Corporate and Professional Updates 5th April 2018

Corporate and Professional Updates 5th April 2018

Direct Tax:

• SC dismisses Revenue’s SLP against Delhi HC judgement allowing Sec. 80HHE deduction to New Delhi Television Ltd. (‘NDTV’, assessee) for AY 1999-00; HC had observed that television news software exported by assessee outside India was ‘customized electronic data’  [as defined in clause (b) to Sec. 80HHE Explanation] to meet the requirement of STAR TVHC had referred to the agreement/MoU  between assessee, New Delhi Television (India) Private Limited (‘NTVI’)  and STAR TV,  and had noted that assessee would be responsible for production of entire software (programming) for a 24-hour Indian news channel which would be supplied to NTVI which would in turn broadcast the said channel through STAR TV.
• HC had ruled that “The expression ‘any customized electronic data’ is preceded by the disjunctive ‘or’ which clearly indicates that any customized electronic data would also be considered to be ‘computer software’ under the inclusive part of the definition.”[TS-151-SC-2018]
• ITAT rules on selection of comparables in respect of assessee’s software development segment for AY 2006-07; Excludes 6 comparables on various grounds such as functional dissimilarity, absence of segmental details, ownership of intangibles etc., follows Mphasis ruling; Also remits comparability of Megasoft for consideration of only software services segmental margin following Mphasis ruling [TS-212-ITAT-2018(Bang)-TP]
• Limit for payment of expenses by cash (Both capital and revenue expenditure) reduced from RS. 20,000 to RS. 10,000 per day in aggregate per person.
• No Person shall receive an amount of two lakh rupees or more, by cash (Sec 269ST).
• For below Rs. 2 crores turnover cases – For Non cash sales (through Digital, Online, cheque, Bank etc.) : Net Profit will be taken as 6% of Turnover/ Gross Receipt. It is 8% For Cash Sales.
• Tax Exemption limit is Rs.2,50,000/- (same as earlier) After that, up to 5 Lakh, Tax rate is 5% (earlier it was 10%).
• Tax rebate is reduced to Rs.2500 from Rs.5000 per year for taxpayers with income up to Rs.3,50,000 (earlier Rs.5,00,000).
• Surcharge at 10 percent of tax levied on rich taxpayers with income between Rs.50 Lakh and Rs.1 Crore. The rate for surcharge for the super-rich, with income above Rs.1 Crore will remain 15%.
• Payment of Rent – Rs.50,000 per month by any Individual or HUF (not subject to Tax Audit requirement) – Deduct TDS @ 5%.
• Capital gain in respect of Land and Building period reduced from 3 Years to 2 Years and Base year shifted from 01/04/1981 to 01/04/2001.
• Corporate tax rate for the account year 2017-18 for companies with annual turnover up to Rs.50 crores (in account year 2015-16) is reduced to 25%. No change in firm tax rate of 30%.
• Donation made exceeding Rs.2000 will be not be eligible for deduction under section 80G.
• Shares of unquoted shares to be taxed at (deemed) fair value.
• tax exemption will be available on reinvestment of capital gains in notified redeemable bonds (In addition to investment in NHAI and REC bonds).
• Deduction for first time investors in listed equity shares or listed units of equity oriented funds under the Rajiv Gandhi Equity Savings Scheme under section 80CCG of IT act 1961 is withdrawn from FY 2017-18. If an individual has already claimed deduction under this scheme before April 1, 2017, They shall be allowed to avail a deduction for the next two years.
• No tax is applicable for partial withdrawals from National Pension System. NPS subscribers will be able to withdraw 25% of their contribution to the corpus for emergencies before retirement. Withdrawal of 40% of the corpus is tax free before retirement.
• In absence of PAN of the buyer of specified goods, the rate of TCS will be twice of the extent rate or 5%, whichever is higher.
• From Financial Year 2017-18, if Return is not filed within due date, late fee of Rs.5,000 for delay up to 31st December, and Rs.10,000 thereafter.
• It is mandatory to disclose the Aadhar number while filing IT Return. Earlier it was optional to disclose the Aadhar number.
• Generally, the last date of filing IT returnhttps://carajput.com/income-tax-services.php is 31 July. Therefore, it is advisable for taxpayer to get their Aadhar number at the earliest.

2. ITR 2

FAQ on Condonation of Delay Scheme (CODS):

• Query: Is filing of pending documents with ROC under the scheme is a solution to all problems?
• Answer:Filing of documents under the scheme means you have regularized the pending filings of annual returns and financial statements. Further, company and its officers would not be prosecuted for delayed filing of the said documents. It also saves companies from payment of hefty additional filing fees under the Companies Amendment Act 2017.

MCA Update :

• Ministry of Corporate Affairs informs that  Temporary suspension of issuance of allotment of new DINs for Designated Partners/Partners of LLPs is being extended till further notice. A suitable message would be posted on the portal after revised DIR-3 is made available for filing purposes for issuance of new DPIN/DINs for Partners of proposed LLPs. Stakeholders may kindly take note and plan accordingly.

Key dates

• Filing of GSTR-4 for jan-2018-march-2018: 18.04.2018
• Filing of GSTR-1 for feb 2018(turnover more than Rs1.50 cr):10.04.2018
• More read:

  • New TDS deduction No cash transactions exceeding 1 Crore -Section 194N

  • Extention of TDS/TCS statement filing Date

  • TDS payment to resident contractors