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 Update: CBDT announces tax exemption for expenditure on COVID-19 treatment and grants further extension in timelines of compliances
Update: CBDT announces tax exemption for expenditure on COVID-19 treatment and grants further extension in timelines of compliances

June 28, 2021

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Central Board of Direct taxes (CBDT), vide Press Release dated June 25, 2021, has provided income-tax exemption to the amount received by a taxpayer for medical treatment from employer or from any person for treatment of COVID-19 during Financial year (FY) 2019-20 and subsequent years. In this context, NASSCOM submitted a representation to CBDT and Ministry of Finance requesting to clarify that reimbursement of amount incurred by employee for COVID-19 treatment, or any other support provided by employer will not be treated as perquisite under the Income Tax Act. This is a welcome clarification and will provide clarity to the industry and help companies in providing necessary support to their employees, while being compliant with the laws.

Further, income-tax exemption has been provided to ex-gratia payment received by family members of a person from the employer of such person or from other person on the death of the person on account of Covid-19 during FY 2019-20 and subsequent years. The exemption shall be allowed without any limit for the amount received from the employer and the exemption shall be limited to INR 10 lakh in aggregate for the amount received from any other persons.

Moreover, in order to provide relief to taxpayers in meeting tax compliances deadlines, CBDT has further extended the timelines for compliances as follows:

  1. Objections to Dispute Resolution Panel (DRP) and Assessing Officer u/s 144C of Income-tax Act, 1961 (IT Act) - Last date extended from June 1 to, 2021 to the time provided in that section or by 31st August, 2021, whichever is later.
  2. Statement of Deduction of Tax for last quarter of FY 2020-21 – The statement may be furnished on or before 15 July, 2021 (instead of June 30)
  3. Certificate of Tax Deducted at Source in Form No.16 - The certificate may be furnished on or before 31 July, 2021 (instead of July 15)
  4. Statement of Income paid/ credited by an investment fund to its unit holder in Form No. 64D for year 2020-21 – The statement may be furnished on or before 15 July, 2021 (instead of June 30)
  5. Statement of Income paid or credited by an investment fund to its unit holder in Form No. 64C for 2020-21 – The statement may be furnished on or before 31 July, 2021 (instead of July 15)
  6. Application u/s 10(23C), 12AB, 35(1)(ii)/(iia)/(iii) and 80G in Form No. 10A/ Form No.10AB - The statement may be submitted before 31 August, 2021 (instead of June 30)
  7. Compliances for claiming exemption u/s 54 to 54GB – The compliances may be completed before 30 September, 2021 for which last date of compliance falls between 1st April, 2021 to 29th September, 2021
  8. Quarterly Statement in Form No. 15CC – The statement may be furnished before 31 July, 2021 for remittances made for the quarter ending on 30th June, 2021 (instead of 15 July, 2021)
  9. Equalization Levy Statement in Form No. 1 for FY 2020-21 – The statement may be furnished before July 31, 2021 (instead of 30 June, 2021)
  10. Annual Statement us/ 9A(5) in Form No. 3CEK for FY 2020-21 – The statement may be furnished before 31 July, 2021 (instead of 29 June, 2021)
  11. Uploading declarations received from recipients in Form No. 15G/15H during quarter ending 30th June, 2021 – The same may be uploaded before 31 August, 2021 (instead of 15 July, 2021)
  12. Exercising option to withdraw pending application in Form No. 34BB – The option can now be exercised before 31 July, 2021.
  13. Linkage of Aadhaar with PAN – The linkage may be done before 30 September, 2021 (instead of 30 June, 2021)
  14. Payment of amount under Vivad se Vishwas (without additional amount) – Last date extended to 31 August, 2021 (instead of 30 June, 2021)
  15. Payment of amount under Vivad se Vishwas (with additional amount) – Last date has been notified as 31 October, 2021
  16. Time Limit for passing assessment order – The same has been extended to 30 September, 2021
  17. Time Limit for passing penalty order – Extended to 30 September, 2021
  18. Time Limit for processing Equalisation Levy returns – Extended to 30 September, 2021 (instead of 30 June, 2021)

Copy of the Press Release is attached for your reference.

We hope you will find the update useful. 


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25.06.2021- Press Release - Government grants further extension in timelines of compliances SJ.pdf

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