Taxontips
No Result
View All Result
Monday, September 25, 2023
Login/ Register
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Talk to an Expert
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
No Result
View All Result
Taxontips
No Result
View All Result

Higher TDS rate for non-filers of Income tax return – Section 206AB

Income tax Expert by Income tax Expert
April 14, 2021
in Income Tax News
2
CBDT issues circular for detailed explanation on TDS deduction u/s 192 of the Income tax act
138
SHARES
1.7k
VIEWS
image_pdfPDFimage_printPrint

Till date higher TDS was being deducted under Income tax Act u/s 206AA only where assessee was not having valid PAN along with some exceptions.

However, now government also wants to encourage more and more people to become aware about filing of Income tax return and hence it is bringing such provisions which attract higher tax rate if earlier Income tax return’s were not filed.

In earlier Finance act, provision was introduced to deduct higher TDS u/s 194N if return of income is not filed and now government has brought a general section i.e. 206AB for higher deduction of TDS if assessee has not filed the return of income for earlier years as section 194N deals specifically with withdrawal of cash from bank.

The new section 206AB introduced by Finance Act, 2021 for higher TDS for not filing Income tax return read as under:

“206AB. (1) Notwithstanding anything contained in any other provisions of this Act, where tax is required to be deducted at source under the provisions of Chapter XVIIB, other than sections 192, 192A, 194B, 194BB, 194LBC or 194N on any sum or income or amount paid, or payable or credited, by a person (hereafter referred to as deductee) to a specified person, the tax shall be deducted at the higher of the following rates, namely:––
(i) at twice the rate specified in the relevant provision of the Act; or
(ii) at twice the rate or rates in force; or
(iii) at the rate of five per cent.

(2) If the provisions of section 206AA is applicable to a specified person, in addition to the provision of this section, the tax shall be deducted at higher of the two rates provided in this section and in section 206AA.

(3) For the purposes of this section “specified person” means a person who has not filed the returns of income for both of the two assessment years relevant to the two previous years immediately prior to the previous year in which tax is required to be deducted, for which the time limit of filing return of income under sub-section (1) of section 139 has expired; and the aggregate of tax deducted at source and tax collected at source in his case is rupees fifty thousand or more in each of these two previous years:

Provided that the specified person shall not include a non-resident who does not have a permanent establishment in India.

Explanation.––For the purposes of this sub-section, the expression “permanent establishment” includes a fixed place of business through which the business of the enterprise is wholly or partly carried on.’

Thus, if we breakdown this section we can read this as under:

Applicable on which TDS section: On all TDS section except 192, 192A, 194B, 194BB, 194LBC or 194N.

TDS rate prescribed: Higher of  1) Twice the TDS rate mentioned in that section or 2) Twice the TDS rate in force, or 3) 5%.

In case of conflict with section 206AA: In a situation where an assessee doesn’t have PAN and is also falling under section 206AB, in that case higher of rate coming in section 206AA and 206AB will be applicable. In most cases the rate of section 206AA would be higher.

On whom this will be applicable: The above provision will be applicable on a person who has not filed return of income for past 2 years for which due date u/s 139(1) has expired and aggregate of tax deducted at source and tax collected at source in his case is rupees fifty thousand or more in each of these two previous years.

For eg: If a person wants to deduct TDS on July 10, 2021 he needs to see whether the other person has not filed return of income for past 2 years i.e. FY 2019-20 and FY 2018-19 and TDS/ TCS for each of these years in his case was Rs. 50,000 or more.

We won’t count FY 2020-21 here because due date for filing return of this year has still not expired.

As Income tax department has released utility to check applicability to check tax rate u/s 194N we can except similar utility from government for this section as well.

image_pdfPDFimage_printPrint
Tags: 206ABSection 206AB
Previous Post

Updates in Forms GSTR-1, GSTR-3B and Matching Offline Tool for taxpayers in QRMP Scheme

Next Post

Can Assessing officer issue notice u/s 148 after 01.04.2021 for previous 6 years?

Related Posts

Tax audit u/s 44AB to be scrapped?
Income Tax News

Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7

September 18, 2023
Tax audit u/s 44AB to be scrapped?
Income Tax News

Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act

September 18, 2023
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal

September 16, 2023
How to calculate turnover in case of intra day and future and option trading for Income Tax purpose?
Income Tax News

Definition of turnover in relation to F&O and intraday as per Revised guidance note of ICAI on Tax audit for 2023

September 13, 2023
No TDS on interest income upto Rs. 40,000 from bank – Section 194A Limit revised
Income Tax News

Claim TDS credit deducted in next assessment year for income offered in earlier year [Read section]

September 9, 2023
Received mail from GSTN “Aggregate turnover being more than Rs. 5 Cr during FY 2019-20” What does this mean?
Income Tax News

Salaried employee receiving notices for claiming deduction under Chapter VI-A

September 7, 2023
Next Post
Received mail from GSTN “Aggregate turnover being more than Rs. 5 Cr during FY 2019-20” What does this mean?

