Income Tax Compliance Calendar for the October 2020

This article contains various Compliance requirements for the Month of October 2020 under Income Tax Laws. Compliance means “adhering to rules and regulations.” Compliance is a continuous process of following laws, policies, and regulations, rules to meet all the necessary governance requirements without any failure.

Compliance requirement under the Income Tax Act, 1961

• Important updates:

1. 5% tax will be levied on foreign fund transfer

Any amount sent abroad to buy foreign tour packages, and every other foreign remittance made above ₹7 lakh, will attract a tax-collected-at source (TCS) beginning 1 October unless tax is already deducted at source (TDS) on that amount. While the tax on foreign tour packages will be 5% for any amount, for other foreign remittances the tax will kick in only for the amount spent above ₹7 lakh.

2. New Tax Collected at Source (TCS) regime

The Income Tax Department issued guidelines for applicability of TCS provision which requires an e-commerce operator to deduct 1 per cent tax on sale of goods and services. The new Tax Collected at Source (TCS) regime will come into effect from October 1. The Finance Act, 2020 inserted a new section 194-O in the Income-tax Act 1961 which mandates that with effect from October 1, 2020, an e-commerce operator shall deduct income tax at the rate of 1 per cent of the gross amount of sale of goods or provision of service or both, facilitated through its digital or electronic facility or platform

3. Buying television sets can be expensive

Open cell panels will attract 5% import duty from 1 October, with the government saying that a duty exemption expiring at the end of this month will not be extended . As part of ‘Atmanirbhar Bharat’ the government is keen to expand domestic production capacity for open cell panels so that imports can be curbed. The one-year exemption given to the item expires today, 30 September.

4. “Transparent Taxation–Honouring the Honest”- a platform to meet the requirements of the 21st century taxation system. The platform has major reforms like Faceless Assessment, Faceless Appeal and Taxpayers Charter.
5. The Faceless Assessment Scheme, 2019 (earlier known as the E-assessment Scheme, 2019) was introduced in 2019 to impart efficiency, transparency and accountability to the assessment process by inter alia eliminating the interface between the Assessing Officer and the assessee and team-based assessment with dynamic jurisdiction. Similar Scheme will be introduced for disposal of appeals by the Commissioner (Appeals) in a faceless manner.
6. Measures taken by Government to reform Direct Tax regime

In order to provide a non-intrusive and non-adversarial tax ecosystem, the Government has taken various measures to reform the Direct Tax regime:

• Rationalisation of tax rates,
• simplification of income tax return forms,
• faster processing of refunds,
• speedy resolution of grievances and
• Introduction of faceless processes to ease the compliance burden

7. All Income Tax Return Preparation Software for AY 2020-21 are now available for e-Filing.
8. Final Opportunity – One-time relaxation for Verification of Income-tax Returns by EVC/ITR-V for Assessment Years 2015-16, 2016-17, 2017-18, 2018-19 and 2019-20 which are pending due to non-verification. Please note that the verification must be completed by 30-SEP-2020.
9. Form 35 is re-enabled to file appeal in accordance with the Faceless Appeal Scheme,’Save draft’ will be enabled shortly.

• Important Notifications: