Jun 30, 2014

Things to know about PPF account of minor child

10:00 PM 0
Things to know about PPF account of minor child
You can decide to open te Public provident fund account of the name of children for reducing tax liability and option of long tern saving. An individual can open only 1 account with his name.  In the case of opening PPF account with the name of minor child, the account will be maintained by the parents and practically both(individual and minor child) will be seen as one.

Eligibility- An Indian resident can open the PPF account with the name of minor child. Any of the parents(Father or Mother) can open the PPF account with the name of minor child. Both parents(Father and Mother) can not open the PPF account with same minor child. One account one person rule applies here.

Documents required- Documents required for opening the account of minor child are as follows.
- KYC documents of parents( Proof of address and 2 passport size photo)
- Photo of child.
- Proof of age of minor child( birth certificate or school ID proof) 

Investment limit- investment cap is Rs. 1 lakh per annum for a single account or an individual plus minor child account. According to PPF rules, no interest will be paid on amount exceeding Rs. 1 lakh. 1 lakh limit is on individual basis and not on account basis.

Declaration- An individual needs to declare all his/her PPF account before opening a PPF account with the name of minor child.

Income tax exemption- Income tax exemption on PPF account is maximum of Rs. 1 lakh under section 80C of income tax act. This rule applies on both account.

In case of death or incapability of the parents of minor child, court appointed guardian can open the PPF account with the name of minor child.

TDS Deductors needn't submit copy of receipt of SSR for e-TDS statements

5:05 PM 1
TDS Deductors needn't submit copy of receipt of SSR for e-TDS statements
Tin.nsdl has given this facility to deductors/collectors that they need not submit copy of provisional receipt of original statements statistics report(SSR) for furnishing e-TDS/TCS correction statements.

This rule is applied from 1 June 2014.

Jun 29, 2014

Govt should increase 80C tax deduction to 5 Lakh

2:30 PM 2
Govt should increase 80C tax deduction to 5 Lakh
One of several key challenges  to new government should be to meet the enhanced expectations of stakeholders and to contain the fiscal deficit. This year along with the following year’s Budget might be a reflection of this dilemma, till the overall economy is back on track with over 8% growth along with a manageable fiscal shortfall. No doubt, one of many key themes on this year’s policy changes should be to boost investment, which usually, in turn, should result in steady job creation.

Another area that will need attention is the particular falling savings rate in the economy. Households constitute the largest source of home-based savings. So it really is imperative that measures are delivered to encourage household benefits, and make these funds open to boost economic exercise. One of the widely used tax deductions availed by simply individuals and Hindu Undivided Individuals is under Section 80C with the I-T Act understanding that requires some reconsideration.

This deduction is fixed to R1 lakh every fiscal for investments manufactured in various tax-saving plans, such as Employees’ Provident Finance, Public Provident Finance, National Savings Document Schemes, Post Business office Schemes, deferred annuity plans, approved superannuation account, specified mutual/pension funds, payments made towards insurance coverage, expense incurred in children's tuition price to university, college, school or various other educational institutions located within India, specified term deposits using a bank, etc.

It is observed that this tax deduction encourages households to save funds for retirement and to meet contingencies. These types of funds, in flip, are utilised in order to meet larger socio-economic objectives with the country.

The limit involving R1 lakh is not in line with the current economic reality and contains not kept pace with the rising inflation. It must be enhanced to R5 lakh to produce it a purposeful tax-saving investment choice for households.

Over time, tax deduction has got bit cluttered with an array of investment and expenditure options, that are used to achieve very different objectives. For case, while PF means for long-term benefits, expenses incurred in children’s education are used to provide relief to households in order to meet their monthly or even quarterly children’s education and learning expense.

Interestingly, it really is only children’s education expense that is covered here, and never the expenses received on education regarding self and wife or husband, which is needed in today’s scenario as numerous people have to undergo learning programmes to help skill or re-skill them selves. Similarly, premium settled life insurance stands on an altogether different ground. These polices are used to help family manage financial stress within the demise of a great earning member. Thus, there is a ought to review this tax deduction vis-à-vis different investment/expense options which might be currently covered.


A different point that value attention is that will different instruments beneath this provision get different overall tax treatment. For case, PF schemes focus on the Exempt-Exempt-Exempt process, i. e., investment is eligible to tax deduction, attention earned is tax-exempt, along with the maturity amount just isn't taxed. On the particular contrary, though investment manufactured in specified bank deposits is eligible to tax deduction, the interest earned is taxable, which leaves minor net of tax interest income with There's a need to assessment various instruments using their company tax treatment angle at the same time.

