ANALYSIS OF TCS PROVISIONS [applicable w.e.f. 01/06/2016]
SECTION 206C
(1D) Every person, being a seller, who receives any amount in cash as consideration for sale of bullion 35[***] or jewellery, or any other goods (other than bullion or jewellery) or providing any service, shall, at the time of receipt of such amount in cash, collect from the buyer, a sum equal to one per cent of sale consideration as income-tax, if such consideration,—
SECTION 206C
(1D) Every person, being a seller, who receives any amount in cash as consideration for sale of bullion 35[***] or jewellery, or any other goods (other than bullion or jewellery) or providing any service, shall, at the time of receipt of such amount in cash, collect from the buyer, a sum equal to one per cent of sale consideration as income-tax, if such consideration,—
(i) for bullion, exceeds two hundred thousand rupees; or
(ii) for jewellery, exceeds five hundred thousand rupees; or
(iii) for any goods, other than those referred to in clauses (i) and (ii), or any service, exceeds two hundred thousand rupees:
Provided that no tax shall be collected at source under this subsection on any amount on which tax has been deducted by the payer under Chapter XVII-B.
(1E) Nothing contained in sub-section (1D) in relation to sale of any goods (other than bullion or jewellery) or providing any service shall apply to such class of buyers who fulfill such conditions, as may be prescribed.
(1F) Every person, being a seller, who receives any amount as consideration for sale of a motor vehicle of the value exceeding ten lakh rupees, shall, at the time of receipt of such amount, collect from the buyer, a sum equal to one per cent of the sale consideration as income-tax.
any company or
firm or
co-operative society and
also includes an individual or a Hindu undivided family whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which the goods of the nature specified in the Table in sub-section (1) or sub-section (1D) are sold or services referred to in sub-section (1D) are provided.
· TCS @ 1% to be collected even if no PAN is provided by the Purchaser. In that case Form 60 to be obtained from the Purchaser and Return in Form 61 also to be filed (if Tax Audit applicable).
· Deduction at higher rate in case PAN not available (Section 206AA) is not applicable for TCS.
· Requirement of quoting PAN shall not apply to Central Government, State Government and the Consular Offices. However this exemption is not available for Local authorities, Improvement Trust, Development Boards
b) Sale of purchase of immovable property where PAN to be quoted for amount > 10 lacs.
c) Sale or Purchase of Securities (other than shares) where PAN to be quoted for transactions > Rs. One lac.
d) Sale of purchase of shares of unlisted Company where PAN to be quoted for transactions > Rs. One lac.
e) Purchase of foreign currency in cash where PAN to be quoted for payment exceeding Rs. 50000 at any one time.
f) Purchase of units of Mutual funds from issuing mutual fund where PAN to be quoted for payment exceeding Rs. 50000.
g) Purchase of debentures or bonds from issuing company where PAN to be quoted for payment exceeding Rs. 50000
h) Purchase of RBI Bonds from RBI where PAN to be quoted for payment exceeding Rs. 50000
i) Payment in cash for services to Hotel or restaurant against a bill exceeding Rs. 50,000 at any one time.
j) Payment in cash for services in connection with foreign travel exceeding Rs. 50000 at any time.
1. Limit of two lacs shall apply whether transaction is conducted in cash or cheque. However for payments to Hotel, restaurants, payments for foreign travel, foreign exchange while limit for cash transactions is Rs. 50,000, limit for non cash transactions only shall be two lacs.
2. PAN Reporting requirements is applicable for Goods/Services if Invoice Exceeds Rs. 2 lacs (whether payment received in cash or otherwise). However TCS applicable if any amount is received in cash.
3. In case of Motor Vehicles (other than 2 wheelers), PAN is to be quoted irrespective of the amount or mode of payment, but TCS applicable if value exceeds Rs.10 lacs (cash or non-cash)
4. A person who does not have PAN and enters into transaction specified in R. 114B shall make a declaration in F.60. Old Form 60 has been replaced with new Form 60. Earlier Form 61 which pertained to perons having agriculture income only has been rescinded and replaced with statement in Form 61 for providing information to the department.
