Tax Saving Tips for Government Employees’ Income (FY 2019-20)

Income Tax Saving Tips for Salaried Person

Expenses are planned after ensuring the earnings. One must also know the amount which will be levied by the government in the name of tax. The write-up highlights some key pointers for salaried employees according to which they can ensure their exact tax outgo.

With Gross Income of Less than Rs. 5 Lakhs

As per the recently introduced amendments, employees whose yearly aggregate is less than Rs. 5 Lakhs can avail for zero tax benefit and claim a rebate of all the taxable income under section 87A in Assessment Year 2020-21. Gross Total Income includes income from salaries, income from property, LTCG, interest from banks and other sources.

Read Also: Tax Clarification in Case of Income upto INR 5 Lakh

It is even beneficial for you to deposit your money in a bank or co-operative society as the yearly interest on such deposits is less than Rs. 40,000 which means no TDS deducted from banks on such accounts.

Deductions on Property Occupied

Under section 24B of IT Act, you can avail for deduction of Rs. 2 Lakhs on the interest for a House loan which will be self-occupied. You can even avail of a joint housing loan with your spouse so that you both can get the deductions of 2 Lakhs each on loan interest. 

Recommended: Income Tax Benefits on Housing Loan in India

Mentioned in Section 8EEA, the deduction on the interest for Residential property loan is increased to Rs. 1,50,000 which earlier was Rs. 50,000 only. The loan should be taken from 01-04-2019 to 31-03-2020.

National Pension Scheme

On closing or opting out of the NPS, 60% of the corpus paid by the NPS trust is tax-exempt. One must contribute 14% of their monthly salaries to NPS for availing high benefits at the time of receiving the lump sum. Even if you do not match the criterion of the NPS scheme, you can opt for NPS in Banks or Post Offices.

Accuracy in Tax Compliance

Make sure you comply with each and every policy of the tax governance while filing returns to avoid penalties or any futile scrutiny by the tax officers. Returns filed must be concrete and not doubtful.

Bring in practice the use of e-filing and Electronic Payment Modes for smooth and speedy tax compliance.

Use your PAN or Adhaar Card as proof while deducting TDS. No PAN or Adhaar will invite 20% TDS instead of 5%. Link your PAN with your Aadhaar Card.

Lower Down Taxable Income Via Sections of the IT Act

You can further lower down your taxable income by availing the following deductions from your Gross Total Income (mentioned in Chapter VIA of Income Tax Act)

Section 80C – Deduction on the payment of the LIC premium under the name of self, spouse, son, daughter is up to Rs. 1,50,000. The deduction depends upon the nature of the policy adopted by the LIC premium payer. No deduction on the LIC premium is decided for persons except the ones mentioned above. Other deductions covered under section 80C are tuition fees, contribution to GIS, SLI and Government Provident Fund.

Under section 80CCD, an additional deduction of Rs. 50,000 is available except for Rs. 1,50,000  for the benefit of an assessee. Hence making the sum of deduction reach up to Rs. 200,000.

Section 80D – Individual or HUF can claim deduction on health insurance taken by them. 

For Health Insurance, the structure is as follows:

  • i. Self and family (Including Senior Citizen)-Maximum Rs.50,000
  • ii. Parents –Maximum Rs. 25,000
  • iii. Parents (Senior) –Maximum-50,000
  • iv.Self and Family including Parents –Maximum Rs. 50,000
  • v. Self and Family including Senior citizen Parents –Maximum Rs. 75,000.

For Medical Expenditure, the structure is as follows:

  • I.  Self and family (Senior Citizen)-Maximum Rs.50,000
  • ii. Parents (Senior) –Maximum Rs.50,000
  • iii. Self and Family including Parents –Maximum Rs. 50,000.

To be noted: Payment through cash is not accepted under sec 80D.

Section 80GGC – Mentioned in the section are deductions on contribution done by any citizen to Political Parties or Electoral Trusts. The person can be anyone except local authority or any other judicial person who is partially or fully funded by the government. The total income of people contributing is eligible for deductions. 


