In a move that will bring down one of the most common tax disputes, the income tax (I-T) department has clarified that the taxpayer can decide how to classify the gains from sale of shares—as capital gains or as business income. In a notification dated 29 February, the tax department said the determination whether a particular investment in shares or other securities is in the nature of a capital asset or stock-in-trade has led to a lot of uncertainty and litigation in the past, compounded by different interpretations of the law by courts. Therefore, the tax department has decided to take the interpretation away from the assessing officer’s hands and leave it to the taxpayer to make the classification. This means that a taxpayer dealing in equities can decide if it is an investment or his business. However, a classification once made in an assessment year cannot be changed in subsequent years. “Where the assessee itself, irrespective of the period of holding the listed shares a
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www.caonline.in News... 1.Request to join with family for Spritual and Cultural Programme organised by Art of Living, Near Mayur Vihar Extension Metro Station, Delhi from 11-13 March from 5PM onwards. Chief Guest Prime Minister and President of India. Entry Free. 2.Jurisdiction of AO in search cases cannot be challenged after one month of notice.This amendment will take effect from 1st June, 2016 3.Digital Signature is now mandatory w.e.f. 4th Quarter of FY 2015-2016 for dealers having turnover above Rs. 50 lakhs. It means all the returns and other correspondences should be filed with D-VAT department via digital signature only. 4.Power of CG to impose transitional product specific safeguard duty on imports from the People’s Republic of China, to omit section 8C of the Customs Tariff Act as the provision which was inserted for a period of ten years has lapsed. Clause 137, Omission of section 8C - THE FINANCE BILL, 2016 5.Extension to 31.03.16 of last date to file DP-1 under DVAT
If there's a dispute over taxes, there's now a way for a company to prevent its property being attached. It can give a bank guarantee to the tax officer to prevent property, such as a factory, from being attached during the course of a tax assessment. The Budget proposals provide that a tax official can revoke an order for provisional attachment of the property if the taxpayer furnishes a bank guarantee equal to the fair market value of the property, or of an amount sufficient to protect the interests of the revenue authorities. Within 15 days of receipt of the bank guarantee, or within 45 days if the case has been referred to a valuation officer, the order for attaching the property is to be revoked. This proposal will come in force from June 1, 2016. Business entities operating in India, often find that their property, such as an office or a factory building, is attached by the tax authorities during the course of assessment. For instance, operations froze at Nokia's man
Govt Expands The Net By Plugging LoopholeNon-Compliance To Attract Stiff Penalties Professionals obtaining any sum of money under a non-compete agreement will now be subject to tax with the government having plugged a loophole in the Budget. Once non-compete agreements were largely restricted to the manufacturing arena.For instance, an outgoing employee would have to sign on the dotted line that he would not share knowhow or a patent that he had helped develop during his employment. Or if he was an inventor, he could be debarred under the non-compete agreement from starting a similar line of business for a certain period. The money received under such non-compete agreements was duly taxed. “There was no specific provisions to cover professionals who could argue that the sum of money received by hem under a non-compete agreement was not taxable,“ says Gautam Nayak, tax part ner, CNK & Associates. Now a wide gamut of pro essionals -such as those in he legal, medical, enginee ring or
The Budget has introduced a special `royalty tax' which lowers the effective rate of tax on income earned from patents. The objective is to encourage indigenous research and development, and to make India an innovation hub. The benefit will be available across knowledge-based sectors of the economy , including pharmaceuticals. The FM proposed a special patent regime with a 10% rate of tax on income from worldwide commercialization of patents which are developed and registered in India. Usually, the domestic company which has commercialized the patent would be paying tax from income at the standard rate of 30% after deducting expense. With this proposal, the tax liability on income from commercialization of patents goes down, and thus would be beneficial for knowledge-based firms, experts say , adding that it would reduce the outflow of intellectual property from India. The aim of the `concessional taxation regime' extended across sectors, for income derived from patents, is to
Govt Expands The Net By Plugging Loophole Non-Compliance To Attract Stiff Penalties Professionals obtaining any sum of money under a non-compete agreement will now be subject to tax with the government having plugged a loophole in the Budget. Once non-compete agreements were largely restricted to the manufacturing arena.For instance, an outgoing employee would have to sign on the dotted line that he would not share knowhow or a patent that he had helped develop during his employment. Or if he was an inventor, he could be debarred under the non-compete agreement from starting a similar line of business for a certain period. The money received under such non-compete agreements was duly taxed. “There was no specific provisions to cover professionals who could argue that the sum of money received by hem under a non-compete agreement was not taxable,“ says Gautam Nayak, tax part ner, CNK & Associates. Now a wide gamut of pro essionals -such as those in he legal, medical, enginee ring