In view of the hardships due to the second Covid-19 wave, the government has extended key compliance timelines for income tax and goods and services tax and waived late fees. The ministry of finance had received multiple industry representations, including from micro, small and medium enterprises, wanting a breather of up to three months. With Covid cases rising in the country, experts feel that the government will need to extend the timelines further.
Relief measures include time extensions for filing belated or revised Income Tax Returns for FY 2019-20, GSTR-1 (sales return), GSTR 3B (summary return), GSTR -4 (annual composition return), filing of any appeal, payment of taxes, rationalization of rate of interest, waiver of late fees.
"In view of the adverse circumstances arising due to the severe COVID-19 pandemic and also in view of the several requests received from taxpayers, tax consultants & other stakeholders from across the country, requesting that various compliance dates may be relaxed, the Government has extended certain timelines today," central board of direct taxes ( CBDT)said in a statement.
Under the relief measures, the government has waived late fees for filing summary return or GSTR 3B for March and April for taxpayers with turnover of up to Rs 5 crore and over Rs 5 crore for a delay of up to 30 days and 15 days respectively. The due date for filing annual return by compensation dealers has been extended to May 31 from April 30. Due date for GSTR 1 or sales return has been extended by a month to May 26.
Several parts of the country including Delhi, Mumbai, cities in Haryana and Uttar Pradesh are facing a lockdown. Tax experts pointed out that small and medium enterprises were the most hit if compliance timelines were not extended.
Interest rate has been halved to 9 per cent for a delay of 15 days for GST assesses with turnover of over Rs 5 crore. Interest rate has been waived for GST asseses with a turnover of up to Rs 5 crore for first 15 days and 9 per cent for the next 15 days.
As for income tax, the government has extended the date for filing of belated return under and revised return under Assessment Year 2020-21 till May 31, 2021 from March 31.
Income-tax return in response to notice under Section 148 of the Act has been extended to May 31 from April 1.
Also, the due date for filing objections to Dispute Resolution Panel (DRP) and filing appeals to the commissioner has been extended till May 31.
Nangia & Co LLP Partner Shailesh Kumar said while the government has provided much-needed relief to taxpayers on the compliance front, if the Covid-19 situation does not improve in the next two weeks, it may need to extend these timelines further, considering that a large number of families are suffering from Covid currently.
Abhishek Jain, Tax Partner, EY said, "With the unprecedented surge in Covid-19 pandemic and lockdown in several parts of the country, many industry players would have struggled to meet the Gst compliance deadlines. The extension in the deadlines would provide the much needed relief to the industry"
Sachin Taparia, chairman and founder LocalCirlcles, said that the government may have to provide further extension till June 30 if lockdowns and restrictions persist past May 24 in different parts of India, preventing small businesses from filing. “
“Though there was a good bit of back and forth this time and a lot of time was taken, we are glad at the end the Government made the right decision which will provide the much needed relief to small businesses”, Taparia added.
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