The Bombay High Court has nullified a reassessment order against a housewife, noting that the property was purchased solely by her husband. The Income-tax (I-T) authorities, on noting a high-value transaction of purchase of property valued at more than Rs. 30 lakhs, had held that income had escaped assessment. Thus, a reassessment order was passed under section 148A (b) of the I-T Act for the financial year 2015-16.

Some Indians go abroad as employees, while others choose to work for themselves. Being Indian citizens, both are subject to the income tax laws of the country. But, will ’employment’ will be governed by similar tax laws as ‘self-employment’ for these taxpayers generating overseas income?

Mumbai ITAT Rules that the term “Employment” under Section 6 – Explanation 1(a) of the Income Tax Act, 1961 shall include “Self-Employment”In accordance with Section 6(1) of the Income Tax Act, 1961, an individual would be considered as an Indian tax resident if he has stayed in India for a period of 365 days or more within 4 years preceding the relevant financial year and has stayed in India for a period of 60 days or more in the relevant financial year.

The Income Tax Department will kickstart a drive against the individuals and entities who are required to file their income tax returns (ITR) but have not done.

The I-T department has identified 1.52 crore such individuals who have the income or have had tax deducted at source (TDS) but did not file their returns

Some Indians go abroad as employees, while others choose to work for themselves. Being Indian citizens, both are subject to the income tax laws of the country. But, will ’employment’ will be governed by similar tax laws as ‘self-employment’ for these taxpayers generating overseas income?

Mumbai ITAT Rules that the term “Employment” under Section 6 – Explanation 1(a) of the Income Tax Act, 1961 shall include “Self-Employment”

The income tax department on Friday said amendments to the India-Mauritius double tax avoidance treaty (DTAA) have not been ratified and notified under the Indian law.
"As and when the protocol comes into force, queries, if any, will be addressed, wherever necessary," CBDT said in a social media post. Earlier this month, India and Mauritius had signed a protocol to amend the treaty raising concerns over how it would affect new and old investments routed to the country.

The income tax department has come out with an interim action plan for 2024-25 fiscal year, which include identification of potential cases of prosecution, wherein there is short-payment of TDS and faster disposal of appeals.
The action plan also stipulates timeline for approval of refunds, identification of cases where seized assets are due for release and release the same by June 30, 2024.

The amendments to the double taxation avoidance agreement between India and Mauritius are aimed at dissuading tax avoidance, believe experts, but note that there remain some areas of ambiguity, especially with regards to its applicability.

“The recent Protocol to the India-Mauritius DTAA, which incorporates the Principal Purpose Test (PPT), represents a move by India to align with global efforts against treaty abuse, particularly under the BEPS Action 6 framework. The introduction of the PPT aims to curtail tax avoidance by ensuring that treaty benefits are only granted for transactions with a bona fide purpose,” said Rakesh Nangia, Chairman, Nangia Andersen India.

HRA claims: The CBDT has clarified that there is no special drive to review mismatched HRA cases, refuting concerns of retrospective taxation. Instances of information mismatch have been identified, prompting the department to notify taxpayers to rectify any discrepancies.
HRA claims relief: The Central Board of Direct Taxes (CBDT) has clarified that there is no special drive to reopen cases related to House Rent Allowance (HRA) claims. The income tax department stated that there is no ongoing special drive to review mismatch cases. Concerns have emerged about potential retrospective taxation and reopening cases related to HRA claims.

It is quite common to include the name of a spouse in the ownership of a flat. A recent decision of the Mumbai-bench of the Income-tax Appellate Tribunal (ITAT) will prove useful to many. The ITAT has held that such joint-ownership will not impact the spouse’s eligibility to claim tax benefits under section 54-F of the Income-tax (I-T) Act, relating to long-term capital gains, when he/she sells another asset (say land, shares etc) and reinvests the sale proceeds in another flat.

When a taxpayer earns long-term capital gains from sale of any asset (other than a house property), the tax arising on the gains can be saved by investing the net sale proceeds in a residential property.

April 1, 2024, marks the beginning of the new financial year i.e. 2024-25. However, the old income tax laws applicable last financial year (FY 2023-24) will continue to apply in FY 2024-25 as the government has not changed the income tax laws. It is possible that some changes in the income tax laws may be announced in the full budget to be presented by the new government after elections are over but till then the old laws continue.

April is an important month for salaried individuals from a tax planning perspective - for 2024-25 in this case. This is because salaried individuals are required to inform their respective employers of the tax regime - old or new - that they wish to opt for during FY2024-25 in April itself. The tax regime a salaried individual opts for will decide the amount of tax that the employer will deduct from his/her salary income during the financial year.

