Here are 5 cash transactions that can attract income tax notice

The Income Tax Department and various investment platforms like bank, mutual fund houses, broker platforms, etc. have been discouraging cash transaction by tightening their rules for public in general in last few years.

The Income Tax Department may send notice to the violator now as days in case of slight violation as these institutions allow cash transaction to a certain limit.

Here are top 5 cash transactions that can attract income tax notice:

• Bank FD (fixed deposit): Cash deposit in bank FD is allowed but it should not go beyond Rs 10 lakh. Violation of this Rs 10 lakh limit is also not advisable for a bank depositor making cash deposit in one’s bank FD account.
• Real estate: One must make sure that cash transaction above Rs 30 lakh is questionable while buying or selling a property as income tax department discourages cash transaction beyond this limit in a real estate deal.
• Savings/Current account: The cash deposit limit in savings account for an individual is Rs 1 lakh. The income tax department may send income tax notice if a savings account holder deposits more than Rs 1 lakh in one’s savings account. Similarly, for current account holders, the limit is Rs 50 lakh and on violation of this limit may also liable for income tax notice.
• Mutual fund/stock market/bond/debenture: People investing in mutual funds, stocks, bond or debenture must ensure that its cash infusion in the above mentioned investment options doesn’t go beyond Rs 10 lakh limit. Failing to maintain this cash infusion limit may lead to income tax department checking your last Income Tax Return (ITR).
• Credit Card bill payment: One should not cross Rs 1 lakh limit while paying credit card bill. Violation of this cash limit in credit card bill payment doesn’t go well with the Income Tax Department.

Source from: https://www.moneycontrol.com/news/business/personal-finance/here-are-5-cash-transactions-that-can-attract-income-tax-notice-6873121.html

*TDS U/S Sec 206AB for non filers of income tax*

*TDS U/S Sec 206AB for non filers of income tax:*

1. *Provision:*

Section 206AB mandates the person to deduct TDS in case of non-filing of an income tax return by the specified person.

2. *Meaning of specified person:*

A specified person means a person who satisfies all the below criteria:

👉The person has not filed his Income Tax Returns for the last 2 years. 

👉Due date for filing returns as per Sec 139(1) has passed. 

👉The TDS or TCS liability for each of the two years has been Rs 50,000 or more. 

3. *Tax liability:*

TDS under section 206AB will be deducted at higher of the following rates-

👉 Twice the rate as specified under the relevant provision of the Income Tax Act; or

At the rate of 5%.

4. *Effective date of applicability: 1st July, 2021*. 

5. *Exemption:*  TDS under Salary, withdrawal of PF, winnings under horse races, games, income against investment in securitisation trust, withdrawals of cash 

6. *Applicability of both Sec 206AA and 206AB:*

👉Section 206AA of the Income Tax Act mandates the person to deduct TDS at higher rates in case of non-availability of PAN.

👉If both Sec 206AA and 206AB are applicable, higher of the rates prescribed in both sections would be applicable.

Covid relaxation in GST Compliance

1. No late fees for filing 3b of Mar/April 3b upto 15 days and 30 days from original due date for taxpayer with turnover more than 5 cr and upto 5 crore respectively. For quarter ending 31st mar, no late fees if 3b filed by 30 days from original due date

2. GSTR-4 due date extended to 31st May

3. ITC-04 due date extended to 31st May for Jan-Mar quarter

4. GSTR-1 due date for April'21 extended to 26th May and IFF due date extended to 28th May. 

5. Timeline for all other proceedings, asset order etc. Whose last date of completion falls between 15th April to 30th May is extended to 31st May

6. Relaxation in Interest rate for Mar and April returns