In order to provide relief to the taxpayers facing the hardship due to covid 19, the government has announced certain tax benefits and compliance reliefs for the taxpayers. Here are some of the important announcements that you should know about.
1) No tax on the amount received by employees from employers or any other person for covid treatment. “Many taxpayers have received financial help from their employers and well-wishers for meeting their expenses incurred for treatment of Covid-19. In order to ensure that no income tax liability arises on this account, it has been decided to provide income-tax exemption to the amount received by a taxpayer for medical treatment from employer or from any person for treatment of Covid-19 during FY 2019-20 and subsequent years” said the press release.
2) No tax on ex-gratia payment received by the family member of the deceased employee due to covid. There will also be no tax on financial help received from relatives and friends till the aggregate amount is ₹10 lakh. “This is a welcome and much needed relief brought in by the CBDT. The taxpayers genuinely faced several difficulties whenever they were hospitalised or otherwise subject to rigorous medication. COVID treatment has also turned out to be costly for quite a lot of people. The exemption for amount received for medical treatment will provide some respite and we hope that many taxpayers would get benefitted by this. The exemption of ex-gratia amount received on death is also a good step and will provide some respite to the effected families,” said Amit Maheshwari, Tax Partner, AKM Global, a tax and consulting firm.
3) The government has extended the deadline for PAN and Aadhaar linking to 30 September from 30 June. “Many people were facing glitches while linking their PAN with Aadhaar at the new Income-tax e-filing portal, therefore, the government has now further extended this date to 30th September 2021 from 30th June, 2021,” said Tarun Kumar, a Delhi-based chartered accountant.
4) The deadline for making payment (without additional amount) under Vivad Se Vishwas scheme has been extended till 31 August while the last payment date with additional amount has been extended till 31 October. “The extension of various due dates, be it for PAN-Aadhaar linking, for payment of tax/ penalty under Vivaad-se-Vishwas scheme, completion of assessment proceedings, completion of penalty proceedings, registration of charitable trusts and institutions for income tax exemption, etc. will provide additional time, both to taxpayers as well as tax authorities for meeting the timeline,” said Shailesh Kumar, Partner, Nangia & Co LLP.
5) Tax compliance deadline for saving capital gains tax extended. So tax compliance deadline falling between 1 April, 2021, and 29 September 2021, for making investment, deposit, payment, acquisition, purchase, construction or such other action to save tax under provisions contained in Section 54 to 54GB of the Income Tax Act, has been extended till 30 September 2021. “So, suppose if you were required to make a investment in 54EC bonds to save capital gains on house property and the deadline for the same was 30 June, then you can now make the investment till 30 September,” said Kumar.
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