Can Assessing officer issue notice u/s 148 after 01.04.2021 for previous 6 years?

Comments 2

  1. Pingback: How to register and use the functionality to check status of specified person u/s 206AB and 206CCA for higher TDS/ TCS rate - Taxontips
  2. Pingback: What is section 206AB where TDS is deducted at double rate for non-filers and for which declaration is being circulated by businesses - Taxontips

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Google Custom search

Recent Posts

  • Advisory: Geocoding Functionality for the Additional Place of Business – GST website
  • Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open
  • Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7
  • Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act
  • Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal

Recent Comments

  • Srinivasan Venkatasubramanian Venkatasubramanian on GST turnover limit for services increased to Rs. 40 lakh by CBIC?
  • Notification under PMLA by Ministry of Finance which could affect CA, CS and CMA - Taxontips on CA, CS and CMA now under PMLA. KYC of clients required
  • ITR 4 is now available on e-filing website for FY 2022-23 i.e. AY 2023-24 | File ITR with experts on Taxontips – Taxontips on Businessman with turnover below 1 crore and having profit below 8% need to compulsorily get books of accounts audited: Let’s find out
  • Can a person earning income from speculative business transaction file return u/s 44AD of Income tax act - Taxontips on How to calculate turnover in case of intra day and future and option trading for Income Tax purpose?
  • Extension of last date for updation of Member’s Profile with GSTIN at Self Service Portal – Till 23rd April, 2023 - Taxontips on Updation of Member’s Profile at Self Service Portal with GSTIN to get GST credit till 15.04.2023

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Browse Topics by Date

September 2023
M T W T F S S
 123
45678910
11121314151617
18192021222324
252627282930  
« Aug    
  • GSTR 9/ 9C extended : AGAIN

    GSTR 9/ 9C due date to be extended to 31.10.2020 | E-invoicing will be voluntary in the beginning

    6457 shares
    Share 2583 Tweet 1614
  • How to pay Membership and COP fees of ICAI for 2020-21 |

    6351 shares
    Share 2540 Tweet 1588
  • Code/ Nature of payment 6CR updated by NSDL in challan 281 for paying TCS on sale of goods

    5732 shares
    Share 2293 Tweet 1433
  • Are all the due dates of tax audit and Income tax return for FY 2019-20 extended to 31.03.2021 by the bill presented in Lok sabha Dt. 18.09.2020

    4772 shares
    Share 1909 Tweet 1193
  • SFT transaction mentioned in Form 26AS | What does it mean? | Who reports it? | SFT codes transaction type

    3999 shares
    Share 1600 Tweet 1000

Recent Notification

Data of GST website under comparison of liability declared and ITC claimed tab not available

Advisory: Geocoding Functionality for the Additional Place of Business – GST website

September 21, 2023
ICAI has announced a new MBA programme for Diploma in Management and Business Finance

Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open

September 20, 2023

RSS Taxontips

  • Advisory: Geocoding Functionality for the Additional Place of Business – GST website
  • Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open
  • Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7
  • Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act
  • Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal
  • How to calculate Value of supply in case of online gaming including online money gaming [Read notification]
  • Introducing Electronic Credit Reversal and Re-claimed statement on GSTN
  • Definition of turnover in relation to F&O and intraday as per Revised guidance note of ICAI on Tax audit for 2023
  • Claim TDS credit deducted in next assessment year for income offered in earlier year [Read section]
  • Salaried employee receiving notices for claiming deduction under Chapter VI-A

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Site menu

  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Taxontips

TaxOnTips provides you all tax related solutions in easy way and update you with its regular updates & notifications Visit us for details.
We are based in Jaipur, India

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

No Result
View All Result
  • Login/Signup
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • About us
  • Contact us
  • Ask an expert/ Talk to an expert
  • Q & A
  • Privacy Policy
  • Terms of use

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

Book Phone consultation with expert

Sitting home or at your office and don't have time to visit CA's office or don't know where to consult CA. Book your consultation with an expert practicing Chartered Accountant and get your query solved.

Book a phone consultation for 30 minutes with our expert at a very basic cost.

Book consultation

No thanks, I'm not interested!