MAJOR TAX CHANGES YOU NEED TO KNOW ABOUT!

Modern technology has offered a large amount of transparency, comfort, and flexibility in the business systems, from holding meetings through video conferencing to signing documents digitally to fulfilling compliances through the internet seems a lot normal and possible for the businesses now, with no longer required to stand on queues in government offices in the past. In the past year too, we witnessed a lot of changes being announced and introduced in the business systems to resolve issues, lessen compliances, and further encourage continuation despite the ongoing global pandemic. Some of the appreciable were “Vivad se Viswas Scheme”, “Transparent Taxation”, Companies Fresh Start Scheme, and financial support and encouragement schemes like “PradhanMantri Mudra Yojana”, Credit Guarantee Trust Fund For Micro & Small Enterprises (CGT SME), ZED certification scheme, Credit Linked Capital Subsidy for Technology Upgradation (CLCSS), etc.

Now, as per the recent notifications by the CBDT & CBEC respectively, both the departments have undergone some major changes on their respective online portals for better facilitation of services. Following are some details regarding the same-

1. CHANGES INTRODUCED IN THE GST REGIME-

In the recent notification, the GST Department has allowed further flexibility to taxpayers functioning under the Quarterly Return Filing and Monthly Payment of Taxes (QRMP) GST scheme, who now will be able to declare invoices with reference to the movement of goods and services in their quarterly return form GSTR 1 which is required to be filed in the last month of each quarter.

Such taxpayers functioning under the QRMP scheme will be allowed an optional facility namely “the Invoice Furnishing Facility” or IFF for the purpose of filling the invoice and will not be available for filling after the end date (13th of the month succeeding the IFF period. Such taxpayers will file an invoice under IFF in the first two months of the quarter and file Form GSTR-1 in the third month of the quarter. Therefore, such taxpayers willing to opt for the IFF facility have been advised to declare such a document in the GSTR-1 for the quarter in advance.

Further, as per the advisory issued by the GST department under the goods and Services Tax Network (GSTN) functionality, it shall be the responsibility of the taxpayer to always ensure that the documents saved but not filed documents under the IFF facility records in the first two months of the quarter must be removed after adding the same in the final quarterly return but prior to filing the final return for the quarter in the form GSTR-1 using the using RESET button for some time until and unless more functionalities are enabled for proper management of the records saved through IFF records.

2) CHANGES INTRODUCED IN INCOME –TAX PORTAL

With the beginning of a new financial year, the Income –Tax department has further strived to make it easier for the taxpayers to file and submit their ITR forms for the year 2021-22. As a general norm, the taxpayers need to file and submit their tax returns for the year 2020-21 by July 31, 2021, until and unless an extension for the same is notified by the Government.

For those unknown, the Income-tax department has initiated certain changes in the functionality of the Income-tax portal by discontinuing the Excel and Java version of ITR utilities and replacing them with the introduction of JSON utility and along with it, a step-by-step procedure for the application of the new utility.

The JSON or the (JavaScript Object Notation) utility is an offline utility based on new technology for whose application, the taxpayers shall have to download the pre-filled data from the income tax e-filing portal and import the same on the new utility, which will enable the taxpayer to edit and save returns, pre-filled data, and profile data in the process.

The key takeaways from the latest notification provide the following-

i.    Taxpayers will have the facility to view and download pre-filled data from the income tax e-filling portal and fill in the remaining details on the same. Such imported pre-filled date shall be subject to requisite alterations by the concerned taxpayer.

ii.    However, certain details like the Permanent Account Number (PAN) could not be changed and wherever required to change the same, the taxpayer will have to edit the same on the portal and then again re-download the same. 

iii.    This utility could be used for filling ITR1 to ITR4 and later will be available for all ITR forms.

Additionally, as per the notification, it shall be mandatory for the taxpayer to import such a pre-filled file from the income-tax portal while filling and submitting the tax returns. Further, to make the process of filling and submission of the ITR easier enough for a taxpayer to easily identify the applicability, the IT Department will release subsequent forms (except forms from ITR-1 to ITR-4) on a questionnaire-based functionality empowering them to verify upload ITR and make tax payments on their own.

Conclusion:

Thus, it could be safely said that the government is working continuously to raise awareness towards the timely payment of taxes, to curb dishonest practices of tax-related frauds, simplifying tax procedures, and creating a taxpayer-friendly tax regime. Such efforts made by the Government to build a favorable tax regime for taxpayers cannot be disregarded and will definitely go on a long way in boosting simplicity and removing obstructions in stimulating compliances and promoting good governance.

Author:

eStartIndia Team