Contribution in the form of cash will be barred from any deductions.

Refer IT official portal for details regarding Donations:

  • a. Without qualifying Limit -100%
  • b. Without qualifying Limit- 50%
  • c. With qualifying Limit -100%
  • d. With qualifying  Limit-50%

Section 80TTA – Interest on savings account from any Bank, co-operative society or Post Office is eligible for deductions up to Rs. 10,000. The deduction can be availed by any individual or HUF. 

Section 80TTB – The government offers a good sum of benefits for senior citizens above the age of 60 years. The person can claim a deduction up to Rs. 50,000 on the interest from deposits in banks, co-operative society and post offices.  

Section 80U – Deductions for persons with any disability. The maximum deductible amount on disability is Rs. 75,000 and on severe disability is Rs. 1,25,000 respectively. 

Income Tax Slab Rates as Per FY 2019-20

A.Rates as per Part III First Schedule to the Finance Act 2018

Upto Rs. 250,000Nil
Rs. 250,001 to Rs. 500,0005 per cent
Rs. 500,001 to Rs. 10,00,00020 per cent
Above Rs. 10,00,00030 per cent

B. For an individual of age 60 year or more but less than 80 years

Up to Rs. 300,000Nil
Rs.300,001 to Rs. 500,0005 per cent
Rs. 500,001 to Rs. 10,00,00020 per cent
Above Rs. 10,00,00030 per cent

Stress Upon Cutting Higher GST Rates on Aluminium Vessels

GST Rates on Aluminium Vessels

Vessels are very common yet essential in every kitchen. No family in the country is unaware of its usage, importance and noise. A similar echo is in Union Government appealing to reduce GST on vessels.

Deputy Speaker Pollachi V. Jayaraman who attended the annual meeting of the federation on Sunday told media that the vessel manufacturing industry is one of the renowned industries in the nation as vessels are widely used in houses, hotels, restaurants for cooking and serving purposes.

The industry, despite being of high importance is depressed due to high GST rates, shortage of workers and high cost of raw materials. The vessels are manufactured mainly in Coimbatore, Chennai, Salem and Madhurai. Stressing upon the current situation, members of the federation appealed to the Union Government to reduce GST on aluminium vessels.

Items like aluminium utensils are not among the luxurious products and therefore a lower GST slab should be defined for such commodities, says CAIT also to social media.

Many industries including vessels and auto parts manufacturers are pleading for relief from such high GST rates which are ultimately leading to a slowdown in sales.

About 150 key officials from different parts of the nation attended the meet which even discussed the latest technologies and amendments in favour of such industries.

Read Also: GST Impact on Aluminium Scrap Industry in India

However, it is to be seen how the government will cope up the request of the community for the rate reduction as there is already a tax collection burden on the union government.

Apart from the GST rate cut, the auto industry is also on the same track and want some relief from the additional taxes on the industry

The upcoming GST council 37th meeting which is to be held on 20th September in Goa may discuss some of the topics on GST rate cut.

All Key Changes Highlighted of New GST Return Forms

Key Changes New GST Return Forms

The GST Council, along with the government, has accepted a new set of GST return forms with the aim to remove the ongoing issues and simplify the overall return process. The new forms would be implemented from 2019.

A number of changes have been made in the new GST forms, which are being explained here. Source: Harpreet Singh, Partner at KPMG India.