TDS deduction: Tax Deducted at Source (TDS) plays an important role in the Indian tax system, ensuring that taxes are collected at the source of income itself. It's important to not only deduct TDS at the specified rate but also to ensure the accurate deduction based on one's PAN-Aadhaar linking status. Failing to do so can lead to higher TDS rates if the PAN is inoperative or inactive due to non-linkage with Aadhaar.
As per an ET report, the TDS deductor or collector may face legal consequences and tax penalties for failing to check the dedutee's PAN status and deducting a lower TDS amount than required.

Around 23,000 taxpayers filed their income tax returns (ITR) in the first three days of Assessment Year (AY) 2024-25 (Financial Year 2023-24) after the Income-tax Department for the first time opened return filing utilities on its portal from the first day of the assessment year, that is, April 1, 2024.

Last year, even though the returns had been notified early, they became available for filing on the IT portal only in May (for Assessment Year 2023-24 or Financial Year 2022-23).

Filing functionalities were available from May 20, 2023 for salaried individuals (ITR-1) and individuals, HUFs, and partnership firms generating an income from a business or profession (ITR-4). The filing utility for individuals and HUFs having income other than income from profits and gains from business or profession was available from May 30 (ITR-2).

The Income Tax department on Thursday said ITRs 1, 2, 4 and 6 have been made available on e-filing portal from April 1, 2024, and about 23,000 returns have already been filed for the 2023-24 fiscal year.

This is for the first time in recent years that the Income Tax department has enabled taxpayers to file their I-T Returns on the first day of the new financial year and, is a step towards ease of compliance and seamless taxpayer services.

The Central Board of Direct Taxes (CBDT) has notified certain changes in the ITR-V form. ITR-V form stands for ‘Income Tax Return-Verification’ Form.

The ITR-V form is a single-page document sent to taxpayers via email after they e-file their tax return without using a digital signature.It also mentioned that if the return of income is uploaded but e-verification or ITR-V is submitted after 30 days of uploading, the date of e-verification/ITR-V submission will be treated as the date of furnishing the return of income. “All consequences of late filing of return under the Act shall follow, as applicable,” the I-T department’s notification said.

The income tax department has uncovered a scheme involving fraudulent use of Permanent Account Numbers (PAN) by individuals to falsely claim house rent allowance (HRA), despite not being tenants, stated a Times of India (ToI) news report. As per initial findings, around 8,000-10,000 significant cases have been identified, with amounts exceeding Rs 10 lakh in many instances. The investigation began when authorities stumbled upon purported rent receipts totaling approximately Rs 1 crore under an individual's PAN. However, upon questioning, the individual disavowed any knowledge of these transactions. Subsequent inquiry revealed that the individual had not actually received the rent attributed to them.

The Income Tax Department has enabled the online income tax return forms, ITR-1, ITR-2 and ITR-4, for FY 2023-24 (AY 2024-25) on the e-filing portal. The online ITR forms have been enabled from April 1, 2024. With the availability of income tax return forms, taxpayers eligible to file their tax returns using these ITR forms can now file their ITR for FY 2023-24.

As the new financial year begins on April 1, 2024, this is the right time look back at your investments made in the past and make plans for the new fiscal year. April holds much importance as it witnesses the implementation of most Budget 2023 proposals regarding income tax. You, therefore, must prepare for the new tax changes that will take place in the financial year 2024-2025.

In her last Union Budget speech, Finance Minister Nirmala Sitharaman had outlined various changes set to take effect from this day onward, impacting our finances. Here’s a breakdown of some key changes to be aware of, including expanded basic exemption limits and more.

Commerce and industry minister Piyush Goyal on Friday said that the angel tax was introduced because fly-by-night entities were using this route to inflate value and create capital. The minister said he would like to see more domestic funding for startups as foreign investors pick up ideas of bright young people and end up owning most of the companies.

Several new economy ventures, primarily in the fintech sector, have received income tax notices in recent weeks with respect to venture capital raised by them, according to people in the know. The notices — served under Section 68 of the Income Tax Act — have clubbed the investments received by these startups with the income earned by them, and tax and penalties have been levied on the combined amount, the sources said.

So much so that one startup, registered with the Department for Promotion of Industry and Internal Trade (DPIIT) - has been asked to pay Rs 37 crore in tax and penalty on funding of Rs 40 crore by venture capital investors, they added.

A UN model law on wealth tax, which would enable countries across the world to introduce consistent and straight forward legislation is now on the cards.
The task will be undertaken by the UN tax committee (a committee of experts on international cooperation in tax matters), whose members are nominated by, but not formally representative of, the UN-member countries.The UN guidance will provide countries with a blueprint to implement, giving them both the technical know-how and political backing to tax the wealth of the richest members of society – something that most countries have shied away from under fierce lobbying pressure.
The agreement on the guidance signals a historic shift in global consensus on taxing extreme wealth and is the latest demonstration of the UN’s ability to push the needle on tax reform at a globally inclusive scale.