Jun 28, 2014

Latest FVU version 4.3 e-TDS software free download

4:32 PM 0
Latest FVU version 4.3 e-TDS software free download
Tin.nsdl has launched latest version of file validation utility FVU version 4.3 e-TDS software. This latest version of FVU 4.3 is applicable for preparing quarterly e-TDS/TCS statements pertaining to financial year 2010-11 and onwards. From June 28, FVU version 4.3 is mandatory for statements pertain to financial year 2010-11 and onwards. Since then you can use both FVU version 4.2 and 4.3.

There are some new features added in the latest version of FVU version 4.3 which are as under.

Addition of New State code for “TELANGANA”. New State code “36” for “TELANGANA” has been added.

Applicability of FVU version: 
From June 28, 2014, FVU version 4.3 would be mandatory for statements pertain to FY 2010-11 onwards.

Download latest version of FVU version 4.3
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Latest RPU version 4.0 for e-TDS statements free download

4:23 PM 1
Latest RPU version 4.0 for e-TDS statements free download
Tin.nsdl has launched latest version of return preparation utility RPU version 4.0 for e-TDS/TCS statements. RPU version 4 will prepare quarterly TDS/TCS statements regular as well as corrective statements for financial year 2010-11 and onwards.

There are some features added in new RPU version 4.0 which are as under.
Addition of State “TELANGANA”  New State “TELANGANA” has been added.

Incorporation of latest FVU Version 4.3 and 2.139.

Download latest RPU version 4.0
Tags-rpu version 4.0,latest rpu version 4.0,download rpu version 4.0,download latest rpu version 4.0,rpu 4,download rpu 4,latest rpu 4

Jun 27, 2014

ITR 5 java based utility income tax return form for AY 2014-15

6:24 PM 0
The income tax department issued ITR 5 in java based utility for the assessment year 2014-15. Income tax department already issued ITR1 SAHAJ, ITR2, ITR 3, ITR 4 and ITR 4S in java based utility which can work both online and offline mode.

ITR 5- This form is used for filing income tax return by firms, AOPs and BOIs.

How to run the application?
- Ensure that java version 1.7 or more is installed.(version can be identified by executing "java -version" command)
- Unzip and extract the files in the desired path/location.
-----------------------------------------------------------
To run in WINDOWS
-----------------------------------------------------------
Double click ITR.bat
Or
Run from command prompt by executing "ITR.bat" (ensure that current working directory has the extracted files)

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To run in LINUX
-----------------------------------------------------------
Change the ITR.sh file's permission, provide execution permission by executing the following command
> chmod 755 ITR.sh
run using the command "sh ITR.sh" or ./ITR.sh


-----------------------------------------------------------
Troubleshooting
-----------------------------------------------------------
Make sure that your java version is 1.7 (version can be identified by executing "java -version" command)
1. Extract the files to a directory. (Example:  D:\Utility)
2. Open command prompt
3. Change to the extraction directory (cd D:\Utility)
4. Type the following command :
<Path to java executable> -jar <jarFileName>

For example If your Java 7 Installation path is "C:\Program Files (x86)\Java\jre7" and you are opening ITR1 then execute the following command
   

D:\Utility>"C:\Program Files (x86)\Java\jre7\bin\java" -jar ITR-1_AY201415_PR2.jar

Download ITR 5 in java format for assessment year 2014-15
Download ITR 1 SAHAJ and ITR 4S SUGAM in java based utility for assessment year 2014-15
Download ITR 2 in java format for assessment year 2014-15.
Download ITR 3 in java format for assessment year 2014-15.
Download ITR 4 in java format for assessment year 2014-15.
Tags- itr 5,itr 5 in java format,itr 5 ay 2014-15,itr 5 java download,download itr 5 in java format.

ITR 1 SAHAJ excel utility and java based utility for AY 2014-15

5:38 PM 0
The income tax department issued ITR-1 SAHAJ form in excel based utility. Earlier ITR-1 has been issued in java based utility. Income tax department is in hurry to issue income tax forms for the assessment year 2014-15.

ITR-1 ITR 1 SAHAJ form is used by indian individual income tax return.


