Can NRIs pay advance tax on rental revenue?
My daughter is a non-resident Indian and has a nominal rental revenue right here. Neither she nor her tenant can afford to rent a CA for tax deducted at supply (TDS) on this revenue and remit it to the revenue tax (I-T) division. Can she deposit the TDS on hire on to the division as advance tax?
—Dolly Moga
As per the provisions of part 195 of the Income Tax Act, the tenant, being the individual answerable for fee of rental revenue, is required to deduct taxes on the prescribed charges and deposit with the tax authorities on month-to-month foundation. Further, the tenant can also be required to acquire a Tax Deduction Account Number (TAN) and file the quarterly withholding tax returns in respect of such taxes so withheld and deposited.
If neither your daughter nor the tenant is able to guarantee compliance with the above provisions, the next choices could also be explored:
a. In case your daughter believes that foundation her stage of revenue (together with the rental revenue) and different components it justifies no deduction of tax from such rental revenue, then your daughter could strategy the tax authorities for acquiring a certificates of ‘Nil’ deduction of revenue tax. If and as soon as obtained, the deductor of tax (being the tenant on this case) is not going to be required to withhold taxes on the rental funds. Else, the tenant could be required to deduct taxes on the relevant price or such lowered charges, as authorized by the tax authorities. Non-compliance with these provisions could render the tenant as assessee in default and consequent curiosity and penal provisions could be relevant.
b. If your daughter recordsdata her annual ITR, provides such rental revenue to tax within the return, deposits the mandatory taxes by the use of advance / self-assessment tax and a certificates is obtained by the tenant from a CA within the specified type, then such tenant might not be thought-about as assessee in default and penalties might not be imposed, topic to analysis by the authorities. However, curiosity on non-withholding should still be payable to a specified extent.
I’ve labored within the clothes trade (a proprietorship agency) for 4 years, 7 months and seven days. The firm terminated my employment with out cause after the primary week of November. Currently, lower than 10 staff are working on the agency. How can I declare gratuity from the corporate?
—Name withheld on request
It is to be famous that the provisions of The Payment of Gratuity Act, 1972 is usually relevant to any store or institution, wherein 10 or extra individuals are employed (besides in case of manufacturing facility and institutions in specified sectors the place there is no such thing as a threshold for the variety of staff). Further, as soon as the provisions develop into relevant, the identical shall proceed to stay relevant even when the variety of staff fall under 10.
Based on the data supplied by you, it isn’t clear whether or not the provisions of the Gratuity Act, 1972, is mandatorily relevant to your organization and that is required to be additional evaluated based mostly on further particulars.
Parizad Sirwalla is associate and head, world mobility providers, tax, KPMG in India.
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