Income tax return: Non-ITR filers will face higher TDS

If you do not file an income tax return for the fiscal year 2020-21, you will be on the list of non-tax filers and will face higher tax deductions at source from this financial fear. The Central Board of Direct Taxes (CBDT) has issued a circular to designate non-filers or “designated persons” who, subject to higher tax retention or collection for FY 2022-23, relax some guidelines.

According to the notification, if the ITR is not filed for the relevant previous financial year and the total TDS and tax collected at source in that year is more than Rs 50,000, it will attract a higher TDS. Banks need to check whether a person has met both the conditions to attract higher TDS.

During FY23, no new names were added to the list of individuals to reduce the burden on tax collectors and collectors, it said. If a certain person files a valid return (file and verified) of income for the assessment year 2021-22 FY23, his name will be removed from the list of certain persons. This will be done on the date of submission of valid return of income.

Also, the provisions of section 206AB will not apply to the deduction of tax on transfer of Virtual Digital Assets (VDA) under section 1948 of the Act to an individual or a taxpayer as a Hindu undivided family. This applies if the sales, total receipts or turnover is not more than Rs. 1 crore in case of business or Rs. Income.

The notification said that under the provisions of Sections 206AB and 206CCA, certain persons shall not include a non-resident who does not have a permanent establishment in India.