The government has extended the deadline for income tax compliance for 2018-19 to July 31 due to disruptions resulting from the COVID-19 pandemic. CNBC-TV18 was the first to report that the Centre was planning to extend the deadline from June 30.
Several tax compliance due dates such as those for completing proceedings, issuing orders, notices etc were due to be filed latest by June 30. However, after the Central Board of Direct Taxes (CBDT) several representations from officers and taxpayers for an extension as government offices were not fully functional, the dates have been extended by a month.
The government had extended deadlines up to June 30, under Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, dated March 31, 2020. The relief was extended especially for proceedings, penalty/revision orders to be passed/notices under section 148 etc, which were getting time barred on March 31, 2020 for issue, sanction, approvals.
Amit Maheshwari, partner at tax consultancy firm AKM Global said, "Since it is expected that the disruption caused by Covid-19 will extend longer, further extension of these deadlines would be a breather and will enable the businesses to deal with disruption. However, it is surprising that the benefit of reduced interest have not been extended further as the companies are still facing severe cash flow issues and this ought to have been extended."
Ved Jain, independent tax expert and past President of ICAI was of the view, "The CBDT in a welcome move considering the impact of lock down has further extended period for various compliances under Direct Taxes. The government has displayed a bold move by extending deadlines by 9 months in some cases in one go. However, the present notification has not made any exception for filing of appeals, reply , report and return also except return to be filed for asstt year 2019-20 and that too under section 139. Accordingly limit for filing all such appeals , reply, report, returns may be under section 148, or 153A which falls due up to 31st December (other than for asstt year 2019-20 and asstt year 2020-21 under section 139) stand extended to 31st March ,2021. This appears to be not intended extension."
Jain added that there is no further extension for payment of taxes, considering the fact that government is finding it difficult to mop up revenue and falling short of collections. Thus all taxpayers need to deposit tax dues by June 30, 2020 to seek benefits of extension provided by the earlier Ordinance and concessional rate of 9% interest . In case of non payment of tax by June 30, 2020, the normal interest and penal provisions will apply from March 20, 2020.
The date for filing TDS return for February and March have been extended to July 31, 2020. Further deduction for contribution to PF, PPF , NSC, donations made up to July 31, 2020 can be claimed in the return for 2020-21.
Investments in a new house for claiming deduction under section 54 and 54G can be made up to September 30, 2020. The last date for Vivad se Vishwas has been extended to 31st December,2020 which in due course will follow legislative amendment.
With this notification, it has addressed the challenge which both its officers as well as taxpayers were facing to complete the action by 30th June,2020."
The March 31 ordinance has enabled provision empowering the central government to further extend due dates to beyond June 30, 2020. The due date for filing ITR for FY2019-20 has already been extended till November 30, 2020.
The government also extended an opportunity to taxpayers to comply with principle of natural justice.
Here's the full list of the extended deadlines:
1. The time for filing of original as well as revised income-tax returns for the FY 2018-19 (AY 2019-20) has been extended to July 31, 2020.
2. Due date for income tax return for the FY 2019-20 (AY 2020-21) has been extended to 30th November, 2020. Hence, the returns of income which are required to be filed by the 31st July, 2020 and 31st October, 2020 can be filed to 30th November, 2020. Consequently, the date for furnishing tax audit report has also been extended to 31st October, 2020.
3. In order to provide relief to small and middle class taxpayers, the date for payment of self-assessment tax in the case of a taxpayer whose self-assessment tax liability is up to Rs. 1 Lakh has also been extended to 30th November, 2020. However, it is clarified that there will be no extension of date for the payment of self-assessment tax for the taxpayers having self-assessment tax liability exceeding Rs. 1 lakh. In this case, the whole of the self-assessment tax shall be payable by the due dates specified in the Income Tax Act (IT Act) and delayed payment would attract interest under section 234A of the IT Act.
4. The date for making various investment/ payment for claiming deduction under Chapter-VIA-B of the IT Act which includes section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim), 80G (Donations) etc. has also been further extended to 31st July, 2020. Hence the investment/ payment can be made up to 31st July, 2020 for claiming the deduction under these sections for FY 2019-20.
5. The date for making investment/ construction/ purchase for claiming roll over benefit/ deduction in respect of capital gains under sections 54 to 54GB of the IT Act has also been further extended to 30th September, 2020. Therefore, the investment/ construction/ purchase made up to 30th September, 2020 shall be eligible for claiming deduction from capital gains.
6. The date for commencement of operation for the SEZ units for claiming deduction under deduction 10AA of the IT Act has also been further extended to 30th September, 2020 for the units which received necessary approval by 31st March 2020.
7. The furnishing of the TDS/ TCS statements and issuance of TDS/ TCS certificates are the prerequisite for enabling the taxpayers to prepare their return of income for FY 2019-20, the date for furnishing of TDS/ TCS statement and issuance of TDS/ TCS certificate pertaining to the FY 2019-20 has been extended only to 31st July, 2020 and 15th August, 2020 respectively.
8. The date for passing of order or issuance of notice by the authorities and various compliances under various direct taxes & Benami Law which are required to be passed/ issued/ made by 31st December, 2020 has been extended to 31st March, 2021. Consequently, the date for linking of Aadhaar with PAN would also be extended to 31st March, 2021.9. The reduced rate of interest of 9% for delayed payments of taxes, levies, etc. specified in the Ordinance shall not be applicable for the payments made after 30th June, 2020.