Download ITR 1 SAHAJ form in excel format
Download ITR 1 SAHAJ form in java format.
Download ITR 2 in excel or java format for assessment year 2014-15
Tags-Download ITR 1 SAHAJ ay 2014-15,Download ITR 1 SAHAJ form assessment year 2014-15,itr 1ay 2014-15,sahaj ay 2014-15,itr 1 in excel ay 2014-15,sahaj form in excel format,sugam form in excel format.

Jun 26, 2014

7 expectation of salaried people with this budget

5:43 PM 0
7 expectation of salaried people with this budget
There are some big expectations by common man with this new government. The first exam of this new government is Budget which will be presented in July 2014. Salaried person have also some expectation with this budget as they can keep more money in their pocket. The 7 expectation of the salaried people with this budget are as follows.

1- Standard deduction on salary- standard deduction is the main expectation of salaried people as standard deduction was allowed in the past. Moreover, expenses are allowed to claim on business income for calculating tax liability. So for uniformity in society, some standard deduction whether on inflation base or percentage basis will be a welcome step.

2- Transport allowance- transport allowance is very much low to Rs. 800 Rs. /month which was fixed in 1998. There is a big change in fuel prices as well as transport costing (recently railway increases fright). So it is expected to increase the transport allowance to Rs. 2000/month.

3- Medical expenses reimbursement- Medical expenses reimbursement by employer is Rs. 15000 per annum which was fixed in 1998. Medical cost has increased very much compare to 1998 and the reimbursement limit should be increased to Rs. 50000 per annum.

4- Children education allowance- Children education and hostel allowance is fixed to the extent of Rs. 100 and Rs. 300 per month per child up to a maximum of 2 Children which was fixed in 2000. Cost of education is also increased highly with a lot of new courses and specialized based education. So this allowance limit is also increased. 

5- Increase in limit of interest paid on housing loan for self-occupied property - Currently, the deduction for interest paid on housing loan taken for a self-occupied property is limited to Rs 1, 50,000 per annum since 2001. However, the real estate cost has increased multifold and consequentially the quantum of housing loan. Considering the increase in the cost of borrowing and current inflation, the eligible amount of deduction may be revisited for all taxpayers. This would result in additional tax savings for taxpayers.

6- Increase in threshold limit under Section 80C - At present, the deduction in respect of a variety of investments under Section 80C is restricted to Rs 1, 00,000. The investments made in various avenues under this section helps the government to raise funds and taxpayers to save tax. However, there are various types of investments which qualify for deduction under this provision with an upper cap of Rs 1, 00,000. Accordingly, in order to encourage enhanced long-term savings and investment, an increase in this limit to a reasonable level would be a welcome change.  

7- Refund and Tax credit - The taxpayers hope that the new finance minister could improve the current tax administration mechanism. Many taxpayers continue to face challenges in getting credit for taxes deducted at source and their tax refunds in time. While the Central Board of Direct Taxes has issued press reports on reduction of time limits in issuance of refunds, and has also adopted technology to improve this process, more can certainly be done on this front. Besides amendment in tax law for this purpose, the systems and procedures too need a thorough revamp to implement expeditious refunds.

8- Last but not the least, the new finance minister may consider increasing the basic exemption limit and change in tax slab in line with the tax rate proposed by the Parliamentary Standing Committee on Finance in its report on Direct Taxes Code 2010 (DTC Bill).The expected tax structure is as follows.

Income tax slabs expected
Tax rate
Upton Rs. 300000
Nil

300001 to 10 lakh
10%
1000001 to 20 lakh
20%
Above Rs.20 Lakh
30%
These are 7 main expectations of salaried people with this new government which promised to bring good days. 

Aggregated TDS compliance at organization PAN level

2:44 PM 0
Aggregated TDS compliance at organization PAN level
In our endeavor to facilitate improved TDS administration, CPC(TDS) feels glad to provide you with the feature of "Aggregated TDS Compliance" at PAN level for all TANs associated with the referenced PAN. Following are additional details related to the new feature.

What is meant by Organization's PAN :
The above indicates the PAN of an entity, having more than one TANs of its branches, associated with the referenced PAN. This will be the PAN of the Central Office, Headquarter etc., as may be appropriate. The said PAN must review the "Aggregated TDS Compliance" report on a regular basis to improve TDS compliance at Organization level.

What does the new feature offer :
The above stated PAN can view TDS performance for all of its respective TANs by logging into TRACES as a Taxpayer.

The Defaults generated for all the TANs can be viewed by using the feature. The following type of Defaults for the branches can be viewed:

Total Default

Short Payment Default

Short Deduction Default

Interest on Payment Default u/s 201

Interest on Deduction Default u/s 201

Late Filing Fee u/s 234E

Interest u/s 220(2)

PAN Errors

The respective TANs with Defaults in their TDS Statements can be pursued to get the above resolved by taking following actions:

Carrying out necessary corrections in the records reported in the TDS statements,

Paying the outstanding demand and

Submitting the Correction Statements at the earliest.

The feature thus provides for a summary of Defaults, which assists in effective TDS administration, monitoring, control and compliance at Organization level.

The feature will be extremely useful for the purpose of complying with the provisions of Section 40(a)(ia) of the Income Tax Act, 1961 by the concerned entity,to ensure that correct information is disclosed in paragraph 27A/B of the Tax Audit Report (Form 3CD) u/s 44AB of the Act.

How to use the feature :
You are requested to Log in to TRACES as a Taxpayer, using your credentials

Navigate to Aggregated TDS Compliance menu on the webpage.

Choose the views according to Financial Year (Download Option 1) or Default Type (Download Option 2) from the drop down lists.

PDF or html views are available for the entity having less than 25 TANs. For larger number of TANs, a download request needs to be submitted.

Submit the Request to generate a Request Number.

The submitted request will be made "Available" in MS Excel format, under "Requested Downloads" in the "Download" menu.

The report will be "Not Available" if there are No Defaults or there are statements yet to be processed. If you believe that either of the two is not true, the same can be reported to CPC (TDS).

The feature provides for the above information for Financial Year 2007-08 onwards.

The steps to use the functionality are easy and convenient, however, e-Tutorials for the above release will shortly be made available on the portal.You can reach out to us on ContactUs@tdscpc.gov.in or call our toll-free number 1800 103 0344.

CPC (TDS) is committed to provide best possible services to you.

Jun 25, 2014

Consistently invalid/Not available PAN while submitting TDS statements

4:06 PM 0
Consistently invalid/Not available PAN while submitting TDS statements
 CPC(TDS) has observed from its records that you have consistently reported Invalid / Not Available PANs in the Quarterly TDS Statements submitted during the period from Q4, 2012-13 to Q3,2013-14. Please note that you are amongst deductors, who have reported highest number of above mentioned incorrect PAN records in their TDS Statements.

Please refer to the following details with respect to Invalid PANs reported in your TDS Statements:

Deductor's 
TAN
Count of PAN Errors 
Q4,2012-13
Count of PAN Errors 
Q1,2013-14
Count of PAN Errors 
Q2,2013-14
Count of PAN Errors 
Q3,2013-14

Implications of reporting Invalid/ Not Available PANs in TDS Statements :
Deductor will not be able to provide TDS certificate to the deductee, if valid PANs are not reported.
The correct deductee will not be able to avail the credit of TDS deducted for taxes deducted.

Under section 277 of the Income Tax Act, 1961, if a person makes a statement in any verification under this Act or under any rule made there under, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, is punishable.

Actions to be taken :
Please note that Correct reporting at the first instance will help in avoiding submitting Correction Statements.
In case of any errors observed in reporting, the Corrections must be reported at the earliest to avoid unwarranted delays.

The Deductor must ensure that the PANs for deductees reported in TDS Statements are valid and correct. TAN-PAN Master can be downloaded from TRACES and should be used to file statements to avoid quoting of incorrect PANs
.
Please Login to TRACES and navigate to "Dashboard"to locate "PAN Verification" in the Quick Links menu. The functionality to download Consolidated TAN - PAN File has also been provided that includes all the PANs attached with the respective TANs. Please refer to e-tutorials for assistance.

It is advised to avoid submitting TDS Statements with Invalid PANs and take corrective actions at the earliest.

CPC (TDS) is committed to provide best possible services to you.

Correction statements filed for Valid PAN changes after over an year

3:59 PM 0
Correction statements filed for Valid PAN changes after over an year
CPC(TDS) has observed from its records that you have filed correction statements, which include updations from Valid to Valid PANs, after a significant delay of over an year.

Implications of reporting incorrect Deductees in TDS Statements:
The Deductor will not be able to provide TDS certificate within specified time period to correct deductee.
The correct deductee will not be able to avail the credit of TDS deducted in the same financial year, in which the tax has been deducted.

