CBDT Current Affairs - 2019

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Govt relaxes norms for Start-ups

The government has relaxed the norms under the definition of Start-Ups. The changes brought in are:

  • The investment limit of angel investors to seek exemption under the Income Tax Act, 1961 has been increased to Rs 25 crore from 10 Crore.
  • An entity shall be considered a start-up up to 10 years from its date of incorporation/registration instead of the previous period of 7 years.
  • An entity would be considered as a startup up to a turnover of Rs 100 crore as against the earlier limit of Rs 25 crore.

Exemptions Proposed

  • A start-up cannot invest in a building or land unless it is for its business or used by it for purposes of renting or held by it as stock-in-trade.
  • A start-up cannot offer loans or advances, other than those where lending money is part of its business.
  • A start-up cannot make any capital contribution to any other entity or invest in shares, car, any vehicle or mode of transport that costs more than Rs 10 lakh.

These exemptions were brought in to allay the fears of CBDT that start-ups could be used for money laundering or receive investment from shell companies for tax evasion.

The relaxations are in line with the government’s vision to promote the culture of entrepreneurship and ease of doing business in India.

Month: Categories: Business, Economy & BankingUPSC

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61 Individuals Declared Annual Income of Over Rs 100 Crore

As per the information provided by Minister of State for Finance Pon Radhakrishnan to the Lok Sabha 61 individuals who declared an income of more than Rs 100 crore during the assessment year 2017-18.

Even though the numbers have increased sharply from the 38 individuals reporting income over Rs 100 Crore in the previous assessment year, it is still a minuscule number in a population of 1.3 billion Indians.

In the assessment year 2014-15, the number of individuals disclosing a gross total income of over Rs 100 crore in a year in his/her return of income filed with the Income Tax (IT) department was 24.

Even though there has been a sharp increase in the number of individuals declaring income of over 100 crore, it has been said the actual numbers are predominantly more and reported numbers are less due to the large scale underreporting.

The following steps have been initiated to prevent the under-reporting:

  • Government is taking stringent actions under the Benami Properties Transactions Act and properties valued at Rs 6,900 crore were under attachment by agencies.
  • Income tax authorities had identified more than 2,000 benami transactions till December 2018 which includes include deposits in bank accounts, land, apartments and jewellery and the provisional attachment of properties had been done in over 1,800 cases.
  • The Revenue Department under the Ministry of Finance is setting up a mechanism to ensure that all returns are processed within 24 hours and refunds issued simultaneously to increase the compliance in the filing of IT returns.

The government has already sanctioned Rs 4,200 crore for the upgrade of information technology infrastructure of Central Board of Direct Taxes (CBDT) for processing returns, refunds, faceless scrutiny and verification.

Month: Categories: Business, Economy & BankingUPSC

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