E-Taxation

E-Taxation

1. Subject - Cyber Laws & Rights M. tech. 3 rd Sem., ISM. By: Prashant Kr. Vats, M.tech., Ph.D. INDIRA GANDHI DELHI TECHNICAL UNIVERSITY FOR WOMEN

2. E-Taxation

3. Tax Information Network (TIN ) Tax Information Network (TIN) is an initiative by Income Tax Department of India (ITD) for the modernization of the current system for collection, processing, monitoring and accounting of direct taxes using information technology. TIN is a repository of nationwide Tax related information, and has been established by NSDL e-Governance Infrastructure Limited on behalf of ITD.

4. TIN  System

5. TIN has two key sub-systems: Electronic Return Acceptance and Consolidation System (ERACS)  which consists of an infrastructure for interface with the taxpayers (a nation wide network of TIN-Facilitation Centres i.e. TIN-FC) and a web-based utility for upload of electronic returns of Tax Deduction at Source (TDS) & Tax Collection at Source (TCS) and Annual Information Return (AIR) to the central system of TIN. Online Tax Accounting System (OLTAS)  for daily upload to the central system, the details of tax deposited in various tax collecting branches across the country.

6. Services  through TIN-FC Through its network of TIN-Facilitation centres all over the country, TIN offers the following services: Acceptance of electronic and physical TDS/TCS Returns. Processing of new PAN and PAN change request applications. Processing of new TAN and TAN change request applications. Acceptance of AIR Acceptance of Form 24G statement

7. Online   Services of TIN TIN provides the following Online Services through its website : Quaterly  Statement Status Facility for deductors to verify status of e-TDS/TCS statements submitted to TIN-FC by providing TAN and respective Provisional Receipt Number (PRN). e-tax  Payment Facility to pay tax online, wherein the taxpayer can fill up and submit the challan through Internet. The tax payer has to necessarily have a bank account with Net-banking/Debit card of the selected Bank. OLTAS   Challan Status Enquiry Facility for tax payers to enquire online about the status of challans deposited in banks. PAN Facility to apply for PAN online Reprint of PAN card with existing/revised details Status enquiry

8. Online   Services of TIN TIN provides the following Online Services through its website : TAN Facility to apply for TAN online Reprint of TAN allotment letter with existing/revised details Status enquiry e-RI Facility to register as an e-Return Intermediary (e-RI). (An e-RI is an entity authorised by ITD to electronically file income tax returns on behalf of tax payers.) Status enquiry Online  PAN Verification Facility to verify PANs online to authorized entities (Entities who are approved by ITD can verify PANs online). Status enquiry Form  24G Receive Form 24G statements from Account Offices (AO/PAO/DTO) and upload them to the TIN central system

9. Online Services provided by TIN

10. e-TDS/e-TCS  Overview e-TDS Entities (both corporate and non-corporate deductors ) making payments (specified under Income Tax Act) to third parties ( deductees ) are required to deduct tax at source (Tax Deducted at Source -TDS) from these payments and deposit the same at any of the designated branches of banks authorised to collect taxes on behalf of Government of India. They should also furnish TDS returns containing details of deductee (s) and challan details relating to deposit of tax to ITD. As a part of automation of collection, compilation and processing of TDS returns ITD has notified an  "Electronic Filing of Returns of Tax Deducted at Source Scheme, 2003" . It is applicable to all deductors furnishing their TDS return in electronic form. As per this scheme: It is mandatory ( w.e.f . June 1, 2003) for corporate deductors to furnish their TDS returns in electronic form (e-TDS return). From F.Y. 2004-2005 onwards furnishing TDS returns in electronic form is also mandatory for government deductors in addition to corporate deductors . Deductors (other than government and corporates ) may file TDS return in electronic or physical form. NSDL e-Governance Infrastructure Limited (NSDL) as the e- TDS Intermediary (appointed by ITD) receives, on behalf of ITD, the e-TDS returns from the deductors .

