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Online Personal Finance Magazine
No beating about the bush.
The Indian government on Tuesday extended the deadline till 30 June 2020, for filing income tax returns (ITR) for financial year 2018-19 in a bid to provide relief amid the coronavirus (COVID19) crisis. The last date for filing goods and services tax (GST) for March, April and May 2020 is also extended till June end. While waiving the fee on minimum balance, bank customers are allowed to withdraw money from any bank's automated teller machine (ATM) over next three months.
Addressing the media through video conferencing, finance minister Nirmala Sitharaman also said that the government has reduced the interest rate on delayed deposit of tax deduction at source (TDS) to 9% from 18%.
She says, "For delayed payments of advanced tax, self-assessment tax, regular tax, TDS, tax collected at source (TCS), equalization levy, securities transaction tax (STT), commodities transaction tax (CTT) made between 20th March and 30 June 2020, reduced interest rate at 9% instead of 12 % or 18 % per annum, or 0.75% per month instead of 1% to 1.5% per month will be charged for this period. No late fee or penalty shall be charged for delay relating to this period."
Providing a relief to bank customers, the FM says, debit card holders who withdraw cash from any bank's ATM can do it free of charge for the next three months. Waiver of the minimum balance fee charged by banks is waived while bank charges for digital trade transactions for all trade finance consumers are being reduced, Ms Sitharaman says.
The government has also extended the deadline for linking of Aadhaar and permanent account number (PAN) till 30th June 30.
On GST, the minister says, "Last date for filing GSTR-3B in March, April and May 2020 will be extended till the last week of 30 June 2020 for those having aggregate annual turnover of less than Rs5 crore. No interest, late fee and penalty will be charged."
The mandatory requirement of holding meetings of the company board within prescribed interval of 120 days as provided in the Companies Act 2013, is being extended by 60 days till next two quarters or till 30th September, the finance minister says.
To ease burden on companies and auditors, Ms Sitharaman says, the applicability of Companies (Auditor's Report) Order, 2020 would be made applicable from financial year 2020-2021 instead of from 2019-2020 notified earlier.
Due to the emerging financial distress faced by most companies due to large-scale economic distress caused by COVID 19, the government has decided to raise the threshold of default under section 4 of the Insolvency and Bankruptcy Code (IBC) 2016 to Rs1 crore from the existing threshold of Rs1 lakh.
"This will by and large prevent triggering of insolvency proceedings against micro, small and medium enterprises (MSMEs). If the current situation continues beyond 30 April 2020, we may consider suspending section 7, 9 and 10 of the IBC 2016 for six months so as to stop companies at large from being forced into insolvency proceedings in such force majeure causes of default," the finance minister added.
The government has also provided big relief to the corporate sectors on compliance related issues particularly related to incorporation of businesses and qualifications of directors.
As per announcements made by the finance minister, a company has now been given six more months to file declaration of commencement of business. At present such declaration has to be made within six months from in corporation.
Directors of Indian registered companies have also been freedom from compliant with residency rules that mandates them to be in India for a minimum period of 182 days.
"Under Section 149 of the Companies Act., non compliance of this rule was treated as a violation. Now, it shall not be treated as a violation," the finance minister said.
The government has also decided to give more flexibility to companies over the n eed to create a deposit reserve from 20% of the deposits maturing in FY2021 by 30 April this year. This requirement can now be met by 30 June 2020.
Also, companies have been given time till June end to invest 15% debentures maturing during a year in specified instruments. The date of compl iance for this earlier was 30th April.
The relief comes amidst the whole of the country coming to a standstill amid the rising number of coronavirus cases and lockdown across states.