Registration and Approval Under Income Tax Law

Income Tax

Income tax is the tax charged on the income earned by a person which is imposed by the Government of India. The amount of tax that must be paid depends on the individual’s age and the income they make. The entities also required to pay tax and file their income tax returns are Partnership firms, Limited Liability Partnerships (LLPs), Association of Persons (AOPs), Hindu Undivided Families (HUFs), Companies, Body of Individuals (BOIs) etc. The Act that covers the levy, administration, collection and recovery of Income Tax is the Income Tax Act which was enacted on 1st April 1961.

As per Income Tax Act 1961, Certain Registration and Approvals are required. Some of them are enumerated below wherein we can assist you.

  1. Permanent Account Number (PAN)

    Permanent Account Number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department. It is mandatory to quote PAN on return of income, all correspondence with any income tax authority. It is also compulsory to quote PAN in all documents pertaining to the prescribed financial transactions.

    The legal authority for allotment and use of the new series of PAN is derived from Section 139A of the Income-tax Act, 1961. This section lays down the framework for PAN, e.g., who is required to apply for PAN, who else can apply for PAN, who will allot PAN, transactions where PAN is required to be quoted, use of PAN in TDS certificates and TDS returns, that one person can have only one PAN and the manner of applying for PAN. Penalty of Rs.10,000/- is imposable u/s 272B for failure to comply with the provisions of section 139A.

  2. Tax deduction Account Number (TAN),

    Tax Deduction Account Number or Tax Collection Account Number is a 10 -digit alpha-numeric number issued by the Income-tax Department. As per Section 203A of the Income Tax Act 1961, TAN is to be obtained by all persons who are responsible for deducting tax at source (TDS) or who are required to collect tax at source (TCS).Further as per section 272BB, failure to apply for TAN or not quoting the TAN in the specified documents attracts a penalty of Rs. 10,000/-

  3. Application for Lower Deduction Certificate

    The Section 197 of Income Tax Act provides that if a taxpayer considers that his Total Income requires deduction of income tax at lower/ nil rate, he may apply to the assessing officer (AO) requesting for lower withholding certificate in Form 13.

    The AO if satisfied that existing and estimated tax liability of a applicant justifies the deduction of tax at lower rate or no deduction of tax, as the case may be, the Assessing Officer shall issue a certificate in accordance with the provisions of sub-section (1) of section 197 for deduction of tax at such lower rate or no deduction of tax.

    Certificate of Lower Deduction can be obtained if TDS is deductible under sections 192, 193, 194, 194A, 194C, 194D, 194G, 194H, 194-I, 194J, 194K, 194LA, 194LBB, 194LBC 50[, 194M] and 195.

    The CBDT, vide notification no. 8/2018 dated 31st December, 2018, has provided the procedure for electronic filing of FORM 13 online and generation of the certificate through TRACES.

    The certificate shall be valid for such period of the previous year as may be specified in the certificate.

    Our Team will assist in Obtaining Lower Deduction certificate for both Residents as well Non-Residents.

  4. Registration Under 12A And Section 80G of the Income Tax Act 1961 for Trust/NGO’s

    In order to get the Income Tax Exemption, a Trust/NGO must get itself registered with the commissioner of Income tax (exemptions) under section 12A Income Tax Act, 1961. Further if an organization has obtained certification under section 80G of Income Tax Act 1961, then donors of that Trust/NGO can claim deduction under 80G of the Income Tax Act.

    As the Finance Bill 2020 proposes to Charitable trusts and institution which are already registered u/s 12A or 12AA, 80G of Income tax Act 1961 will now be required to re-apply online for registration/approval by 31st August 2020 or such extended date. An order granting registration/approval shall be passed within 3 months of the application. Such registration/approval shall be valid for 5 years.

  5. Linking Pan with Aadhaar

    Permanent Account Number (PAN) is a unique 10-digit alphanumeric identification number issued by the Income-tax department to the taxpayers. Aadhaar is a unique 12-digit identification number with the biometrics records of the holder.

    The Finance Act, 2017 inserted a new Section 139AA to provide that every person who has been allotted a PAN shall intimate his Aadhaar number to the Income-tax Department otherwise his PAN shall become inoperative. After multiple extension of the due date to link the PAN with Aadhaar, the last due date is 30-06-2020. If PAN is not linked with Aadhaar by 30-06-2020, it shall become inoperative with effect from 01-07-2020. Beyond this date, all PAN cards not linked with Aadhaar would likely be deactivated and people using a deactivated PAN for regular transactions may be fined up to Rs. 10,000 under Section 272B of the Income Tax Act

We have the experience of obtaining various registrations and approvals from the tax department. In case you need our services, kindly contact us at [email protected] or call +91 80 26500777.