Five Major Changes in the Upcoming GST Returns

  • The first change is in the form of a reduced number of returns. The Council has decided to replace the existing multiple returns with a single return filing. So now, there would be one return filing against multiple returns which are filed presently. As of today, we file multiple returns, including GSTR-1, GSTR-3B, GSTR-2A (for reconciliation purpose), etc. All these will be replaced with one return form.
  • The new return will be simpler than what we have today. The simpler return will only have 5 to 6 tables, one of which will contain details of supply and one is for purchase/input details. Another benefit is that the information in both these tables will be auto-populated, based on the invoices uploaded by the taxpayers. Around 80% of the tables will auto-fetch data from invoices. The dealer will only have to fill the remaining 20% details.
  • Another change is a new return filing method through SMS. The portal will soon start the facility to allow taxpayers to file their GST returns through SMS.
  • Also, there is a change in the way dealers could amend their returns. As of today, there is no provision to amend a return once it is filed. Upon receiving several requests from dealers for introducing a provision for amendments, the Council has decided to do it. The new return filing system would allow taxpayers to amend each of their returns twice and also report negative balance or liability.
  • The new system will have profile-based dealer’s filing of returns. That means a dealer’s profile will be selected based on which they will fill out a questionnaire and proceed to file the return.

Singh summarizes the new return as “upload – lock – pay” system where suppliers upload their invoices (and provide return details), the recipients accept them and thus lock the returns and then the GST is paid.

As for the Sahaj and Sugam schemes, Singh goes on explaining that the option is for dealers whose annual turnover is less than 5 crores and file quarterly returns. Such dealers can either continue with quarterly returns or they can opt for a simpler two return system – one is Sahaj return and another one is Sugam return.

Read Also: Free Download Gen GST Software for Simple GST Return Filing

Sajah return is for B2C suppliers. It is a much simpler return with less number of fields and easy to file. It will be filed monthly. Sugam is for those dealers who are involved in both B2B and B2C supplies. Rest process is the same. The Sajah and Sugam option are only available to dealers with less than 5 crore turnover.


Steps to Revise TDS Return When Receive PAN Error Notice

Steps to Revise TDS Return

TDS return becomes defective if the PAN entered at the time of filing return is wrong. Once you make such a mistake, the next step is obviously to revise the return.

An applicant receives a notice from the Income Tax Department on submitting the wrong PAN, and then he needs to file a revised return.

While Filing a Revised TDS Return, Following Points Must be Kept in Mind:

1. A justification report needs to be generated from Traces after receiving notice from IT dept. If the reasons mentioned are not duly disclosed.

Steps to Generate a Justification Report:

  • Step1: Login to the traces
  • Step 2: Select the option “Request For Justification Report Download,” given in the defaults Tab.
  • Step 3: Enter the details in the justification report.
  • Step 4: Check the status of Justification Report by clicking “Requested Download” given in the Download Tab.

2. The Justification report is in text format, and it needs to be converted using TRACES Justification Report Generation Utility.

Read Also: Filing Revised TDS Return Online: Step by Step Guide

Steps to Convert the Justification Report:

  • Step1: Login to the traces.
  • Step 2: Go to Requested Downloads under Downloads and click “Click Here.”
  • Step 3: Click on TRACES Justification Report Generation Utility v2.2.

3. Go to console file option present in statements tab and click on it, after finding detailed reasons in justification report. Download the console file and enter the password. The password to access Console File would be ‘TAN_’ (e.g., ABCD12345E_67890).’

4. Download the latest RPU utility form TIN NSDL after downloading the console file. Now, open console file in that utility in correction section. Once done, import the console file, downloaded from traces, and make corrections in the file when it gets opened.

5. Once you update PAN details in RPU utility, click on the save button and once data gets saved click on “Create File.” The window similar to the one given below will appear:

6. In the open window, enter the .csi file in the first column. Generate the .csi file from oltas online. Click on the link and save the same.

7. In the second tab of the open window, enter the path where you want to save the file.

8. In third-tab, browse the console file with .tds, which has been earlier saved from RPU utility.

9. Once, all three files are browsed, validate them all along with FVU file. Once done, Form 27A will generate.

10. Submit both the file, i.e., Form 27A and FVU to authorized TDS vendor. Once done, vendors will file your return accordingly.

States Becoming Roadblock in Rate Cut on Auto Before GST Council 37th Meet

GST Rates on Cars and Accessories

The festive season, a period when Indians usually bring new vehicles to their home, ahead of it, the automakers are seeking to get tax relief in the upcoming 37th meet of GST council on September 20, have encountered a roadblock.