Under section 277 of the Income Tax Act, 1961, if a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true is punishable and shall be deemed to be an assessee in default.

Actions to be taken:
Please note that there are limited opportunities for Valid to Valid PAN Corrections. Correct reporting at the first instance will help in avoiding submitting Correction Statements.

In case of any errors observed in reporting, the Corrections must be reported at the earliest to avoid unwarranted delays.

The Deductor must ensure that the PANs for deductees reported in TDS Statements are valid and correct. TAN-PAN Master can be downloaded from TRACES and should be used to file statements to avoid quoting of incorrect PANs. 

Please Login to TRACES and navigate to "Dashboard" to locate "PAN Verification" in the Quick Links menu. The functionality to download Consolidated TAN - PAN File has also been provided that includes all the PANs attached with the respective TANs.

You can use the facility of Online Corrections at TRACES with Digital Signature to correct PANs. Please refer to e-tutorials for assistance.

It is advised to refrain from submitting corrections after significant delay, including changes from Valid to Valid PANs.

CPC (TDS) is committed to provide best possible services to you.

Jun 24, 2014

New Wealth tax form BB and amendment rules 2014

5:38 PM
New Wealth tax form BB and amendment rules 2014
Income tax department notified new wealth tax form BB which is mandatory to file except individual and HUF not liable for tax audit. Income tax department issued notification no. 32 dated 23 June 2014 regarding wealth tax 1st amendment rules 2014. Full notification is as under.

In exercise of the powers conferred by clause (ba) and clause (bb) of sub-section (2) of section 46 read with section 14A and section 14B of the Wealth-tax Act, 1957 (27 of 1957), the Central Board of Direct Taxes hereby makes the following rules further to amend the Wealth-tax Rules, 1957, namely:—
1. (1) These rules may be called the Wealth-tax (First Amendment) Rules, 2014.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Wealth-tax Rules, 1957 (hereinafter referred to as the "said rules"),—
(i) for rule 3, the following rule shall be substituted, namely:—
"3. FORM OF RETURN OF NET WEALTH.—(1) The return of net wealth referred to in section 14 shall—
(a) in respect of assessment year 2013-14 and earlier assessment years in the case of individuals, Hindu undivided families and companies, be in Form BA and shall be verified in the manner specified therein.
(b) in respect of the assessment year 2014-15 and any other subsequent assessment year in the case of individuals, Hindu undivided families and companies be in Form BB and shall be verified in the manner specified therein.
(2) Subject to the provisions of sub-rule (3), for the assessment year 2014-15 and any other subsequent assessment year, the return of net wealth referred to in sub-rule (1) shall be furnished electronically under digital signature.
(3) In case of individual or Hindu undivided family to whom the provisions of section 44AB of the Income-tax Act, 1961 (43 of 1961) are not applicable, the return of net wealth referred to in sub-rule (1) may be furnished for assessment year 2014-15 in a paper form.
(4) The return of net wealth required to be furnished in Form BB shall not be accompanied by a statement showing the computation of the tax payable on the basis of the return, or proof of the tax and interest paid, or any document or copy of any account or form of report of valuation by registered valuer required to be attached with the return of net wealth under any provisions of the Act.
(5) The Director General of Income-tax (Systems) shall specify the procedures, formats and standards for ensuring secure capture and transmission of data and shall also be responsible for evolving and implementing appropriate security, archival and retrieval policies in relation to furnishing the returns in the manners specified in sub-rule (2)."
3. In the said rules, in Appendix, after Form BA, the following Form shall be inserted
Download Form BB
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New hybrid and future value transaction feature in RTGS

5:29 PM 0
New hybrid and future value transaction feature in RTGS
Please refer to our circular DPSS (CO) RTGS No.801/04.04.017/2013-14 dated October 11, 2013 regarding the launch of new RTGS system and coming into effect of “RTGS System Regulations 2013”. A reference is also invited to Chapter 9 of the “RTGS System Regulations 2013” wherein it had been indicated that the new features in RTGS system will be enabled after due notifications to members.

2. The new RTGS system has been running smoothly and has stabilised. It has hence been decided to enable the ‘Hybrid’ and ‘Future value dated transaction’ features in the system with effect from July 14, 2014. The details regarding operations of these two functionalities are given in Annex.

