Still not filed ITR of 2018-19? March 31st is the last date for you

The financial year is about to get end and here are few things you should know before the year ends. The most important thing one should be sure of before ending the financial year is to ensure if they have filed the ITR of the previous year or not.

So this year, if you haven’t filed the ITR for the financial year, 2018-19, then this is going to be the last chance to fill it late. You are already late but if you don’t fill it by now, you will have to face the consequences.

It is not only about making the tax related deadlines but also include things like advance making payments for tax, and tax saving exercise as well. For making it official, the ITR department has tweeted and listed down the essential and mandatory tax related dates you must be aware of.

For filling the late ITR for the financial year 2018-19, the last date is March 31st, 2020. if you are not able to complete it and file the return before the date, then you won’t be able to do it unless asked by the income tax department. You also have to pay the late fees of rs 10,000 as a tax payer to become late. However, if your income isn’t more than 5 lakhs in a financial year, you only have to pay rs 1,000 a fine.

Also, if you have filed the ITR of 2018-19 but you have made a mistake in filing it, then you have a chance to rectify the mistake now before the date as once the date is gone, you won’t be able to rectify it.

For the people interested in paying the final advance tax instalment for the financial year 2019-20, then you can do it by or before March 15, 2020.

Is it possible to save tax for NRI by buying health insurance in India?

Health Insurance is a good step to be taken in order to protect yourself from the big and heavy expenses that might come in future. In fact, if you see it from the tax benefit purpose, it is very beneficial. But if in case you are a non-residential Indian, and you have taken the health insurance policy in India, will it still help in saving tax?

Yes, you will. Even if you don’t leave in India, and you have taken the policy from here, you are still eligible to have a tax benefit only on the taxable income earned in India.

No matter if you are buying it for yourself or for your other family members, it will be helpful for you. However, if you have bought a policy in India and want to claim it for the medical expenses of any other country, then it won’t work there.

On this, the partner of Deloitte, Aarti Raote said-NRIs are comparatively viewed riskier by insurance companies considering the efforts of collecting facts and ascertaining the authenticity of claims. However, NRIs covering for the health of their parents and family in India through an Indian insurance company is certainly advisable., if an NRI buys a health insurance policy abroad, the policy may cover the treatment in India. However, the payment of premium for that policy will not be eligible for tax-benefit in India.”

NRIs are eligible to claim deduction up to specified limits for health insurance premium paid similar to Indian residents. The deduction can be claimed for the premium paid not only for self but also for parents, spouse and dependent children. However, such deduction is available only in relation to the premium paid towards the health insurance policies which are approved by the Insurance Regulatory and Development Authority of India (IRDAI). Apart from tax considerations, NRI should also consider other practical aspects while buying for a health insurance policy in India such as policy terms in relation to geographical areas covered, foreign exchange management regulations relating to settlement or repatriation of claims etc.” Added by the tax partner, Shalini Jain, people Advisory services, EY, India

Important information for NRI related to tax

Whether you are eligible to pay the tax depends on your residential status and the budget. These things are crucial to know and if you are a non residential Indian, then there are few things you need to know.

If you are a citizen of India who is settles outside India and your stay in India was under 181 days during this financial year, this information may be important to you. There are changes proposed by the budget in the residency rules. It means that if your stay is 120 or more in this financial year of total 365 days, then you are eligible to become a resident of India.

For people who are not the not ordinarily residents, thins will get changed. These will be considered as NOR if they are a non resident who have stayed 7 years out of 10 years in different country.

You must file a return of income if your income exceeds INR 25,000. however, if the investment income or long term capital gains are from foreign exchange, then it will be prescribed for NRI and the taxes will be due and you will get an option to not file the return of income.

If you still have not filed the tax return of previous year 2018-19,. then the last date of do that is March 31, 2020. if you are not able to make it this time, you will not be able to file this return ever. It is important to file the return before the date otherwise you will miss it totally.

Also, if you are looking to make any advance payment of tax of the financial year, 2019-2020, then the last date is 5th April to do so.

Eligible for Vivad se Vishvas? Check now

The new sheme has launched and people are not sure with the same. Here, you can know if you are eligible or not for the scheme launched the govt of India.