Considering the slowdown in the domestic automotive industry, where the government is ready to slash down the GST rates from prevailing 28 per cent to 18 per cent for the auto sector, the states have come out as a hurdle and opposing this move mulling over a huge loss in revenue collection.

However, on passed Friday, the Fitment Committee, a group of officials of the GST council considered this matter and find out the possibilities and implications of a GST rate cut to restrain this continued slowdown in the domestic automotive industry which does not seem to dwindle soon.

The study’s outcome from the Fitment Committee, suggests a downfall in the revenue collection by over INR 20,000 crore. However, the GST collection in August 2019 was around 4.51 per cent more over the similar month last year at INR 98,202 crore in contrast to INR 93,960 crore. Still, it did not become able to meet the government’s expectations of INR 1 trillion.

On an interesting note, the states which are opposing rate cut in the GST rates for the auto sector are majorly the ones which are the “consuming states”, i.e. Kerala, UP, Bihar and others. Since the GST is a destination tax and higher tax rate results into volume generation from auto sales in these states.

While the states which are big auto-making hubs are supporting the government decision of rate cut so that restraint can be put on the slowdown in the domestic automotive industry.

The assessment conducted by the Fitment committee will be produced at the GST council upcoming 37th meet scheduled to organize on September 20 in Goa. However, there are fewer chances that the issue will reach a decision quickly.

According to a state finance minister who is a member of the GST council as well, touted,”It’s not merely a call of the GST council but a political call as well. If the Centre wants a rate cut to boost the auto sector, it has to get everyone on board.”

On the other hand, the junior minister of finance, Anuraj Thakur at the lately conducted event of Automotive Component Manufacturers Association (ACMA) said, “The government has received requests from various sectors for a GST rate cut and the government has been analysing the demands.”

He further added that the government is intended to produce this matter of GST rates reduction to the GST council. however, the majority of decisions taken there unanimously.

As the states are becoming a hurdle into a revision of GST tax rates, the finance ministry suggested spokesperson of the different sectors approaching state finance ministers/members of the GST council individually so that they can be convinced and can consider their demands.

Now all eyes will be on the GST council meet, wherein the level of consensus over the rate cut issue will only be the factor behind the outcome. If the council fails to take up the issue, it will be referred to the Fitment Committee again.

According to the experts from the auto sectors, only the cut down can help in pulling out industry from the prevailing slowdown through a single window of approaching the season. Also, the automakers believe that the buyers are holding back for the expected special offers with lowered rates during the festive season.

A top official of an auto giant said, “Customers expects us to cut prices. But the automakers are in no position to do so. That’s why the government should clarify the situation as soon as possible. If the tax cut is not coming, the auto industry will have to find other ways to meet consumer expectations.”

The Indian economy is going through a bad phase and the government can’t afford further risks such as revenue losses and a rise in the fiscal deficit. The economy is strictly demanding interventions which can bring some positive changes.

Read Also: Updated – GST Impact on Gross Domestic Product (GDP) in India

In the last quarter, the GDP falls to 5 per cent which brought the government under pressure to manage things as soon as possible by the next quarter to revive GDP growth.

The sales and tax collections in August month remains low due to the monsoon and now any factor that can help in improving sales and consumption in the coming months is being considered as the perfect antidote.

Easy Filing Guide to GSTR 8 Form Online for TCS Collector

GSTR 8 Filing

The GSTR-8 return form is filed by e-commerce companies each month. E-commerce companies are registered under GST regime compulsorily and obtain the registration under tax collection source(TCS). It includes the supplies made by E-commerce platform to the registered, unregistered customer, tax paid, and tax payable. E-commerce operator files the form detailing the amount of tax collected at source from sellers. The GSTR 8 form is also available in PDF format, download and view here.

Eligibility for E-commerce TCS Deduction Under GST

Central Board of Indirect Taxes and Customs (CBIC) cleared that entities having aggregate turnover lower than INR 20 lakhs (or INR10 lakhs in case of specified special category states) in a particular financial year are exempted from having compulsory registration.

