New TDS/TCS rules for NRIs: In the Union`s 2021 budget speech, Finance Minister Nirmala Sitharaman announced new provisions regarding TDS (withholding tax) and TCS (withholding tax) for taxpayers. These new TDS/TCS rules will come into effect on July 1, 2021. The 2021 Finance Act introduced three major changes to the rules relating to withholding tax (TDS) or withholding tax (TCS). These changes come into effect on July 1, 2021 and are intended to facilitate compliance standards for businesses and make the business generally compliant with tax legislation. One. The 2021 Finance Bill introduces a new Section 194Q that requires a person to deduct a 0.10% withholding tax if they pay an amount to a resident (hereinafter referred to in this section as a seller) for the purchase of goods worth more than Rs 50.00 in a previous year. The provisions of this section shall apply from 01.07.2021. Note: The previous year is the fiscal year under the Income Tax Act. Since the provisions come into force on or after July 1, 2020, returns from the previous fiscal years 2018-19 and 2019-20 are taken into account. As the deadline for filing the income tax return for the 2020-21 fiscal year has not yet passed, the new rules do not apply to the 2020-21 fiscal year. Sir, I bought a car worth Rs.14.99 lakhs on 01.07.2021 in the name of my wife who is unemployed (housewife).
If we now pay 1% tax or 5% tax, please specify, as she should not file computer tax returns for previous years because she is unemployed. And if the buyer exceeds the threshold, they are required to deduct TDS on any purchase or payment made on or after July 1, 2021. For example, you have goods worth Rs. 55 lakhs purchased on 30-06-2021 and 45 lakhs on 01-07-2021, then you are obliged to deduct TDS @ 0.1% of Rs. 4500 on purchases of Rs. 45 lakhs. Since you`ve crossed the threshold for the year, start deducting TDS now on any future purchases or payments (starting July 1). The main changes relate to the purchase of property, the retirement income of eligible seniors and accelerated TTY rates for non-filers. While the amendments regarding the purchase of property and the increase in the TDS for non-filers will initially apply as of July 1, the changes to the pension income provisions will apply to the entire current fiscal year (fiscal year 2021-22), i.e. as of April 1, 2021. If tax is to be deducted for July 2021, the previous year 2021-22, i.e.
for the 2 relevant previous years for which the ITR submission is to be reviewed, 2018-19 and 2019-20 (AY 2019-20 and 2019-20 respectively) are deductible. 2020-21). As the deadline for the previous year, 2020-21, did not pass, India ended 2021 at a peak after violating South Africa`s fortress Centurion i. Added a new reason code to mention the reason for non-collection / lower collection / or survey at a higher rate. in Forms 26Q, 27Q, 27EQ to adapt the form to the new provisions amending Rule 31A U/N 71/2021 Dt 08-06-2021 {Income Tax (17th Amendment) Rules, 2021} TDS stands for Tax Deducted (or withheld) at Source. According to Article 194Q, the income tax department orders any company or individual to deduct withholding tax if the payment exceeds Rs. 50 lakhs for the purchase of goods and services, such as rent, advice, legal fees, royalties, technical services, etc. TDS rates are set in advance by the government in accordance with the Income Tax Act. Click on the button below to see the TDS rates for different types of goods and services for fiscal year 2021-2022. In each TDS transaction, the company or person deducting TDS from the payment is referred to as the place of deduction, and the company or person receiving the payment is referred to as the deductor.
NOTE: 1) Purchases or payments made between April 1 and June 30, 2021 will only be taken into account for determining the threshold of Rs 50 lakhs for the 2021-22 financial year, NO TDS deducted for the said period. 2) TDS may be deducted on all purchases recorded or paid from 1 July 2021 u/s 194Q, subject to provisions u/s 194Q (provision u/s 194Q – if the buyer`s turnover exceeds 10 crore in the previous financial year and the purchase value of the goods in a financial year exceeds 50 lakhs). Subject to the provisions of Section 194Q, TDS will be deducted by the buyer @ 0.1% on the “value exceeding the limit of 50 lakhs” (i.e. the purchase amount remaining after 50 lakhs). For example, if you buy goods worth Rs. 60 lakhs on 05-07-2021, you will have to deduct TDS @ 0.1% from Rs. 1000 (60,00,000 minus 50,00,000 = 10,00,000). Note: However, the threshold limit requires you to account for purchases or payments made for the entire 2021-2022 fiscal year. Thus, if a person who is a buyer has already credited or paid a seller 50 rupees lakh or more, section 194Q TDS applies to all loans or payments to that seller from July 1, 2021. From 1 July 2021, a new tax rule will come into force, according to which non-filers will be subject to higher income tax taxation in the last two financial years.
