to secure immediate supplies of Brent crude, a global benchmark grade. The North Sea’s main loading programs next month will be the smallest in years -- just before northern hemisphere refineries start purchasing more oil for summer processing. Traders in West Africa and the Mediterranean also report bullish markets.Likewise, Asian refiners have been paying record premiums to secure heavy crude from Iraq that should help cover them against declining flows from Iran. They also secured extra crude from Saudi Arabia for June, despite the kingdom’s leading role among oil producing nations in restricting supplies.One fly in the ointment for bulls is the U.S., where production is still expanding and stockpiles continue to swell at Cushing, the nation’s storage hub.

No tax liability if your income is up to Rs 9.5 lakh, but conditions apply

Personal Finance News:

Stressing that tax concessions have been provided with a view to help poor and middle-class people living on a tight budget, Finance Minister Piyush Goyal said that now individuals earning up to Rs 9.5 lakh can escape liability by taking advantage of saving schemes.

Replying to the debate on the Finance Bill in Lok Sabha, the Minister said he did not propose any change in the tax rate but only provided few rebates which will boost spending and help the economy.
The Finance Bill, which contains tax proposals, was passed by the Lok Sabha with a voice vote, completing the budgetary process in the lower house.

In a swipe at the Congress, the Minister said that unlike the previous UPA dispensation, the present Modi government in the interim budget did not reduce levies of SUVs which are used by rich persons.

In the Finance Bill 2019, the Minister proposed to raise tax rebate for people having annual income up to Rs 5 lakh from Rs 2,500 to Rs 12,500, which will effectively ensure that they don't have to pay any tax.

In the Bill, standard deduction has also been raised from Rs 40,000 to Rs 50,000, besides a host of tax benefits to home buyers.

The concessions proposed in the Finance Bill, Goyal said, are aimed at helping "poor and middle-class people living on a tight budget...This is interim budget. We have not brought any tax proposal...we will bring them in July," he said.


 The next government, which will be formed after the upcoming general elections, will come out with a full budget in July. The next government will also come up with a Finance Bill containing the tax proposals for 2019-20.

Non-filers will have 21 days to file I-T returns, submit response: CBDT

Economy & Policy:

Individuals who have carried out high-value transactions but have not filed their income tax returns for the assessment year 2018-19 would get 21 days time to submit their responses, the CBDT said Tuesday.

The 21-day time period would be from the date of receiving e-mail or SMS from the I-T Department regarding non-filing of tax returns.

In cases where no return is filed or no response is received for Assessment Year (AY) 2018-19 within the stipulated time, the department would consider initiating proceedings under the Income Tax Act 1961.


 The Central Board of Direct Taxes (CBDT) said data analysis has identified "several potential non-filers" who have carried out high value transactions in 2017-18 but have still not filed returns for AY 2018-19. CBDT, however, did not disclose the number of such non-filers...Read More