INTRODUCTION
The Honourable Prime Minister in his speech on May 12, 2020 had announced INR 20 Lakh- Crores package, equivalent to about 10% of India’s GDP, aiming at making the country self- reliant and reviving the Indian economy. In this backdrop, the Honourable Finance Minister, Mrs. Nirmala Sitharaman has announced a slew of measures to deal with the economic distress caused due to the COVID-19 pandemic and the subsequent lockdown. The various measures are as follows:
RELAXATION IN DUE DATES FOR FILING INCOME TAX RETURN
| Type of Assessee | Existing Due Date | Revised Due Date |
| Audit Cases | ||
| – Income Tax Return | October 31, 2020 | November 30, 2020 |
| – Audit Report | September 30, 2020 | October 31, 2020 |
|
Non-Audit Cases (Ex: Salaried Employees, Non-Tax Audit Businesses) |
July 31, 2020 |
November 30, 2020 |
TDS RATESREDUCED
|
Section |
Nature of Payment |
April 01, 2020 to May 13, 2020 |
May 14, 2020 to Mar 31, 2021 |
| 193 | Interest on securities | 10% | 7.50% |
| 194 | Dividend | 10% | 7.50% |
| 194A | Interest other than interest on securities | 10% | 7.50% |
| 194C | Payment of contractors and sub-contractors |
1%(Indl/HUF) 2% (others) |
0.75%(Indl/HUF) 1.50% (others) |
| 194D | Insurance commission | 5% | 3.75% |
| 194DA | Payment w.r.t life insurance policy | 5% | 3.75% |
| 194EE | Payments in respect of deposits under National Savings Scheme | 10% | 7.50% |
| 194F | Payments on account of re- purchase of Units by Mutual Funds or UTI | 20% | 15% |
| 194G | Commission, prize etc., on sale of lottery tickets | 5% | 3.75% |
| 194H | Commission or brokerage | 5% | 3.75% |
| 194-I(a) | Rent for plant and machinery | 2% | 1.50% |
| 194-I(b) | Rent for immovable property | 10% | 7.50% |
| 194-IA | Payment for acquisition of immovable property | 1% | 0.75% |
| 194-IB | Payment of rent by individual or HUF | 5% | 3.75% |
| 194-IC | Payment for joint development agreements | 10% | 7.50% |
| 194J |
Fee for professional or technical services (FTS), royalty, etc. |
2% (FTS, certain royalties, call center) 10% (others) |
1.5% (FTS, certain royalties, call center) 7.50% (others) |
| 194K | Payment of dividend by mutual funds | 10% | 7.50% |
| 194LA | Payment of compensation on acquisition of immovable property | 10% | 7.50% |
| 194LBA(1) | Payment of income by business trust | 10% | 7.50% |
| 194LBB(i) | Payment of income by Investment fund | 10% | 7.50% |
| 194LBC(1) | Income by securitisation trust |
25%(Indl/HUF) 30% (Others) |
18.75%(Indl/HUF) 22.5% (Others) |
| 194M | Payment to commission or brokerage etc. by individual and HUF | 5% | 3.75% |
| 194-O | TDS on e-commerce participants |
1% (w.e.f. 01.10.20) |
0.75% |
TCS RATES REDUCED
|
Section |
Nature of Receipts |
April 01, 2020 to May 13, 2020 |
May 14, 2020 to Mar 31, 2021 |
| 206C(1) | Sale of | ||
| (a) Tendu leaves | 5% | 3.75% | |
| (b) Timber obtained under a forest lease | 2.5% | 1.875% | |
| (c) Timber obtained by any other mode | 2 .5% | 1.875% | |
| (d) Any other forest produces not being timber/tendu leaves | 2.5% | 1.875% | |
| (e) Scrap | 1% | 0.75% | |
| (f) Minerals being coal or lignite or iron ore | 1% | 0.75% | |
| 206C (1C) | Grant of license, lease, etc., of | ||
| (a) Parking lot | 2% | 1.5% | |
| (b) Toll Plaza | 2% | 1.5% | |
| (c) Mining and quarrying | 2% | 1.5% | |
| 206C(1F) | Sale of Motor vehicle above 10 lakhs | 1% | 0.75% |
| 206C(1H) | Sale of any other goods |
0.1% (w.e.f.01.10.20) |
0.075% |
NON-FURNISHING OF PAN/AADHAR
There shall be no reduction in rates of TDS or TCS, where the tax is required to be deducted or collected at higher rate due to non-furnishing of PAN/Aadhar. The rates shall continue to remain at 20 percent.