For the purposes of the threshold, purchases made between April and June 2021, i.e. the whole fiscal year, are also taken into account. However, TDS` liability arises from the purchase amount registered or paid from 1 July 2021 in excess of Rs 50 lakhs. Please note that under subsection 3 of section 194Q (Guidelines under section 194Q of the Income Tax Act, 1961 – published on June 30, 2021), it has been clarified that the provision of this subsection does not apply to amounts credited or paid before July 1, 2021. This means that if purchases or payments are made before July 1, 2021, that transaction is not subject to the provisions of Section 194Q. June did not accept 194Q TDS. » My question is whether we should apply TDS on our payments ONLY FOR PURCHASES MADE ON 1.7.2021 OR EVEN FOR PURCHASES MADE ON 30.6.2021 AND BEFORE? Hi Lord, I had purchased before 30.06.2021 and the invoice is due in July when I transferred the payment to the party so that I can deduct tds or not. The Central Board of Direct Taxes (CBDT) has said that people who have not filed a tax return for two years are subject to a higher TDS or TCS rate. Under the new rules, the TDS or CHT will be twice as high as the tax rate set out in the corresponding provision of the Income Tax Act. Or Hello Sear this page Sachin, I would like to know one thing how to determine the exemption limit, with the GST component or without GST components, suppose one invoice amount is 19 lakh with GST and another invoice amount is 22 lakh with GST before 30.06.2021 and a purchase will be made on 1.07.2021 for Rs 17 lakh with GST & GST rate is 18%, Now, how to calculate the exemption limit for the GST component amount or not or to what amounts we deduct TDS TCS was made by the seller u/s 206 C (1H) for all these purchases no later than 30.06.2021, suppose a purchase of Rs 60 lakhs was made during the period April-June 2021 and another purchase of Rs 30 lakhs was made on July 5, 2021. Then, in this case, we are forced to subtract TDS at 0.1% to Rs 30 lakhs = Rs 3000/-. Sir, if the buyer has to deduct the TDS @ 0.1% after exceeding the purchase value or payment of Rs.
50 Lakes? or does the buyer have to deduct TDS on each payment to the seller after 1.07.2021? Dear Sir, if we have a new business just as month June-2021 with partnership, IF OUR TURNOVER OF JUNE 2021 MOTH EXCEEDS RS 10 CRORE, THEN WE CAN MAKE TCS OF OUR PARTS If quoted in the 1st example, suppose you buy goods worth Rs. 60 lakhs on 05-07-2021, you need to deduct TDS @ 0.1% from Rs. 1000. And then buy goods worth 25 lakhs on 25-07-2021, then subtract TDS directly from the value of 25 lakhs, or TDS of 2500. Reason: As mentioned in my article, although this provision applies from July 1st, purchases made during the period from April to June will also be taken into account to see if 194Q is applicable. However, TDS will only be charged on the purchase amount booked or paid after July 1. Therefore, in the example given, the purchase of 60 lakh was only taken into account for the applicability of 194Q, and here the 194Q is applicable because (60 + 30) exceeds the threshold of Rs 50 lakh and TDS was therefore deducted at 30 lakhs purchased after July 1, 2021. We paid more than Rs.50 lakes from April to June 2021 and our payments in July and August will also be higher than Rs.50 lakes each month (I give context, I understand that the limit of Rs.50 lakes per year according to the computer section).
However, payments refer to past purchases, i.e. purchases in May are paid in July and purchases in June in August. The 2021 FINANCE LAW introduced two new changes to the rules relating to withholding tax (TDS) or withholding tax (TCS). (2) The withholding tax (TCS) for the period from 14 May 2020 to 31. March 2021 will be charged at the discounted rates shown in the table under 2 above. 2) ATS on retirement income of seniors (section 194P): This provision, in force since April 1, 2021, was introduced to exempt persons aged 75 and over from filing the income tax return (ITR) under the following conditions: My request concerns purchases made on or before 30.06.2021 for which payments are made from 01.07.2021, Since then the seller has granted a 2-month loan. TDS rates vary by category. This compilation is available for a detailed review of the applicable TDS rates for fiscal year 2021-22 and the 2022-23 tax year. Related topic: PDF of the 2021 Finance Law adopted by Parliament A clarification was made on this subject, which was published on the 30th. June 2021, see Circular No.
13 of 2021, which states – my change from the previous financial year.