Page 16 - Seniors Today - February Issue
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Now, if a business has sales turnover of more
than Rs. 10 crore in a year and buys goods
of more than Rs. 50 lakh from a particular
supplier, then the excess over Rs. 50 lakh will
be subject to TDS at 0.1%, under sec. 194Q.
PARTNERSHIP FIRM Sec.45(4) of the
Income-tax Act already provides for taxation
in the hands of a firm when there is a
dissolution or reconstitution of a firm and if a
Capital Asset has been given to the partner.
Now some changes are proposed in sec.45(4) There was a need for relief to the tourism sector, as hotels
and a new sub-sec.4A is being introduced to and restaurants have taken a big hit due to Covid, but this
provide that not only a Capital Asset but even did not happen
if money or other assets are handed over to the instalments of June 15 and September 15.
a partner on dissolution or reconstitution, This is a provision which is helpful to
this can be taxable in the hands of the firm. assessees.
One must therefore be careful and take REOPENING Certain changes are proposed
proper advice before effecting a dissolution or in the matter of reopening of assessments.
reconstitution of a partnership firm. Now there will be 3 periods within which
ADVANCE TAX There is a benefit proposed reopening can be carried out, in various
here. Under sec. 234C of the Act, interest is circumstances.
payable on shortfall in payment of Advance- (a) In some cases, reopening can be done
tax. The instalments of Advance-tax are to be only within 3 years of the end of the Asst.
paid by June 15, September 15, December 15 Year;
and March 15 of every financial year and one (b) If the income or asset which has escaped
would have to predict one’s income in order to assessment is more than Rs. 50 lakh, then
be able to pay Advance-tax properly. reopening can be done within 6 years from
Dividend from other companies is not the end of the Asst. Year;
predictable and therefore if a person were to (c) If any income from foreign sources is
receive dividend at the end of the year and deemed to have been concealed the reopening
had not paid Advance-tax on that dividend can be within 16 years from the end of the
in the earlier instalments, one would be liable Asst. Year.
for Interest under Sec. 234C. An important change being made is that
Now the law is to be amended to say that an assessment can be reopened only if there
dividend will be subject to Advance-tax only is evidence and not merely on the basis of
after it is received and need not be taken into suspicion.
account in the earlier instalments. Time limit for Completing assessments.
If, therefore, a company declares a dividend Assessments now will have to be completed
on say October 20, then the advance-tax with within 9 months from the end of the Asst.
reference to that amount of dividend will have Year. So, for F.Y.2020-2021 relating to Asst.
to be paid only in instalments by December Year 2021-21, the assessment will have to be
15 and March 15, and the dividend will not be completed by 31st Deemb4er 2022.
taken into account or treated as shortfall for This shorter period is good because matters
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