MSME (MICRO, SMALL AND MEDIUM ENTERPRISES)
Revised Definition of MSME
MSME are an important factor in job creation. Therefore, to enable the MSME to create more jobs the definition of MSME has been widened and a new composite criteria has been provided to avail various benefits and schemes of the Government.
| Existing MSME Classification | |||
|
Criteria Investment in Plant & Machinery/Equipment |
|||
| Classification | Micro | Small | Medium |
| Mfg. Enterprises | Investment<Rs. 25Lakh | Investment< Rs.5Cr. | Investment <Rs.10Cr. |
| Services Enterprises | Investment<Rs.10Lakh | Investment<Rs.2Cr. | Investment<Rs.5Cr. |
| Revised MSME Classification | |||
|
Composite Criteria Investment in Plant & Machinery/EquipmentANDAnnual Turnover |
|||
| Classification | Micro | Small | Medium |
|
Manufacturing & Service Enterprises |
Investment<Rs.1Cr. | Investment<Rs.10Cr. | Investment<Rs.20Cr. |
| AND | AND | AND | |
| Turnover<Rs.5Cr. | Turnover<Rs.50Cr. | Turnover<Rs.100Cr. | |
COLLATERAL FREE LOANS
- Borrowers with up to Rs. 25 Crore outstanding and Rs. 100 Crore turnovers are eligible for Loan under this scheme.
- Loan to have 4-year tenor with moratorium of 12 months on principal repayment.
- Interest to be capped.
- Scheme can be availed up to October 31, 2020.
- No guarantee fee and fresh collateral required.
VIVAD SE VISHWAS SCHEME
In the Union Budget 2020, the Government of India came out with an amnesty scheme to settle disputes of Income Tax where the cases are under appeal proceedings.Earlier, the due date for making the payment without additional amount was March 31, 2020. Now the same has been extended up to December 31, 2020.
INCOME TAX ASSESSMENTS DUE DATES EXTENDED
| Time Barred on | Revised Date |
| September 30, 2020 | December 31, 2020 |
| March 31, 2021 | September 30, 2021 |
EPF SUPPORT FOR BUSINESS & WORKERS
- Under the Pradhan Mantri Garib Kalyan Package the Government shall credit the accounts of employees with 24% of monthly wages into their PF accounts for next three months for the wage-earners below Rs 15,000 p.m. in businesses having less than 100 workers.
- The Government has reduced statutory PF contributions of both employer and employee to 10% each from existing 12% each for all establishments covered by EPFO for next 3 months (June, July and August 2020). This scheme will be applicable for workers who are not eligible for 24% EPF support under Pradhan Mantri Garib Kalyan Package (PMGKP).
- In case of Government employers,the contribution will continue to be 12%, whereas, employee shall contribute only 10%.
EXTENSION OF REGISTRATION &COMPLETION DATE OF REAL ESTATE PROJECTS UNDER RERA
- Treat COVID 19 as an event of Force Majeure under RERA.
- Extend the registration and completion date suo-moto by 6 months for all registered projects expiring on or after March 25, 2020 without individual applications.
- Regulatory Authorities may extend this for another period of up to 3 months, if needed.
- Issue fresh ‘Project Registration Certificates’ automatically with revised timelines.
- Extend timelines for various statuary compliances under RERA concurrently.
■ May 15, 2020