11. e-TCS TCS means collection of tax at source by the seller (collector) from the buyer ( collectee /payee) of the goods (specified u/s 206C of Income-tax Act, 1961, like timber obtained under forest lease, scrap, any other forest produce not being timber or tendu leaves etc.,). For e.g. if purchase value of goods is Rs.10,000/-, the buyer will pay an amount of Rs.10,000/- + X (X being the value of TCS as prescribed under Income-tax Act, 1961) to the seller. The seller will deposit the tax collected at source (TCS) at any of the designated branches of the authorised banks. Following the automation of TDS returns in 2003, ITD has now notified an  "Electronic Filing of Returns of Tax Collected at Source Scheme, 2005".  . It is applicable to all deductors furnishing their TDS return in electronic form. As per this scheme: It is mandatory for corporate and government deductors to furnish their TCS returns in electronic form (e-TCS return) from F.Y. 2004-2005 onwards. Deductors (other than government and corporates ) may file TCS return in electronic or physical form. NSDL as the e-TCS Intermediary (appointed by ITD) receives, on behalf of ITD, the e-TCS returns from the deductors . Deductors /Collectors can submit e-TDS/TCS returns through TIN-Facilitation Centres (TIN-FC) established by NSDL or may directly file at e-Filing portal.

12. Annual Information Return (AIR)   Annual Information Return (AIR) of 'high value financial transactions' is required to be furnished under section 285BA of the Income-tax Act, 1961 by 'specified persons' in respect of 'specified transactions' registered or recorded by them during the financial year. The due date of filing of the return is the 31st of August of the following year. The 'specified persons' and the 'specified transactions' are listed in Rule 114E of the Income-tax Rules, 1962.

13. TAN (Tax Deduction and Collection Account Number ) TAN or Tax Deduction and Collection Account Number is a 10 digit alpha numeric number required to be obtained by all persons who are responsible for deducting or collecting tax. Under Section 203A of the Income Tax Act, 1961, it is mandatory to quote Tax Deduction Account Number (TAN) allotted by the Income Tax Department (ITD) on all TDS returns. Since last few years ITD has revised the structure of TAN. It is a unique 10 digit alphanumeric code. Accordingly, they have issued TAN in this new format to all existing TAN holders. To facilitate deductors find their new TAN, ITD has now introduced a search facility in their website ( www.incometaxindia.gov.in ). Through this facility deductors can search on their name and old TAN to find the new TAN. Deductors are advised to find the new TAN from this site before it is incorporated in their e-TDS return file to avoid any inconvenience at the time of furnishing e-TDS return.

14. PAN (Permanent Account Number) Permanent Account Number (PAN) is a ten-digit alphanumeric identifier, issued by Income Tax Department. Each assessee (e.g. individual, firm, company etc.) is issued a unique PAN . With effect from April 08, 2012, PAN applications are required to be furnished in the new forms prescribed by ITD. Indian citizens will have to submit their ‘Application for allotment of new PAN’ in revised Form 49A only. Foreign citizens will have to submit their ‘Application for allotment of new PAN’ in newly notified Form 49AA only. For New PAN applications, in case of Individual and HUF applicants if Address for Communication is selected as Office, then Proof of Office Address along with Proof of residential address is to be submitted to NSDL e-Gov w.e.f . applications made on and after 1st November 2009. As per RBI guidelines, the entities making e-commerce transactions are required to provide PIN (Personal Identification Number) while executing an online transaction. Accordingly, before making payment for online PAN/TAN applications using credit/debit card, please ensure that the PIN is obtained from your respective Banks.

15. OLTAS Overview Income Tax Department's initiative to receive information and maintain records of tax paid through banks through online upload of challan details is named as OLTAS (Online Tax Accounting System). Data  Upload by Banks Income Tax Department has devised the file formats for uploading data regarding tax payment. Banks are expected to generate and upload tax data as per these formats. Once the file has been prepared as per the file format, it can be verified for correctness of its structure using the File Validation Utility (FVU) provided by NSDL.