  • GSTR 8 Form Features
  • GSTR 8 Due Date
  • GSTR 8 Important Terms
  • Interest on Late Payment
  • Simple Procedure to File GSTR 8

E-commerce Operator Under GST Regime

According to section 43B(d) of the Model GST Law, E-commerce is the platform that allows an online market for different vendors and customers to supply and receive the goods and services. To file GSTR-8 electronically through a common portal, e-commerce operator is needed to be registered under GST.

Salient Features of GSTR-8 Return Form

  • GSTR-8 is filed every registered E-commerce operator
  • Every E-commerce operator file it before the 10th of the next month of tax period mandatorily
  • The details of the GSTR-8 filed by e-commerce operator is available in part D of GSTR 2A to the concerned taxable persons
  • GSTR- 8 has 8 headings. Most of them are auto-populated
  • E-commerce platforms deduct the Tax collection at source(TCS) from the supplier of the goods and services and return to the government
  • E-commerce operators pay 1% TCS on all the goods and services sold out through their platforms

GSTR-8 Eligibility & Due Dates

  • GSTR-8 should be furnished by E-commerce operators every month. The definition under section 43(d) includes the detailing regarding who should be called E-commerce operators
  • e-commerce operator can file the GSTR-8 after the month completes and the last date to furnish the details is 10th of the succeeding month of the tax period.

The due dates for filing GSTR-8 are as follows:

  • July 2019 – 10th August 2019
  • June 2019 – 10th July 2019
  • May 2019 – 10th June 2019
  • April 2019 – 10th May 2019
  • March 2019 – 10th April 2019
  • February 2019 – 10th March 2019
  • January 2019 – 10th February 2019
  • October 2018 to December 2018 – 7th February 2019 | Read Official ROD Here

Important Terms Related To GSTR-8

  • GSTIN: Goods and Services Taxpayer Identification Number
  • UIN: Unique Identification Number
  • UQC: Unit Quantity Code
  • HSN: Harmonised System of Nomenclature
  • SAC: Services Accounting Code
  • POS: Place of Supply of Goods and Services
  • B2B: from one registered person to another registered person
  • B2C: from registered person to unregistered person

Interest on Late Payment of GST & Penalty of Missing the GST Return Due Date

According to the GST council rules and regulations, each subsequent late payment of taxes will accrue 18 percent interest on the GST tax payable starting from due date till the taxes are paid. You can read detailed interest guides in chapter 10, point 50 here:

For Example: If a taxpayer misses the deadline for GST tax payment then there will be interest calculations commencing from the due date i.e. 1000*18/100*1/365= Rs. 0.49 per day approx.

(Rs. 1000 is the assumed tax payment) (18% per annum is the interest rate) (1 day delayed by the taxpayer)

If taxpayers miss the deadline of GSTR filing according to the due dates stated by the GST council then there is a penalty of Rs. 25 for CGST and Rs. 25 for SGST per day (maximum Rs.5000) starting from the due date till the filing is done.

Step by Step Procedure to File GSTR-8 for TCS Taxpayers

Table 1&2: Details of Taxpayer

  • GSTIN: GSTIN stands for Goods and Services Taxpayer Identification Number. The GSTIN is a 15-digit number includes 2-digit state code,10-digit permanent account number, and 3-digit includes state, future use, and check-digit. It is auto-populated when we file returns
  • Name of Taxpayer: This is the name of a taxpayer and this field is also auto-populated at the time of return filing. There is separate option to file the Trade Name if applicable
  • Month-Year(Period): The taxpayer requires to choose the date from drop down for which month and year for which GSTR-8 is being filed      

Table 3: Details of supplies

  • 3A-Fill the details of supplies made through E-commerce portal to the registered person
    • This field is for supplies made through the portal between B2B. Here taxpayer fills the details of the registered supplier who supplies goods and services to registered customers using the portal. It includes GSTIN of the merchant, the gross value of the supply made, the value of supply returned, and net amount reliable to tax
  • 3B-fill the details of supplies made through e-commerce portal to the unregistered person
    • The supplies made between the registered seller and unregistered taxpayer are to be furnished here. It includes all the same field as B2B transaction like GSTIN, the gross value of supply made, the value of returned supply, and other taxes
GSTR 8 Table 3

