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Income Tax Dept. facilitates new functionality for banks and post offices

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The Income Tax Department has facilitated a new functionality for Banks and Post offices through which they can ascertain the TDS applicability rates on cash withdrawals.

Under it, the Banks and Post Offices can ascertain the TDS applicability rates on cash withdrawals of above Rs 20 lakh in case of a non-filer of the income-tax return and that of above Rs one crore in case of a filer of the income-tax return.

The Central Board of Direct Taxes, CBDT in a statement said, so far, more than 53,000 verification requests have been executed successfully on this facility.

Explaining the details of this facility, CBDT said that now the Bank and Post Office has to only enter the PAN of the person who is withdrawing cash for ascertaining the applicable rate of TDS. On entering PAN, a message will be instantly displayed on the departmental utility.

It said, TDS is deductible at the rate of 2 per cent if cash withdrawal exceeds Rs one crore, if the person withdrawing cash is a filer of the income-tax return. It said, TDS is deductible at the rate of 2 per cent if cash withdrawal exceeds Rs 20 lakh and at the rate of 5 per cent if it exceeds Rs one crore in case the person is a non-filer of the income-tax return.

CBDT said that the data on cash withdrawal indicated that a huge amount of cash is being withdrawn by the persons who have never filed income-tax returns.

To ensure filing of return by these persons and to keep track on cash withdrawals by the non-filers, and to curb black money, the Finance Act, 2020 further amended Income-tax Act from 1st of this month to lower threshold of cash withdrawal to Rs 20 lakh for the applicability of this TDS for the non-filers.

It also mandated TDS at the higher rate of 5 per cent on cash withdrawal exceeding Rs one crore by the non-filers. (AIR)

31 Days ago
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