3. The Hybrid feature will be configured to do off-setting every 5 minutes. The transactions with normal priority would be settled in off-setting mechanism, with a maximum of two attempts i.e. the maximum time a transaction would be in “normal” queue is 10 minutes. If the transactions with normal priority are unable to be settled in offsetting mode within this time, the priority of the transaction would be automatically changed to “urgent”. The parameter value will be set to 10%. This means that 10% of the balance in the settlement A/c would be taken for settlement in the offsetting mode.

4. The Future Value dated Transaction would enable the customers / participants to initiate RTGS transactions 3 working days in advance for settling in RTGS on value date.

5. The circular is issued under section 10 (2) of Payment and Settlement Systems Act 2007, (Act 51 of 2007).
Yours faithfully,
Vijay Chugh
Chief General Manager
Encl: As above.

Annex
1. Hybrid feature
a) The RTGS system supports a new and unique way to handle large volume of payments using a minimum amount of liquidity from the Participants’ settlement accounts.
b) From the priority point of view, the RTGS system can handle two types of payments:
  1. Urgent payments
  2. Normal payments
c) Both categories are implemented over the same ISO20022 standard and share the same rules and regulations. However, while the urgent payments are processed as soon as they are received by the RTGS and using as much liquidity as required from the settlement account of the sending Participant, the normal payments are processed differently, following some strict processing rules which do not apply to the urgent payments. These rules are:
  1. The normal payments are not settled immediately, even though the sending bank may have sufficient funds in its settlement account;
  2. The normal payments may settle only at periodic time intervals which are controlled centrally by system parameter of RTGS;
  3. The RTGS does not take into consideration the pending normal transactions in the calculation for IDL funding request to CBS;
  4. The settlement of normal payments can occur only if several participants, simultaneously, have sent normal payments to each other. If 0 % of allowance is set in parameter value (centrally), in that scenario the transactions would look for settling transactions without using any amount from the settlement account, i.e., settlement will happen purely on offsetting mode. If an allowance of 1% is set in the parameter in that scenario, the transactions would try to settle using a percentage of the amount from the settlement account.
  5. If the condition for the settlement of normal payments is not possible, the system will automatically promote the normal payments to the urgent payment stream, after a predefined timeout parameter. Once promoted, the transactions will be processed according to the urgent payments’ settlement rules.
  6. From the format point of view, the field that designates a payment as normal or urgent is called InstrPrty and its content should be:
    • NORM – for normal payments
    • HIGH – for urgent payments
Process flow
The normal payments will have the following flow in RTGS:
1. A new normal message is received, validated and (if successful) placed in the ENTER status queue.

2. The item will stay with status ENTER until the first gridlock cycle for the normal stream runs. After the cycle is completed, the item will change its status to COMPLETE (if the item was settled) or PENDING (if the item was not included in any gridlock solution).

3. Subsequent gridlock cycles will attempt to settle the item (every 5 minutes), considering other normal payments found in the system. If a solution is found by the normal payment stream gridlock resolution process, the respective transactions are updated to status COMPLETE and the respective output messages are generated to the sender and receiver.

4. If a solution is not found within the timeout period (10 minutes) for the normal payments, the item is promoted to the urgent stream. The change is visible to the end user when listing the transaction and also in the audit trail of the item.

5. Once the transaction is promoted to urgent, if the sending Participant does not have the required liquidity, the IDL funding may be invoked depending on the TTC of the item.
Example
The following table demonstrates how this feature will work. T1, T2, T3 etc. indicates the transaction initiated by banks. The bank initiating the transaction is debited and beneficiary bank is credited.
Normal Transaction in queue
Initiating Bank
( Debit)
Recipient Bank
(Credit)
Amount
T1AB
5,00,000
T2BC
4,80,000
T3CA
4,60,000
T4BC
1,00,000
T5CA
1,10,000
The following table explains how these transactions would be settled in off-setting mode when no liquidity is used from the settlement account of the banks or when a percentage of the amount in the settlement account is used for settling the transactions in offsetting mode. The parameter value indicates the percentage of the liquidty, that can be used for settlement of the transactions in offsetting mode (transactions with normal priority).
Example
Parameter Value
Settlement Account
Settled Transaction
Used Liquidity from A
Used Liquidity from B
Used Liquidity from C
Balance of Bank A
Balance of Bank B
Balance of Bank C
1
0%10,00,00010,00,00010,00,0000000
2
5%10,00,00000T1,T2,T340,00000
3
10%10,00,00010,00,00010,00,000T1,T2,T3,T4,T5080,0000
In the example 1 the parameter value is set to 0% i.e. no amount will be utilised from the settlement account to settle these transactions. Hence, none of the above transactions listed (T1, T2, T3, T4 and T5 will be settled) as there is no transaction with equal value to offset (settle) the transaction.