16. e-Payment of Taxes E tax payment refers to the online payment of tax. Income Tax Department of India has digitalized the tax payment system that allows taxpayers to pay their tax liability via the online portal of e-payment . You can pay e tax online by visiting the portal of e-Payment for TIN ( https //onlineservices.tin.egov-nsdl.com/ etaxnew /tdsnontds.jsp ). Select the relevant challan or form, fill in and make the submission. After the form has been submitted, you will be directed to the net banking page, where you can make the payment .

17. e-Return Intermediary Income Tax Department (ITD) has launched a new scheme for improving interface with the taxpayers. This scheme titled "Electronic Furnishing of Return of Income Scheme, 2007" enables authorized intermediaries to electronically file Income Tax returns on behalf of the taxpayers. This scheme is available to any taxpayer who is assessed or assessable to tax.

18. Online PAN Verification Overview To enable eligible Entities verify Permanent Account Numbers (PANs), Income Tax Department (ITD) has authorized NSDL e-Governance Infrastructure Limited (NSDL e-Gov ) to launch an online PAN verification service for verification of PANs by authorized entities. Entities who can avail of this facility: Investment Advisor approved by SEBI Banks Insurance Web Aggregators Non Banking Financial Companies approved by RBI Prepaid Payment Instrument Issuers approved by RBI Housing Finance Companies Insurance Company Insurance Repository Companies and Government deductor (Required to file TDS/TCS return)* Mutual Funds Credit card Companies / Institutions Central Recordkeeping Agency of National Pension System

19. Online PAN Verification DSC issuing Authorities Depository Participants Credit information companies approved by RBI KYC Registration Agency (KRA)/Central KYC Registry Educational Institutions established by Regulatory Bodies Companies (Required to furnish Annual Information Return (AIR)/Statement of Financial Transaction (SFT) Any other entity required to furnish Annual Information Return (AIR)/Statement of Financial Transaction (SFT) Stock Exchanges/Commodity Exchanges/Clearing Corporations Goods and Services Tax Network Depositories Government Agencies (Central/State) Income Tax Projects Reserve Bank of India Department of Commercial Taxes Stamp and Registration Department Central Vigilance Commission Payments Bank approved by RBI

20. Services of Online PAN Verification This service has three modes of verification: Screen based verification File and Screen based Verification Software (API) based verification (1) Screen based verification: The users, after login, can furnish up to a maximum of five PANs in the screen provided. The PANs may be entered in the boxes provided in the screen and then submitted. The response giving details of PAN will be displayed in the response screen. (2) File and Screen based Verification: The users, after login, can upload a file containing maximum of 1000 PANs (file structure as specified by NSDL e-Gov ). The site will make available, within 24 hours, a response file containing details of the PANs. In case, file format is incorrect, the system will convey the rejection within 24 hours. The entity can download the response at his convenience up to 15 days. (3) Software (API) based PAN verification: The facility is an interface that allows the user to make an online verification of PAN by accessing the verification-site through a software application.

21. Response to the User by Online PAN Verification PAN being verified          Details/response provided in PAN Verification Valid PAN PAN status Name of the PAN holder Last date of PAN update *Name printed on PAN card * Aadhaar seeding status Valid PAN with events such as merger, acquisition etc. PAN status along with event Name of the PAN holder Last date of PAN update *Name printed on PAN card Deleted or Deactivated Only status will be shown as "Deleted" or "Marked as Deactivated" and no other details will be displayed Fake PAN Only status will be shown as "Marked as Fake" and no other details will be displayed PAN not found in database The message  "not present in ITD database"  will be displayed. In such cases, if the user is able to provide a proof of this PAN (copy of PAN card or PAN allotment letter), NSDL e-Gov will forward the same to ITD for investigation.

22. form 24G   The  form 24G  is an electronic document used for income tax filing purposes. This document is filed while we calculate the income tax for the current financial year. It is mandatory for citizens who fall under the tax bracket to file the  Form 24G  from the income tax department under notification number 41/2010.

23. TIN AIN ( Account  Office  Identification Number ) Introduction. Registered Accounts Offices (AOs) can file Form 24G Statements through AO Account ( AIN  Online registration) at  TIN  website. No charges are payable for the Pay and Accounts Office (PAO) for online Upload of Form 24G . What is account identification number? AIN or  Account  Office  Identification Number  is a special 7 digit  identification number  provided to each  accounts  office by the Directorate of the Income Tax System, Delhi. It is mandatory for every  Accounts  Office to have an  Account Identification Number  while submitting Form 24G.