Table 4: Any amendments to supplies made through e-commerce operator to registered or unregistered person

  • 4A- amendments in table 3A of GSTR-8
    • If there is any modification under in B2B transaction supplies made through e-commerce portal during the previous month, the taxpayer can edit the details using e-commerce portal under Section 4A of the GSTR-8
  • 4B- amendments in table 3B of GSTR-8
    • If there is any modification under in B2C transaction supplies made through e-commerce portal during the previous month, it can be edited under section 4B of GSTR-8
  • Amount of tax collected at source
    • The e-commerce operators furnish this head with detailing of an amount of tax collected at source by B2B and B2C transactions. This is the important heading to be furnished by merchant based on supplies made during the month. It includes integrated tax, central tax, and state/UT tax
GSTR 8 Table 4

Table 5: Details of Interest

  • This field is auto-populated by the above headings and calculate the Tax collected at source, interest on delayed payment of TCS, and the fee for late filing
GSTR 8 Table 5

Table 6&7: Interest/Tax payable and paid

  • This field is auto-populated after filling the above details and shows the details about the tax, Interest, and fees paid or payable to the state and central government
GSTR 8 Table 6
GSTR 8 Table 7

Table 8: Refunds claimed from electronic cash ledger

  • This head is furnished with the refund details claimed from electronic cash ledger and bank account details. This is auto-populated from the previous headings
GSTR 8 Table 8

Table 9: Debit entries in cash ledger for TCS/interest payment (to be populated after payment of tax and submission of return)

  • This field is auto-populated after the payment of returns. It includes tax paid in cash and interest payment to the taxpayers
GSTR 8 Table 9

After furnishing all the information, the taxpayers need to sign electronically to authentic the details filled.

GST on Skill Development Courses is Stinging Employers & Workers

18% GST on Skill Development Courses

18% GST rate on vocational training courses is lacerating for employees as well as employers who impart training & education to their employees as a part of their Customer Social Responsibility (CRS).

According to experts, the applicability of goods and services tax (GST) on workers’ enrollment for the government’s skill development programme is highly castigated as it demotivates workers and industries as well.

At present, the employers sponsoring their employees for vocational training or individual who get themselves enrolling themselves for such courses which will get the job have to pay 18% GST on the enrollment.

Usually, the Finance Ministry plays the role of benefactor and sponsors the training fees, but many companies also provide funds as an element of their CSR to leverage the skills of their workers’. However, the payment of 18% GST on them is aching for the companies.

Read Also: Goods and Services Tax Applicability on Employees Structure

“Students pay for themselves or by sponsors find 18 per cent GST on training fees back-breaking leading to postponement or cancellation of vocational training. The training provider imparts basic vocational training to under-qualified and unskilled youth to make them employable,” said G A Soman, principal of Don Bosco Training Academy in Mumbai and former chairman of Indian Institute of Welding (IIW).

The fee of professional training goes higher when the students enrolling for them have to pay 18% GST along with the course fee and most of the students are from down and out family so it sums up financial complexity for them. The course fee for a basic steel welding is approx Rs 45,000 per student and the training fee in organised sectors like diamond & textile and unorganised sectors like plumbing ranges between 20,000 and Rs 25,000. The tax applicability on them raises the financial burden on students and their families.

IIW has appealed to the government to nullify GST on skill development courses and put them under the GST exempted category. At present, industries such as diamond processing are also encountering hefty GST onus, particularly at the times when the absorption rate decelerates.

“The industry is paying 18 per cent of GST on all processed diamonds certified by a certifying agency. When these certified diamonds are exported, the exporter gets an input credit which stands lower than the GST paid on certification as buyers do not reimburse taxes. This has resulted into GST accumulation and, therefore, blockage of working capital of diamond processors, we have proposed the government to reduce the GST on diamond certification to 5 per cent,” expressed Colin Shah, Vice Chairman, Gems and Jewellery Export Promotion Council (GJEPC).