In example 2, the parameter value is set to 5%. The maximum amount which can be used from the settlement account is Rs.50,000 (i.e.5% of Rs. 10,00,000). The transaction T1, T2 and T3 are settled. Though the maximum which can be used from settlement account is Rs.50,000 the actual amount utilised from A’s settlement account is 40,000 to settle these transactions. i.e. Rs.40,000 is utilised to settle transactions T1, T2 and T3 amounting to Rs.14,40,000. However, transaction T4 and T5 could not be settled as liquidity requirement for settling these transactions was more than Rs.50,000.

In example 3 the parameter value is set to 10%. The maximum amount which can be utilised from the settlement account for settlement of the transactions with normal priority is Rs. 1,00,000. In this case, all the transactions listed (T1, T2, T3, T4 and T5) are settled by usitlising Rs.80,000 from settlement account of B.

2. Future Value Transactions
1. This feature will allow Participants to send RTGS payments which are not submitted for settlement immediately, but at a later date. This option will facilitate the scheduling of certain important payments days in advance.

2. The RTGS will not attempt to settle them immediately but it will wait until the respective value date is reached.

3. The value date must be within a certain time period which is controlled by system parameter of the application (3 working days). When sending a future value payment, the sender must ensure that the respective value date is a working date according to the present RTGS calendar. If the value date is set on a non-working date, the payment will be rejected immediately.

4. A future value dated transaction can be manually canceled at any time, as long as its status is FUTURE, from the Settlement / Transaction / Cancel menu option. (The cancel operations requires an approve confirmation.)

5. When a Participant is removed, any future value payments already sent by the said participant and stored in RTGS will be automatically canceled. The sender will be notified about the cancelation using standard notification messages.

6. If the calendar of RTGS is modified by RBI and as a result some future value payments already present in the system have their value date falling on a non-working date, the respective transactions will not be canceled. The items will remain in the system and they will be submitted to the settlement process on the first working day following the original value date.

Income tax department urges taxpayers to update contact information immediately

5:10 PM 0
Income tax department urges taxpayers to update contact information immediately
Income-Tax Department uses the registered contact details (Mobile number & E-mail ID) for all communications related to e-Filing. It is mandatory that all tax payers must have a valid contact details registered in e-Filing portal.

It is noticed that many registered users are not having authenticated contact details in e- Filing or may have provided details of other persons for convenience. This prevents the Department from interacting directly with taxpayers on their personal email and Mobile.

Further, it has been observed that in many cases taxpayers are not able to resettheir password since the email communication from the Department may be sent to their registered email or Mobile which may be different from the taxpayer’s personal email or mobile.

Hence, it is requested that all the e-Filing users may immediately update and authenticate their correct contact details so that the communication can be sent to the valid Mobile number and E-mail ID.
The process of updating and authenticating the contact details are below.
New users
Provide the correct Mobile Number and Email ID during the Registration in the e-Filing portal, Activation link would be sent to the registered E-mail ID and a One Time Password (OTP also called PIN) is sent to the registered Mobile Number. User needs to Click on the Link provided in the E-mail and enter the OTP received in the mobile number for Successful activation of the registered user in e-Filing portal.
Registered Users
After the user logs in to the e-filing account, there will be a pop-up requesting user to update the current Mobile number and E-mail ID. The user should update their personal Mobile number and Email so that the updated contact particulars are registered with the Department or confirm that the Mobile number and email ID already registered is their valid personal contacts.
Upon submitting the details, Department would immediately send OTPs (PIN1 & PIN2) to new mobile number and Email ID. The respective PINs- PIN1 and PIN2 received through Mobile number and E-mail ID should be entered by them in the respective input fields to authenticate that the email ID and mobile are correct. Upon successful validation the Mobile number and email ID would be updated in the taxpayer’s profile and the process would be complete.
The PIN1 and PIN2 would be valid only for the session – so taxpayers are advised not to close the webpage till PINs are entered and validated. In case of any difficulty or delay, the taxpayer can log in again and follow the same process to update the current contact details.
Note
Taxpayers are advised to follow the process mentioned above in the interest of the security of their e-filing account and to directly receive communication from the Department about status of processing and issue of refunds etc.
This is a one-time process to validate the mobile number and email ID. However, whenever the taxpayer changes the Mobile Number or email ID in their Profile, the process will be repeated to ensure that the particulars provided are correct.
One mobile number or email ID can be used for a maximum of 4 user accounts as the Primary Contact- Mobile Number and Email ID in e-Filing.This is to ensure that family members (not exceeding 4 separate users) not having personal email or mobile can be covered under a common email or mobile, but in general taxpayers should have their own unique email ID and Mobile registered with the Department.
The taxpayer can enter any other person’s email or mobile number in addition as a Secondary Contact (without any restriction on the number of user accounts linked as a Secondary Contact). Using “Profile Settings My Profile” the taxpayer can select to include the Secondary Contact to also receive emails, alerts etc.
Include the emails and SMS from the Income tax Department in the ‘safe list’ or ‘white list’ to prevent the communications from the Department from being blocked or rejected or sent to Spam folder.
As a best practice, please update and authenticate the current contact and address details under “Profile Settings My Profile” after login to eFiling portal.