24. Status Tax Refunds Refund  Banker The 'Refund Banker Scheme,' which commenced from 24th Jan 2007, is now operational for Non-corporate taxpayers assessed in Delhi, Mumbai, Kolkata, Chennai, Bangalore, Bhubaneswar, Ahmedabad , Hyderabad, Pune , Patna, Cochin, Trivandrum, Chandigarh, Allahabad, and Kanpur. In the 'Refund Banker Scheme' the refunds generated on processing of Income tax Returns by the Assessing officers/ CPC-Bangalore are transmitted to State Bank of India, CMP branch, Mumbai (Refund Banker) on the next day of processing for further distribution to taxpayers. Refunds are being sent in following two modes: RTGS / NECS:  To enable credit of refund directly to the bank account, Taxpayer.s Bank A/c (at least 10 digits), MICR code of bank branch and correct communication address is mandatory. Paper Cheque:  Bank Account No, Correct address is mandatory. Taxpayers can view status of refund 10 days after their refund has been sent by the Assessing Officer to the Refund Banker - by entering 'PAN' and 'Assessment Year' below. Other  Refunds Status of 'paid' refund, being paid other than through 'Refund Banker,' can also be viewed at www.tin-nsdl.com by entering the 'PAN' and 'Assessment Year' below. 'Refund paid' status is also being reflected in the 'Tax Credit Statements' in Form 26AS.

25. TDS on Payments to Resident Contractors and Professionals Introduction As per Finance Bill of 2019, "TDS on PAYMENTS TO RESIDENT CONTRACTORS AND PROFESSIONALS" is applicable to Individuals and HUFs (Hindu Undivided Family) making ‘Payments to Resident Contractors and Professional’ value greater than 50,00,000 . Section 194M of the Income Tax Act, 1961 states that for all the transactions with effect from September 1, 2019, Tax @ 5% should be deducted by the Payer/ Deductor at the time of making ‘Payments to Resident Contractors and Professional’ Tax so deducted should be deposited to the Government Account through any of the authorized bank branches.

26. OLTAS- Challan Status Inquiry Challan Status Enquiry for Tax Payers : Using this feature, tax payers can track online the status of their challans deposited in banks . This offers two kind of search. a) CIN based view : On entering Challan Identification Number (CIN i.e. details such as BSR Code of Collecting Branch, Challan Tender Date & Challan Serial No.) and amount (optional),the tax payer can view the following details : BSR Code Date of Deposit Challan Serial Number Major Head Code with description TAN/PAN Name of Tax Payer Received by TIN on (i.e. date of receipt by TIN) Confirmation that the amount entered is correct (if amount is entered) b ) TAN based view : By providing TAN and Challan Tender Date range for a particular financial year , the tax payer can view the following details :CIN Major Head Code with description Minor Head Code Nature of Payment If the tax payer enters the amount against a CIN, the system will confirm whether it matches with the details of amount uploaded by the bank.

27. OLTAS- Challan Status Inquiry Challan Status Enquiry for Banks Using this features, tax collecting branches and the nodal branches can track online the status of their challans deposited in banks as follows : a) Collecting Bank Branch : On providing the branch scroll date and the major head code - description, the tax collecting branch can access the total amount and total number of challans for each major head code. Further, the collecting branch can view following details : Challan Serial Number Challan Tender Date PAN/TAN Name of Taxpayer Amount Date of receipt by TIN b) Nodal Bank Branch : On providing the nodal scroll date and the major head code-description, the nodal branch can view the following details : Nodal Branch Scroll Number Scroll Date Major Head Code - Description Total Amount Number of Branches Number of Challans Further, for each Nodal Branch Scroll Number, following information can be accessed:BSR Code Branch Scroll Number Branch Scroll Date Total Amount Number of Challans Date of receipt by TIN

28. Equalization Levy As per Finance Bill of 2016, Equalization levy is applicable for certain specified services related to digital domain wherein the amount of consideration exceeds a specified value (threshold prescribed by Income Tax Department). Rules to The Finance Act, 2016 states that with effect from July 1, 2016, equalization levy @ 6% should be deducted by a resident or non-resident (having permanent establishment in India) on the amount of consideration paid or payable to the non-resident not having permanent establishment in India.