Recommended: GST Rate Applicable to Educational & Training Services

Expenses borne by diamond processors on training and skill development are subject to reimbursement. The skill development throughout the diamond industry is tracked and managed by the National Skill Development Council (NSDC) which completely waives off the GST from vocational courses.

The Textile Sector Skill Council (TSC) which was set up as a subgroup of National Skill Development Corporation (NSDC) in the year 2014, has enrolled 147,678 trainees under different programmes brought in by it and has certified 135,391 candidates as well-trained professionals. However, at present, the nation’s economic slowdown has disrupted skill development within a new worker as well as trained employees.

“The aim of the government’s Skill India mission was to create professionals for long term. The slow rate of absorption of skilled workers is a temporary phenomenon which would overcome in six months,” statement made by Rahul Mehta, president of Clothing Manufacturers Association of India (CMAI).

Steps to Generate ICAI UDIN Registration for GST & Tax Audit Reports

UDIN Registration and Generation Process

The Institute of Chartered Accountants of India (ICAI) has announced that Unique Document Identification Number (UDIN) would be mandatory for all the certificates, GST and Tax report, and all other audits, attest and assurance functions in phases for ICAI members and practising CAs. The last date of income tax return (Audit Cases) is 30th September for FY 2018-19. The GST audit report GSTR 9C form revised due date is 30th November for FY 2017-18.

The action has been taken by (ICAI Institute of Chartered Accountants of India) to restrict illegal third-parties from representing themselves as official ICAI members to the ICAI Authorities and Stakeholders.

As per the ICAI council 379th meeting held on 17th and 18th December 2018, UDIN registration process for all the ICAI members or practising CAs was implemented in a phased manner:

  • In the 1st phase starting from 1st February 2019, UDIN is mandatory for all certificates issued by Chartered Accountants.
  • In the 2nd phase starting from 1st April 2019, UDIN is mandatory for GST & Tax Audit Reports w.e.f. 1st April 2019.
  • In the 3rd phase, starting from 1st July 2019, UDIN is mandatory for all other audits, attest and assurance functions.

Read Also: How Chartered Accountant Aspirants Motivate Themselves

All the ICAI Members have been advised by the council to strictly follow the given schedule of mandating UDIN and also adhere to the same while conducting various Audits.

It is also vital for all the practising CAs to register on UDIN portal ( and generate UDIN to engage in any kind of Corporate/ Non- Corporate Audit, Attest and Assurance Functions.

In order to authenticate varied documents from Regulators/Banks/Authorities/Other Stakeholders, practising CAs have to issue certificates, containing some financial figures and details. Although the ICAI has made it clear no such certificates would be required to be uploaded on the portal for UDIN generation.

Here is the detailed step-by-step procedure for registration and UDIN generation on the official UDIN website:

Step 1: Visit the page

Step 2: Click on the option “For the First time sign up, click here”

Step 3: Enter details like six-digit Membership No., Date of Enrollment, DOB and click on the “Send OTP” button. An OTP will be sent on the registered mobile and email with ICAI.

Step 4: Click on “Continue”, post entering the correct OTP. Once done, the user will receive a username and system-generated password on the registered mobile and email with the ICAI.

Step 5: Login using the given username and system password. Post login, click “Generate UDIN” option.

Step 6: Provide details like Client Reference Code/Number, Date of Document, Document Issued, Document Description, Keywords/Values (minimum three) within the document, etc.

Step 7: Click on the “Send OTP”. Once done, the user will receive an OTP on the registered mobile and email id.

Step 8: Enter received OTP and click the “Preview” option. You will see the details you have entered for UDIN generation.

Step 9: If any change is required in entered details, click the button “Back” or else click the button “Submit”

Step 10: A UDIN will be generated for Further Use.

FM Foresees DTC Implementation, Considering Deficient Income Tax Collection

DTC Implementation

The last rate for tax return filing for the Fiscal Year 2019 i.e. 31st August seized a sum of 49,29,121 tax returns being filed, as per the statement made to the press by the Income Tax department. The total number of ITRs filed in last four to five days of August is quite impressive and shows 42% rise in comparison to the number of returns filed in the same days of the same month, last year.

However, the period from April to August this year remained insignificant with just 4% hike in income tax return filing as & when compared to the same period of last year.

Although the total number of the Tax return filed is higher than last year, it couldn’t bring good news for the tax officials as the number of ITR filed doesn’t make a huge difference to them but the total amount of tax collected does. Increment in the number of total ITR filed is ordinary for tax officials but the amount of tax collected was critical this time.
Tax collections are lagging far behind then the targets in FY19 and show drastic failure in the initial four months of the Fiscal Year 2020. In April-July, the aggregate tax collection was increased by just 6.6% at 5.4 lakh crore in comparison to 18.3% which is an FY20 Budget target growth. Direct tax collection increased by 5.8% at 2.2 lakh crore in comparison to last year.

The budget estimate for direct tax mop-up growth is fixed at 17.4%. Total corporate and personal tax collections were increased by just 5.4% and 6%, respectively. The nominal and real GDP growth shows a deceleration in Q1FY20 with 195-month low and 75-month low, respectively. If the growth of GDP remains stagnant like this, it will inevitably affect the tax growth adversely.

Read Also: All About Proposal Made for Income Tax Slabs & Rates by Task Force

Emphasis was made on GST collection and simultaneously the budget expectations were toned down where the budgeted collections are fixed to raise with just 3.6% in which the government may also have a little amount of surplus as the collections were increased 6.4% in April-August, 2019.

Considering the nation’s weak tax-compliance, the finance minister is marching forward towards execution of the proposal made for the Direct Taxes Code (DTC) on changes to direct income taxes. Besides, lowering the tax rates, DTC reports will also rationalise the tax rates. For example, the nil tax bracket and 20.8% rate slab for individuals earning an annual income up to `5 lakh and between 5-20 lakh, respectively, leads to a situation when an individual tries to show income less than 5 lakhs if they are earning a few lakhs more than 5 lakhs.

According to the survey conducted a research agency, the total number of individuals earning an annual income more than 1 crore was around 6.4 lakh in FY16 while the latest assessment pegs it at just 81,344.
Similarly, the total number of individuals earning an annual income between 50-100 lakh was summed up to 1.4 lakh in FY16 while the number of individuals has raised to 11.6 lakh as per the price estimation. This implies that more rational the tax rates are, the higher will be the tax collection.

IT Dept Now Helps You Generate PAN While Filing ITR via Aadhaar Card

PAN While Filing ITR via Aadhaar Card

Modi government is consistently introducing amendments in tax laws for the convenience of Indian civilians. It is in news currently that the Income Tax Department will automatically generate Permanent Account Number (PAN) for taxpayers who file their returns using their Aadhaar Number. The rule is a servant to two masters. The provision also caters to the department as in the process all the Income Tax Returns will get linked with the PAN database which will be a rigid data for their tax-related analytics.

As per the contents directly from the desks of CBDT, if any person files an Income Tax Return using his Aadhaar Card, he is deemed to have applied for PAN. He does not have to apply for PAN separately after ITR.

The rule is on its way to ruling from 1 September 2019 through the amendments included in Budget 2019. Taxpayers are benefitted not once but twice as firstly the Income Tax can now be filed using Aadhaar Card and secondly, he will get the PAN (which is a legal identity) automatically generated while filing ITR via Adhaar Card.

Notifications from Central Board of Direct Taxes said that the tax department will extract all the relevant information from the filer’s Aadhaar for PAN allotment. CBDT acts like the governor of the Income Tax Department, this is the sole policy-making body for the tax department.

In July, CBDT chairman PC Modi made it public in an interview with the Press Trust of India that the department is going to allow a new PAN number to the taxpayer who would use Aadhaar for filing Income Tax Return. The process will help to bridge the two databases for a much rigid database.