Budget 2020 has introduced a new section 115BAC income tax law Along with Automated Income Tax Preparation Software All in One in Excel for the F.Y.2021-22

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Budget 2020 has introduced a new section 115BAC income tax law, where an individual has the option to choose between the old tax rate and the new tax-deductible rate regardless of the prescribed deduction or deduction.

Budget 2020 has introduced a nes section 115 BAC

Therefore, To address such questions, the Central Board of Direct Taxes (CBDT) has issued a clarification through Circular No. C1 of 2020 stating that an employer, based on the information received from an individual employee, considers the source tax deduction (TDS) calculation. Should be. The provisions of section 115BAC, as applicable.

Section 115BAC of the Income-tax Act

The new section 115BAC of the Income-tax Act, 1961 provides that an individual, an individual or an undivided Hindu family (HUF) who has income other than income from occupation or business, may exercise the option of levying a tax of the previous year. In other words, The return of his / her income under section 115 BAC should be submitted for each year under section 139 (1) of the Income-tax Act.

The acknowledgement rate given under section 115 BAC is subject to the condition that the total income needs to be calculated without specific deductions or deductions, set-off losses, and additional depreciation.

Key points of CBDT clarification in Section 115BAC

 However, The key points of the clarification issued by CBDT are as follows:

If the taxpayer is an employee and has income other than income from his company. He wants to get a rebate rate under section 115 BAC which should be notified to the detector every previous year.

For instance, If the employee fails to provide the information, the employer will have to do TDS without considering the provisions of section 115 BAC.

Budget 2020 has intduced a new section 115 BAC

A new optional tax system

Similarly, Under the Finance Act, 2020, a new optional tax system has been provided for individuals and HUFs, including modified tax slabs and rates. Satisfied with the stipulated condition, an individual or HUF may choose to calculate tax on total income without considering the prescribed deduction or deduction when filing his income tax return according to the new slab rate, instead of the existing tax system.

Learn more about the new Section 115 BAC person and the tax rate applicable to HUF

Tax evasion from salary

It is noteworthy that every employer responsible for paying salaries is required to withhold tax on such salaries paid to their employees based on the rate at which the F.Y was paid. Above all, The rate of deduction of income tax from the income assessed under the heading of ‘salary’ is the actual tax rate. In this regard, there is a lack of clarity on whether an employer can consider a new tax system when tax withholding.

Information on the choice of a new tax system by an employee

In addition, the CBDT has made it clear that an income taxpayer must inform his employer of his intention to choose a new tax system at a discounted rate without considering the prescribed deduction or deduction. Such information, once generated by an employee, cannot be changed in the relevant financial year. As a result, the employer has to calculate the total income and deduct TDS as per the new tax system.

After that, If the employee does not provide any information to the employer, the employer will have to calculate the full income and deduct the TDS according to the old tax system.

Above all, Informing the employer would not be tantamount to using the option under section 115BAC (5) of the Act. Thus, the option to file a return within that period may differ from the information provided by the employee to his employer for that particular financial year.

Section 115 BAC for taxpayers with business income

Furthermore, in the case of a taxpayer’s business income, the once used option will be applicable for all subsequent financial years and such taxpayers must notify the employer, as applicable. The information provided once cannot be changed for the next financial year except in the prescribed circumstances.

In conclusion,

The clarification issued by the CBDT clarifies the ambiguity regarding the role of the employer in calculating the TDS on salary.

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Salary Structure

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9) Automated Income Tax Revised Form 16 Part B for the F.Y.2021-22

10) Automatic Convert the amount into the in-words without any Excel Formula

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