5. Form 60 is required to be retained for six years from end of financial year (not assessment year) in which transaction is under taken. E.g. transaction for AY 2016-17 is undertaken in FY 2015-16, then Form 60 to be retained till 31-03-2022.
6. Form 61 statement required to furnished electronically by 30th April and 31st October for declarations received till 31st March and 30th September. For period 01/01/2016 to 31/03/2016, the date has been extended to 31st October 2016.
7. U/R 114C(2) , seller issuing bill to ensure after verification that PAN has been correctly furnished and mentioned in the document or that F.60 has been duly furnished with complete particulars where PAN is not available.
8. However all such sellers are not required to electronically furnish data about F. 60 to the department and it is only where audit is required u/s 44AB (including audit for presumptive taxation) that data is required to be furnished electronically in F. 61 besides retaining F.60 for six years from end of financial year.
9. Seller of Immovable Property and Seller of Motor Vehicles have to electronically furnish data in Form 61 (whether Tax Audit applicable or not)
2. Payments made in cash aggregating to ten lakh rupees or more during the financial year for purchase of pre-paid instruments issued by Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007 (51 of 2007).
3. Cash deposits or cash withdrawals (including through bearer’s cheque) aggregating to fifty lakh rupees or more in a financial year, in or from one or more current account of a person
4. Cash deposits aggregating to ten lakh rupees or more in a financial year, in one or more accounts (other than a current account and time deposit) of a person.
5. One or more time deposits (other than a time deposit made through renewal of another time deposit) of a person aggregating to ten lakh rupees or more in a financial year of a person.
6. Payments made by any person of an amount aggregating to-
(i) one lakh rupees or more in cash; or
(ii) ten lakh rupees or more by any other mode,
against bills raised in respect of one or more credit cards issued to that person, in a financial year.
7. Purchase or sale by any person of immovable property for an amount of thirty lakh rupees or more or valued by the stamp valuation authority referred to in section 50C of the Act at thirty lakh rupees or more.
8. Receipt of cash payment exceeding two lakh rupees for sale, by any person, of goods or services of any nature
· Last Date of filing Annual Information Return which was earlier 31st August, now it will be 31st May of the succeeding Financial Year.
· For Delay in filing Annual Information Return, penalty @ 100/- per day for default can be imposed
2. Responsibility of Seller and Registering officer to ensure PAN is duly and correctly mentioned, or declaration in Form 60 duly furnished with complete particulars.
3. Seller to file online Form 61, (if PAN of Purchaser not mentioned). Liability of seller even if not liable to Tax Audit.
4. AIR Reporting liability is of Inspector General/Registrar/Sub-Registrar
2. PAN to be quoted if invoice more than 2 lacs (whether cash or otherwise).
3. AIR Reporting applicable if Cash Receipt more than 2 lacs.
4. Filing Form 61 and AIR Reporting applicable only for Tax Audit cases (including Audit u/s 44AD presumptive taxation)
2. PAN to be quoted irrespective of the amount. Responsilbility of Seller to ensure PAN is duly and correctly mentioned, or declaration in Form 60 duly furnished with complete particulars.
3. Seller to file online Form 61, (if PAN of Purchaser not mentioned). Applicable to seller even if not liable to Tax Audit.
4. TCS Applicable if Sale Consideration > 10 lacs, and Seller is Firm/Co/Co-op Society. TCS on Sale of Motor Vehicle not applicable if Seller is Individual/HUF.
· An authorized user will be created and the a new user –id of the authorized user will be created.
· Same user-id will be used to upload Form 61 and 61A on the IT E-filing website.
Disclaimer:
(ii) for jewellery, exceeds five hundred thousand rupees; or
(iii) for any goods, other than those referred to in clauses (i) and (ii), or any service, exceeds two hundred thousand rupees:
Provided that no tax shall be collected at source under this subsection on any amount on which tax has been deducted by the payer under Chapter XVII-B.
(1E) Nothing contained in sub-section (1D) in relation to sale of any goods (other than bullion or jewellery) or providing any service shall apply to such class of buyers who fulfill such conditions, as may be prescribed.
(1F) Every person, being a seller, who receives any amount as consideration for sale of a motor vehicle of the value exceeding ten lakh rupees, shall, at the time of receipt of such amount, collect from the buyer, a sum equal to one per cent of the sale consideration as income-tax.
· "seller" means
the Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, orany company or
firm or
co-operative society and
also includes an individual or a Hindu undivided family whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which the goods of the nature specified in the Table in sub-section (1) or sub-section (1D) are sold or services referred to in sub-section (1D) are provided.
· TCS @ 1% to be collected even if no PAN is provided by the Purchaser. In that case Form 60 to be obtained from the Purchaser and Return in Form 61 also to be filed (if Tax Audit applicable).
· Deduction at higher rate in case PAN not available (Section 206AA) is not applicable for TCS.
RULES 114B, 114C, 114D [Applicable w.e.f. 01/01/2016]
· PAN to be quoted in all the documents pertaining to specified transactions.· Requirement of quoting PAN shall not apply to Central Government, State Government and the Consular Offices. However this exemption is not available for Local authorities, Improvement Trust, Development Boards
For General Transactions of Sale or Purchase of Goods or Services of any nature PAN to be quoted where amount exceeds Rs. Two lacs per transaction excluding following transactions :
a) Sale or purchase of motor vehicle where PAN to be quoted irrespective of amountb) Sale of purchase of immovable property where PAN to be quoted for amount > 10 lacs.
c) Sale or Purchase of Securities (other than shares) where PAN to be quoted for transactions > Rs. One lac.
d) Sale of purchase of shares of unlisted Company where PAN to be quoted for transactions > Rs. One lac.
e) Purchase of foreign currency in cash where PAN to be quoted for payment exceeding Rs. 50000 at any one time.
f) Purchase of units of Mutual funds from issuing mutual fund where PAN to be quoted for payment exceeding Rs. 50000.
g) Purchase of debentures or bonds from issuing company where PAN to be quoted for payment exceeding Rs. 50000
h) Purchase of RBI Bonds from RBI where PAN to be quoted for payment exceeding Rs. 50000
i) Payment in cash for services to Hotel or restaurant against a bill exceeding Rs. 50,000 at any one time.
j) Payment in cash for services in connection with foreign travel exceeding Rs. 50000 at any time.
1. Limit of two lacs shall apply whether transaction is conducted in cash or cheque. However for payments to Hotel, restaurants, payments for foreign travel, foreign exchange while limit for cash transactions is Rs. 50,000, limit for non cash transactions only shall be two lacs.
2. PAN Reporting requirements is applicable for Goods/Services if Invoice Exceeds Rs. 2 lacs (whether payment received in cash or otherwise). However TCS applicable if any amount is received in cash.
3. In case of Motor Vehicles (other than 2 wheelers), PAN is to be quoted irrespective of the amount or mode of payment, but TCS applicable if value exceeds Rs.10 lacs (cash or non-cash)
4. A person who does not have PAN and enters into transaction specified in R. 114B shall make a declaration in F.60. Old Form 60 has been replaced with new Form 60. Earlier Form 61 which pertained to perons having agriculture income only has been rescinded and replaced with statement in Form 61 for providing information to the department.
5. Form 60 is required to be retained for six years from end of financial year (not assessment year) in which transaction is under taken. E.g. transaction for AY 2016-17 is undertaken in FY 2015-16, then Form 60 to be retained till 31-03-2022.
6. Form 61 statement required to furnished electronically by 30th April and 31st October for declarations received till 31st March and 30th September. For period 01/01/2016 to 31/03/2016, the date has been extended to 31st October 2016.
7. U/R 114C(2) , seller issuing bill to ensure after verification that PAN has been correctly furnished and mentioned in the document or that F.60 has been duly furnished with complete particulars where PAN is not available.
8. However all such sellers are not required to electronically furnish data about F. 60 to the department and it is only where audit is required u/s 44AB (including audit for presumptive taxation) that data is required to be furnished electronically in F. 61 besides retaining F.60 for six years from end of financial year.
9. Seller of Immovable Property and Seller of Motor Vehicles have to electronically furnish data in Form 61 (whether Tax Audit applicable or not)
ANNUAL INFORMATION RETURN and REPORTING (RULE 114E) [applicable w.e.f. 01/04/2016]
1. Payment made in cash for purchase of bank drafts or pay orders or banker’s cheque of an amount aggregating to ten lakh rupees or more in a financial year.2. Payments made in cash aggregating to ten lakh rupees or more during the financial year for purchase of pre-paid instruments issued by Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007 (51 of 2007).
