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TDS Filing Due Date Extended by a Month; Form 16 Delayed till July 15. Know New Rules

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In the latest TDS return filing forms, one more column has been added for those employees who want to opt for the new tax regime. Know details

In the wake of the second wave of the coronavirus pandemic, the Central Board of Direct Taxes (CBDT) has extended the deadlines to file income tax returns for the financial year 2021.

The last date of filing Tax Deducted at Source (TDS) for the fourth quarter of financial year 2020-21 has been extended to June 30, according to the circular issued by the Income Tax department. Earlier, the due of filing the TDS was May 31. Accordingly, the due date of issuance of Form 16 has also been extended to July 15 from June 15.

“In such a COVID-19 pandemic situation, it is a big relief for individual taxpayers and businesses. It was becoming difficult for taxpayers to comply with such deadlines due to multiple issues like non-availability of funds for small businesses, family health issues, movement from one place to another etc., making compliance difficult for businesses. Hence, It will give them more time to comply with the deadlines and avoid any penalties, late fees etc," said Abhishek Soni, co-founder and chief executive officer, Tax2win.

“This is a major relief for the TDS deductors since these returns involve lot of records and data to be reported correctly," Sujit Bangar, founder, Taxbuddy.com mentioned.

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Key things to remember while filing TDS returns

1) In the latest TDS return filing forms, one more column has been added for those employees who want to opt for the new tax regime. Accordingly, at the time of filing the TDS return, the employer (deductor) has to select the option for those who are going to opt for the new tax regime, Soni commented.

2) If the TDS deducted in each year, exceeds Rs 50,000 and if the individual has not filed TDS in the last two years, the government will charge more TDS while filing the returns. Explaining this new rule, Abhishek Soni said, “In Budget 2021, a new section 206AB was introduced to deduct TDS at a higher rate on cases with certain nature of income. Where the return of income not filed for the previous two years and TDS deducted in each year exceeds Rs 50,000. The rate of TDS will be higher of the below limits a) Twice the rate specified under the relevant section/provision or b) Twice the rate/rates in force or c) Rate of five per cent.

3) “In case the amount of tax  payable in cash at the time of filing the ITR is more than Rs 1 lakh, then the penal Interest under Section 234A shall apply from the original due date of filing the ITR. For example, if the tax payable by an assessee is Rs 5 lakh, the advance tax paid is Rs 1 lakh and the TDS/TCS is Rs 2 lakh. Hence for this assessee the tax payable in cash at the time of filing the return is Rs 2 lakhs (which is greater than Rs 1 lakh). For this assessee the due date of filing ITR is July 31. The interest under the Section 234 will be chargeable at 1% from  August 1 irrespective of extension of due date of filing income tax returns till September 30. This is a dampner of sorts in this extension circular," said  Vivek Jalan, partner, Tax Connect Advisory Services, a multi-disciplinary tax consultancy firm.

Now taxpayers have time till September 30 for furnishing return of income for the Assessment Year 2021-22. Audit Assessees can file income tax returns by November 30. Due date of furnishing Tax Audit Report extended to October 31. Individuals can file belated/revised return of income till January 31, 2022.

“The extension of various filing timelines is indeed a relief for corporates. The tax withholding on salary for FY 20-21 had added complexities in terms of determining taxable employer contributions to PF, NPS and Superannuation, identifying and reporting interest accretions on the same, enabling employees to avail the deemed Leave Travel Concessions etc," said Saraswathi Kasturirangan, Partner, Deloitte India.

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first published:May 24, 2021, 16:50 IST