29. TDS on Rent of Property Introduction As per Finance Act, 2017, “TDS on Rent” under section 194-IB is liable to be deducted by Individuals or HUFs (Hindu Undivided Family) (other than an individual or a HUF, whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such income by way of rent is credited or paid) responsible for paying to a resident monthly rent exceeding 50,000. Section 194-IB of the Income Tax Act, 1961 states that for all the transactions with effect from June 1, 2017, tax @5% should be deducted by the Tenant/ Lessee/ Payer of the property at the time of making payment of rent (to Landlord / Lessor / Payee). Tax so deducted should be deposited to the Government Account through any of the authorized bank branches.

30. Utility of TIN Website It can be used for Online Applying for PAN Application Online Applying for TAN Application e-Tax Payment

31. Online PAN Application NSDL e-GOV dispenses PAN services through a chain of TIN-Facilitation Centers (TIN-FCs) and PAN centers established by NSDL e-GOV across the country. Applications can also be made over internet through an online facility . There are three types of applications: 1) Application for allotment of PAN (Form 49 A) This application should be used when the applicant has never applied for a PAN or does not have PAN allotted to him. 2) 'Request for New PAN Card or/and Changes or Correction in PAN data' This application should be used when PAN has been allotted already to applicant but a new PAN card is required or when data associated with the PAN (e.g. name of applicant / date of birth / address) is required to be updated in the records of Income Tax Department. 3) Application for allotment of PAN (Form 49AA) - applicable for foreign citizens This form should be used when the applicant has never applied for a PAN or does not have PAN allotted to him. An applicant can visit Income Tax Department (ITD) website to find whether a PAN has been allotted to him or not.

32. Online TAN Application Every person who requires to deduct tax while making payment to any other person has to obtain TAN. Under Section 203A of the Income Tax Act, 1961, it is mandatory to quote Tax Deduction Account Number (TAN) allotted by the Income Tax Department (ITD) in all TDS returns and Challans while depositing the tax in designated Bank . There are two types of applications: 1) Application for allotment of TAN (Form 49 B) In case you do not have a TAN, you can submit Form 49B which is the application form for issuance of TAN at the TIN Facilitation Centers established by NSDL or can apply online. 2) 'Request for New TAN Card or/and Changes or Correction in TAN data' In case you want Change or Correction in data associated with your reformatted 10 digit TAN, you can use the "form for Change or Correction in TAN data" prescribed by ITD. You can submit a duly filled-in application to any of the TIN-FCs managed by NSDL or can apply online.

33. e-Tax Payment  e-Tax Payment facilitates payment of direct taxes online by taxpayers. To avail of this facility you are required to have a Net-banking/Debit card of the selected Bank. To pay e-Tax, select the relevant challan i.e. ITNS 280, ITNS 281, ITNS 282 or ITNS 283, ITNS 285, ITNS 286, ITNS 287, Form 26QC, Form 26QB, Form 26QD, Demand Payment for Form 26QC or Demand Payment for Form 26QB as applicable. Enter PAN / TAN as applicable. There will be an online check on the validity of the PAN / TAN entered. If PAN/ TAN is valid, you will be allowed to fill up other challan details like accounting head under which payment is made, name and address of TAN and also select the bank through which payment is to be made, etc. On submission of data entered, a confirmation screen will be displayed. If you confirm the data entered in the challan , it will be directed to the Banks payment gateway i.e. Net-Banking/Debit Card web page. Login to the Net-Banking site with the user ID/ password provided by the bank for Net-Banking purpose. In case you have selected the Debit card option, please enter the required card details. On successful login, enter payment details at the bank site. On successful payment a challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made.

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