CBDT Current Affairs - 2020

CBDT issues clarification over Section 115 BAC of Income Tax Act

The Central Board of Direct Taxes recently clarified that the employers shall seek clarification and detect tax at source.

Section 115 BAC

The Section 115 BAC was inserted recently into the Income Tax Act, 1961. According to the section, a person receiving income other than family business shall be taxed under Section 115 BAC. This is to be furbished along with those submitted under Section 139 of the act.

The issue arose if the tax that was imposed under Section 115 BAC is to be considered under TDS (tax to be detected at source).

Clarity

The CBDT has provided the following clarity

  • If the tax payer is an employee of an organization and he has income other than that received from the organization, and intends to get concessional rate under Section 115 BAC should intimate the deductor each previous year.
  • In case the employee fails to make the intimation, the employer shall make TDS without considering the provisions of Section 115 BAC.

CBDT releases relief funds to MSME

The Central Board of Direct Taxes (CBDT) issued Rs 5,204 cores as relief funds to MSME (Micro Medium and Small Enterprises) sector. Around 8.2 lakh small businesses have received Income Tax Refunds so far.

Highlights

In the last 10 days, CBDT issued Rs 5,204 crores as Income Tax refunds. The funds were issued to help MSMEs move out of their financial crunches caused due to COVID-19 crisis.

What is the issue?

The lock down has hit the cash flow of MSME sector. The released funds will help to increase the liquidity flow in the sector. Many workers employed in the sector have returned to their home town. Now, even if the government has permitted resuming of works in MSMEs, the industry is to face shortage of labours.

Outstanding Cases

There are 1.74 lakhs of pending cases with the CBDT. These cases are awaiting responses from taxpayers. These tax payers have been sent e-mails requesting them to reply within 7 days.