With the aim of Atamnirbhar Bharat, Finance Minister Nirmala Sitharaman made an important announcement of the Union Budget of 2021-2022 on February 1st 2021. This budget included many reforms in multiple ways. One of the important reforms is about Dispute resolution. In this article, we will read about the Dispute Resolution Committee to have multiple benches- Budget 2021.
Setting up Multiple Benches exclusively for Taxpayers
There is a piece of Good news from the Dispute Resolution Committee for small taxpayers. The committee has decided to set up multiple benches, helping small taxpayers settle matters without going into a rigorous appellate process.
Also, It has a constant endeavour to ensure taxpayers are motivated to abide by tax laws and take care of people who are taking advantage in an unfair and undue manner of the system.
Finance Minister Nirmala Sitharaman, in her 2021-22 Budget speech, said a Dispute Resolution Committee (DRC) would be set up, which will cater to small taxpayers. Those small taxpayers having taxable income up to Rs 50 lakh and income up to Rs 10 lakh can easily approach the committee to resolve their disputes.
Government Officials also mentioned the further strengthened by exchanging information with other agencies. Agencies sharing information are the Securities and Exchange Board of India (SEBI), Ministry of Corporate Affairs (MCA), and Central Board of Indirect Taxes (CBIC) to help taxpayers file correct tax returns.
Important Update regarding PF and FD
Further, the Joint Secretary stated that the new provision of taxing interest on deposits in the provident fund exceeding Rs 2.5 lakh per year, promised that there has no dual taxation. It will function the same way as today’s taxation of interest income on fixed deposits in banks.
To explain this, the officials also demonstrated an example that banks deduct 10 per cent tax on the interest earned on a fixed deposit. If the taxpayer’s tax slab is higher than 10 per cent, an individual must pay the advance tax. But if the tax liability is less than 10 per cent, taxpayers will receive refunds.
Further added that this method would be entirely the same for provident funds too. Whatever investment you make to the provident fund exceeding Rs 2.5 lakh will be taxable from April 1, 2021. However, it will operate in the same way as today’s taxation of interest income on fixed deposits.
“This positive initiative by the government seems a good step towards helping small taxpayers. Everyone hopes it will help them to resolve their disputes quickly and easily.”
Moreover, If you want any other guidance related to ITR Filing, please feel free to talk to our business advisors at 8881-069-069.
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