Covid-19. As a result, the government has announced certain tax benefits and compliance to the taxpayers.
- There will be no tax on the amount received by the employees from the employers or any other person for the Covid treatment. The press release said that, “Many taxpayers have received financial help from their employers and well wishers for meeting their expenses incurred for treatment of Covid-19. In order to ensure that no income tax liability arises on this account, it has been decided to provide income-tax exemption to the amount received by a taxpayer for medical treatment from employer or from any person for treatment of Covid-19 during FY 2019-20 and subsequent years.”
- There will be no tax on ex-gratia payment received by the family member of the deceased employee because of Covid. Along with this, there will also be no tax on the financial help received from the relatives and friends till the aggregate amount is Rs.10 lakh. “This is a welcome and much needed relief brought in by the CBDT. The taxpayers genuinely faced several difficulties whenever they were hospitalised or otherwise subject to rigorous medication. COVID treatment has also turned out to be costly for quite a lot of people. The exemption for amount received for medical treatment will provide some respite and we hope that many taxpayers would get benefitted by this. The exemption of ex-gratia amount received on death is also a good step and will provide some respite to the affected families,” said Amit Maheshwari who is a Tax partner at AKM Global which is a tax and consulting firm.
- The deadline for linking PAN and Aadhaar card has been extended till 30 September from 30 June. A Delhi based Chartered Accountant, Tarun Kumar has said that, “Many people were facing glitches while linking their PAN with Aadhaar at the new Income-tax e-filing portal, therefore the government has now further extended this date to 30th September 2021 from 30th June, 2021.”
- The deadline for making a payment (without additional amount) under Vivad Se Vishwas scheme has been extended till 31st August while the last payment date without additional amount has been extended till 31st October. “The extension of various due dates, be it for PAN-Aadhaar linking, for payment of tax/penalty under Vivaad Se Vishwas scheme, completion of assessment proceedings, completion of penalty proceedings, registration of charitable trusts and institutions of income tax exemption,etc. Will provide additional time, both to taxpayers as well as tax authorities for meeting the timeline,” says Shailesh Kumar who is a Partner at Nangia & Co LLP.
- Tax Compliance deadline to save capital gains tax has been extended. Tax Compliance deadline falling between 1 April, 2021 and 29 September 2021, for making investment, deposit, payment, acquisition, purchase, construction or other action to save tax under provisions contained in Section 54 to 54GB of the Income Tax Act, has been extended till 30 September 2021. “So suppose if you were required to make an investment in 54EC Bonds to save capital gains on house property and the deadline for the same was 30 June, then you can now make the investment till 30 September,” said Kumar.