Jun 22, 2014

Treat taxpayers as customers and avoid refunds-Tax panel to revenue

11:00 PM 4
Treat taxpayers as customers and avoid refunds-Tax panel to revenue
 The particular practice of slowing down tax refunds through the revenue department possesses drawn sharp critique from Tax Current administration Reforms Commission (TARC), which in turn said such delays have to put out an inequitable demand on good taxpayers.

The particular commission, chaired by simply Parthasarathi Shome, remarked that revenue targets which can be blind to the actual changing economic scenario bring about tax gaps, that happen to be mostly addressed through the authorities by placing pressure on taxpayers to help contribute more or by postponing refunds which can be due, especially in the last quarter of the actual fiscal.

“Such policies could well be illegal in various other law-abiding societies, ” the commission said throughout its report, adding that current tax regimes don't use 'static' earnings targets.

The effect, unsurprisingly, is two fold -- first, a dearth of substantial tax policy or tax administration coverage and, second, an inequitable pressure within the good taxpayer, Shome said inside the report.

The report also said that the practice of slowing down refunds by asking for irrelevant information seemed to be undesirable and non-transparent.

The commission pressed the revenue department to take into consideration taxpayers as customers and recommended which 10% of its funds needs to be dedicated for supplying taxpayer services. In addition, it suggested that the procedure of conducting seek and seizure needs to be made more specialist.

“The shifting regarding focus to taxpayer like a customer and attending his grievance is incredibly significant and needs a transformation inside the approach of earnings authorities. The government should policy for implementation of the actual report, ” explained Sekar K Third, partner, tax, Deloitte Haskins & Carries.

The commission additionally strongly recommended periodical article on rules, regulations as well as other tax policy measures including exemptions to see whether they remain relevant towards the prevailing socio-economic disorders. In this situation, it recommended that the government should build in the sunset clause in every rule and regulation.

In order to make tax administration more potent, the commission encouraged that lateral admittance of experts needs to be allowed in specialised areas under a five year contract. Also, to enhance the dispute resolution process, the present composition of commissioner (appeals) needs to be changed to a couple forums--single commissioner (appeals) and also a three-member commissioner (appeals) cell, it said.

Jun 20, 2014

ITR 2 excel utility and java based utility for Asst year 2014-15

10:30 PM 0
The income tax department issued ITR 2 income tax return form in excel utility for the assessment year 2014-15. Earlier ITR 2 is also released in java based utility. You can download any or both format of utilities of ITR 2 for the assessment year 2014-15.

ITR 2-This Return Form is to be used by an individual or a Hindu Undivided Family whose total income for the assessment year 2012-13 includes:-

(a) Income from Salary / Pension; or
(b) Income from House Property; or 
(c) Income from Capital Gains; or 
(c) Income from Other Sources (including Winning from Lottery and Income from Race Horses).
Further, in a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used where such income falls in any of the above categories.

Who cannot use this Return Form

This Return Form should not be used by an individual whose total income for the assessment year 2012-13 includes Income from Business or Profession.


Download ITR 2 excel based utility for assessment year 2014-15.
Download ITR 2 java based utility for assessment year 2014-15.
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