3. Cash deposits or cash withdrawals (including through bearer’s cheque) aggregating to fifty lakh rupees or more in a financial year, in or from one or more current account of a person
4. Cash deposits aggregating to ten lakh rupees or more in a financial year, in one or more accounts (other than a current account and time deposit) of a person.
5. One or more time deposits (other than a time deposit made through renewal of another time deposit) of a person aggregating to ten lakh rupees or more in a financial year of a person.
6. Payments made by any person of an amount aggregating to-
(i) one lakh rupees or more in cash; or
(ii) ten lakh rupees or more by any other mode,
against bills raised in respect of one or more credit cards issued to that person, in a financial year.
7. Purchase or sale by any person of immovable property for an amount of thirty lakh rupees or more or valued by the stamp valuation authority referred to in section 50C of the Act at thirty lakh rupees or more.
8. Receipt of cash payment exceeding two lakh rupees for sale, by any person, of goods or services of any nature
· Last Date of filing Annual Information Return which was earlier 31st August, now it will be 31st May of the succeeding Financial Year.
· For Delay in filing Annual Information Return, penalty @ 100/- per day for default can be imposed
Major Provisions for Business/Profession
In case of Immovable Property,
1. AIR Reporting required if value exceeds Rs. 30 lacs, but PAN to be quoted if value exceeds Rs. 10 lacs.2. Responsibility of Seller and Registering officer to ensure PAN is duly and correctly mentioned, or declaration in Form 60 duly furnished with complete particulars.
3. Seller to file online Form 61, (if PAN of Purchaser not mentioned). Liability of seller even if not liable to Tax Audit.
4. AIR Reporting liability is of Inspector General/Registrar/Sub-Registrar
In case of Goods/Services
1. TCS applicable if any amount is received in cash , if invoice > 2 lacs. Applicable to all Firms/Companies/Co-op Society. Applies to Indl/HUF only if Sale in preceding year > 1 crore.2. PAN to be quoted if invoice more than 2 lacs (whether cash or otherwise).
3. AIR Reporting applicable if Cash Receipt more than 2 lacs.
4. Filing Form 61 and AIR Reporting applicable only for Tax Audit cases (including Audit u/s 44AD presumptive taxation)
In case of Sale of Motor Vehicle (Other than Two Wheelers)
1. AIR Reporting required if cash receipt exceeds Rs. 2 Lakhs. (If Seller liable for Tax Audit).2. PAN to be quoted irrespective of the amount. Responsilbility of Seller to ensure PAN is duly and correctly mentioned, or declaration in Form 60 duly furnished with complete particulars.
3. Seller to file online Form 61, (if PAN of Purchaser not mentioned). Applicable to seller even if not liable to Tax Audit.
4. TCS Applicable if Sale Consideration > 10 lacs, and Seller is Firm/Co/Co-op Society. TCS on Sale of Motor Vehicle not applicable if Seller is Individual/HUF.
Penalty for Non Compliance
272B. (1) If a person fails to comply with the provisions of section 139A, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ten thousand rupees.For Filing Form 61 and Form 61A, create authorized user in E-filing website
· On menu “Manage ITDREIN”· An authorized user will be created and the a new user –id of the authorized user will be created.
· Same user-id will be used to upload Form 61 and 61A on the IT E-filing website.
Disclaimer:
The contents of this blog are solely for informational purpose. It does not constitute professional advice or recommendation of the author. Neither the authors nor firm and its affiliates accept any liabilities for any loss or damage of any kind arising out of any information in this blog nor for any actions taken in reliance thereon.
Readers are advised to consult the professional for understanding applicability of these provisions. While due care has been taken in preparing this blog, the existence of mistakes and omissions herein is not ruled out. No part of this blog should be distributed or copied (except for personal, non-commercial use) without our written permission.
Readers are advised to consult the professional for understanding applicability of these provisions. While due care has been taken in preparing this blog, the existence of mistakes and omissions herein is not ruled out. No part of this blog should be distributed or copied (except for personal, non-commercial use) without our written permission.
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