Income tax cases which are being arbitrated abroad will all be eligible for the scheme called Vivad se Vishvas in order to settle the disputes that are going on between the tax payers and the taxman.

The public’s message has been spelled out for the features of the scheme which is proposed by the current finance minister, Nirmala Sitharaman in her latest Budget speech she gave on 1st February. She has covered everything from payment terms, disputes cover and also the eligibility.

If you are interested to take the scheme and you want to file it, then you must have filed the return before January 31st and if you did that, you are allowed.

Some other eligibilities are, to order for the time for filing appeal should not be expired on 31st January. All the disputes where the payment has been made long ago are eligible for the scheme. No matter if they are living in India or abroad, if they meets the criteria, they are eligible.

On the whole thing, the notice reads-
“If an issue in taxpayer’s pending appeal is already decided in his favour by appellate forum or if department has filed appeal on an issue, amount payable is 50 per cent of aforesaid amounts,”.

The scheme is also not yet launched and is yet to notified. People who are interested in the scheme should be looking for the same and once the date comes, they can know more about the same and apply for the scheme.

To make them realize the importance of Pension products, the tax benefits should go

Recently in February afte the budget, Supratim Banyopadhyay got appointed as PFRDA chairperson. Now, PFRDA is looking to regulate the pension schemes and on this, Mint took the interview of My Banyopadhyay where he told the changes he wants to make-

As the new chairperson, what would be your immediate priorities?

The first priority is to see that the proposed amendment to the Pension Fund Regulatory and Development Authority (PFRDA) Act that was announced in the Budget goes through smoothly (the budget proposed to separate NPS Trust from PFRDA. There is a view that a regulator managing funds can lead to conflict of interest). We have to do a lot of groundwork and be ready for the changes internally. The parliamentary process may take some time.

For this, we are working on the structure of the NPS Trust after its separation from PFRDA. Proposals have to go from us to the government. After that, there will be consultations with the government.

We have also proposed to the government to have uniform taxation in NPS, which we expected in the Budget. The 14% NPS contribution by the central government for its employees is tax-free. But it is 10% for state government employees and other individuals. We had proposed that the 14% contribution from the employer should be tax-free for all subscribers. The proposal did not get through in the budget, but we will be pursuing it with the government.

We also requested clarifications on other aspects of NPS taxation. For example, we have sought clarity on the taxation if a subscriber withdraws from his tier-II account.

There have been talks on introducing alternatives to the mandatory annuity that an NPS subscriber needs to buy with the 40% corpus on maturity. What are your plans?

At present, we are at a nascent stage. There are two ideas we are exploring. One, we are looking at whether the 40% corpus can remain within the system. Our fund managers will invest this corpus in the market and pay out the subscriber. The other option is to introduce some kind of systematic withdrawal plan. But we have to work out the final structure for these ideas.

If you are a late, you cant use new tax regime unless govt clarifies. Check here

The new financial year has been started. And now, people can select between the new tax regime which is proposed in this year’s budget and the existing one while filing the income tax return. If one selects the new tax regime, it will offer you lower income tax rates without the benefit of 70 tax exemptions and the deductions.

While discussing the same with tax experts and CA, all the individuals who are opting for the new tax regime should know that the tax liability of their will be calculated according to the proposed new tax rates only if the tax return is filed before normal deadline which will be given.

On this, Ashok Shah, senior partner, NA Shah associates states- , “Individuals not having any business income (i.e., salaried individuals and pensioners) must file their tax return before the due date prescribed under section 139(1) of the Act (i.e., 31 July) to take benefit of lower tax rates in the new tax regime. If a tax return is filed belatedly, income tax rates under the new tax regime will not apply for that financial year.”

“On a plain reading of the proposed section, it seems the option to avail concessional tax rates can be exercised for tax return filed as per timelines provided under Section 139(1) of the Income Tax Act 1961. It may not be exercisable for belated returns filed under Section 139(4) of the Act

This is because the law itself requires exercising the option in tax returns filed on time under Section 139(1). In case of belated return filing, one may need to approach CBDT under Section 119(2)(b) of the ITA for condonation of delay. More clarity from the government would be welcome in this regard as there may be genuine reasons where a taxpayer is unable to file tax return on time.”Says Shalini Jain, partner, People advisory services.