Sunday, January 11, 2009

Mandatory electronic payment of tax by certain Categories of taxpayers w.e.f. 1-4-2008

Mandatory electronic payment of tax by certain Categories of taxpayers w.e.f. 1-4-2008
CIRCULAR NO. DGBA.GAD. NO. H. 10875 / 42.01.038 /2007-08, DATED 10-4-2008

As you are aware, the Central Board of Direct Taxes vide their Notification No. 34/2008 dated 13-3-2008 (copy enclosed) have made electronic payment of taxes mandatory for the following categories of tax payers w.e.f. 1-4-2008 :
a. A company
b. A person (other than a company), to whom provisions of section 44AB are applicable.
2. In this regard the following instructions may be kept in mind while implementing the Government Notification:
(i) the status of all corporate taxpayers can be identified from the name itself. Further, the 4th digit of the PAN of all corporate assessee would necessary be “C”. Physical challans from such assessees shall not be accepted across the counter.
(ii) In case of tax payers covered under section 44AB, there should be no insistence of any proof of eligibility to pay tax through physical challans at the bank counters. The responsibility of making e- payment rests primarily with the taxpayer. Hence, the word of taxpayers should be taken as final.
(iii) the acknowledgement for e-payment should be made available immediately on screen by the bank concerned.
(iv) the transaction id of e-payment should be reflected in the bank’s statement.
(v) each bank should prominently display on its e-payment gateway page, the official /s to be contacted in case the taxpayer faces any difficulty in making the payment, completing the e-transaction, generating the counterfoil etc.
(vi) each bank should give the ITD and NSDL a list of officials with contact particulars, to be contacted if required for any problems faced by ITD or taxpayers.

EPAYMENT FROM OTHERS BANK ACCOUNT ALLOWED

Dear Friends,As I have given my opinion about the two issue earlier the same has been confirmed by the CBDT in his circular 5/2008 dated 14/07/2008.The issue were
whether a person can make e payment of taxes from others bank accounts or friends bank account?
Is tds also liable to be paid online mandatoryand I have given my opinion in earlier blog post that there is no restriction in epayment from others account and tds should also be deposited online.now lets discuss details of the circular,CBDT says
Foreign resident assessee have no access in Indian banking system due to non completion of KYC norms by bank unable to open account in authorise bank to receive e payment of taxes.
Indian Resident assessee has also facing problem to open account in such banks
Clarification has also been sought whether TDS is also covered within the meaning of "TAX" under rule 125 of income tax rules 1962 and required to be deposited mandatory by certain persons ?On these issues CBDT has clarified that
An assessee can make e payment of taxes from any other persons account .however challan must clearly indicate the pan of the person on whose behalf payment is made.
Its not necessary for the assessee to make payment of taxes from his own account in authorise bank.
Its also clarified that payment of any amount by the deductor by the way of tax deducted at source (tds) shall fall within the meaning of 'tax"for the purpose of the rule 125 of the income tax rules,1962So now both the issue has been clarified ,as both this issue are classificatory in nature hence they will be applicable from the date of applicability of original circular i.e 01.04.2008 ,so those who has made the payment from others accounts need not worry for payment already payment ,but those who has not started making tds payment online should now wake up and should start making it online with immediate effect.

epayment is mandatory for Pay TAX / TDS / TCS / FBT


No.402/92/2006-MC (05 of 2008)
Government of India / Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
***
New Delhi dated the 23rd January 2008
PRESS RELEASE
The optional scheme of electronic payment of taxes for income-tax payers was introduced in 2004. With a view to expand the scope of electronic payment of taxes, it is proposed to make the scheme mandatory for the following categories of tax-payers:-
(i) All corporate assesses;
(ii) All assesses (other than company) to whom provisions of section 44AB of the Income Tax Act are applicable.
2. The scheme of mandatory electronic payment of taxes for income-tax payers is proposed to be made applicable from 1st April, 2008.
3. Tax-payers can make electronic payment of taxes through the internet banking facility offered by the authorized banks. They will also be provided with an option to make electronic payment of taxes through internet by way of credit or debit cards.

Sources: http://www.incometaxindia.gov.in/archive/CBDTPressRelease24012008.pdf