1
CBDT amends Income-tax Rules relating to TDS procedure
The Central Board of Direct Taxes (“CBDT”) has recently notified the Income-tax (8th Amendment) Rules, 20111 effective from 1 November, 2011, amending the Income-tax Rules, 1962 relating to tax deduction at source (“TDS”) in respect of the following:
• Due date of filing of tax withholding statement by an office of Government [Rule 31A(2)]
1 Notification No. 57/2011/F.No. 142/23/2011-SO(TPL)
S.
No.
Quarter ending Of
the financial
year
Time limit for filing of TDS
return (amended provision)
Time limit for filing of TDS return (current provision)
Impact
1 30 June 31 July of the financial year
15 July of the financial year
Due date extended from 15 July to 31 July 2 30
September
31 October of the financial year
15 October of the financial year
Due date extended from 15 October to 31 October
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News Alert
4 November, 2011
PwC News Alert November 2011
2 S.
No.
Quarter ending Of
the financial
year
Time limit for filing of TDS
return (amended provision)
Time limit for filing of TDS return (current provision)
Impact
3 31 December 31 January of the financial year
15 January of the financial year
Due date extended from 15 October to 31 October
4 31 March 15 May of the next financial year
15 May of the next financial year
No change
• Additional particulars to be furnished in tax withholding statement in case declaration is furnished to the deductor under section 197A(1), 197A(1A) and 197A(1C) [Rule 31A(4)]
Additional/New provision
Existing provision Impact
The particulars of amount paid or credited on which tax was not deducted in view of the furnishing of declaration by the deductee, under section 197A(1), (1A) and (1C)
The particulars of amount paid or credited on which tax was not deducted in view of issue of certificate of no deduction of tax under section 197 by the assessing officer of the payee.
Another situation added in the Income Tax Rules, 1962, in which case the person responsible for withholding tax has to comply with the reporting
requirement.
• Credit of tax given to person other than deductee [Rule 37BA(2)(i)]
Amended provision Existing provision Impact Under the provision of
the Income-tax Act, 1961, where the whole or any part of the income on which tax has been deducted at source is assessable in the hands of a person other than the deductee, credit for the whole or any part of the TDS, as the case maybe, shall be given to the other person and not to the deductee provided that the deductee files a declaration with the deductor and the deductor reports the tax deduction in the name of the other person in the tax withholding statement.
The credit of TDS was given to a person other than the deductee if income on which tax was deducted was assessable in the hands of the other person in specified cases covered under sections 60, 61, 93, 94 or special cases of assessment of HUFs, AOP, Trusts, etc.
The amendment has done away with specified four clauses which restricted the benefit of the rule only in four specified situations. This has widened the scope of the rule thereby enabling the credit of taxes to the actual payee in whose hands the aforesaid income is assessable and not restricting this benefit only to the specified four situations.
PwC News Alert November 2011
3 Conclusion
• The amendment has extended the time-limit for filing TDS return by a Government office
• It has extended the benefit of credit of TDS to persons other than the deductee where the TDS certificate is in the name of any other person of whom the claimant is the representative.
• The deductor would be required to furnish the particulars of declarations furnished by the payee in tax withholding statement.
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