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Section 206AB and 206CCA, effective from national holiday, 2021, primarily requires for deduction (TDS) and collection (TCS) of tax respectively at a higher rate* for the required person.
A specified person could be a person
HIGH RATE OF TDS ON NON-FILERS OF ITR UNDER SECTION 206AB | HIGH RATE OF TCS ON NON-FILERS OF ITR UNDER SECTION 206CCA |
APPLIES WHERE THE DEDUCTEE FAILS TO FURNISH TO FURNISH THEIR ITR FOR 2 FINANCIAL YEARS, IMMEDIATELY PRECEDING THE FINANCIAL YEAR IN WHICH THE TDS IS REQUIRED TO BE DEDUCTED. | APPLIES WHERE THE DEDUCTEE FAILS TO FURNISH TO FURNISH THEIR ITR FOR 2 FINANCIAL YEARS, IMMEDIATELY PRECEDING THE FINANCIAL YEAR IN WHICH THE TCS IS REQUIRED TO BE COLLECTED. |
SPECIFIED PERSON – A PERSON IS SAID TO BE A SPECIFIED PERSON, WHERE ALL THE FOLLOWING CONDITIONS ARE FULFILLED –
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EXEMPTED WHERE THE INCOME IS REQUIRED TO BE DEDUCTED UNDER THE FOLLOWING SECTIONS – · SECTION 192 · SECTION 192A · SECTION 194B, 194BB HOWEVER, THIS EXEMPTION SHALL NOT BE AVAILABLE TO A NON-RESIDENT, NOT HAVING A PERMANENT ESTABLISHMENT IN INDIA. | EXEMPTED WHERE INCOME IS RECEIVED BY ANY NON-RESIDENT NOT HAVING A PERMANENT ESTABLISHMENT IN INDIA |
RATE WOULD BE HIGHER OF – · AT TWICE THE RATE, BEING SPECIFIED IN RESPECTIVE PROVISION. · AT TWICE THE RATE OR RATES THAT ARE THERE IN FORCE.
| RATE WOULD BE HIGHER OF – · AT TWICE THE RATE, BEING SPECIFIED IN THE RESPECTIVE PROVISION.
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ALSO, WHERE THE DEDUCTEE FAILS TO FURNISH HIS PAN TO THE DEDUCTOR, TDS BE DEDUCTED @ PROVIDED IN THIS SECTION OR IN SECTION 206AA, HIGHER OF THE RATES
RATE UNDER SECTION 206AA: HIGHER OF: I) RATE BEING SPECIFIED IN THE RESPCETIVE PROVISION; II) RATE OR RATES THAT ARE THERE IN FORCE; OR III) 20%. CONCLUSION: WHERE THE DEDUCTEE FAILS TO FURNISH HIS PAN AS WELL AS ITR FOR 2 CONSECUTIVE PREVIOUS YEARS, TDS BE DEDCUTED AT HIGHER OF: 1) TWICE THE RATE, BEING SPECIFIED IN THE RESPECTIVE PROVISION OF THE ACT 2) TWICE THE RATE OR RATES THAT ARE THERE IN FORCE; OR 3) 20%. | ALSO, WHERE THE COLLECTEE FAILS TO FURNISH HIS PAN TO THE COLLECTOR, TCS COLLECTED AT THE RATES PROVIDED IN THIS SECTION OR IN SECTION 206CC, HIGHER OF THE RATES RATES UNDER SECTION 206CC: HIGHER OF: I) TWICE THE RATE, BEING SPECIFIED IN SECTION 206C; II) 5%. CONCLUSION: WHERE THE COLLECTEE FAILS TO FURNISH HIS PAN AS WELL AS ITR FOR 2 CONSECUTIVE PREVIOUS YEARS, TCS BE COLLECTED AT HIGHER OF: 1) TWICE THE RATE, BEING SPECIFIED IN SECTION 206C; 2) 5%. |
IN CASE, THE PROVISION OF SECTION 206AA IS ALSO APPLICABLE TO SPECIFIED PERSON APART FROM THIS SECTION, TDS BE DEDUCTED AT THE RATE HIGHER OF RATES DETERMINED U/S 206AA & 206AB.
| WHERE THE PROVISION OF SECTION 206CC IS ALSO APPLICABLE TO A SPECIFIED PERSON, APART FROM THIS SECTION, TCS BE COLLECTED AT THE RATE HIGHER OF RATES DETERMINED U/S 206CC & 206CCA |
THE SECTIONS SHALL BE EFFECTIVE FROM 1st JULY 2021. |
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