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Happy New Year 2020: Tax Resolutions before Financial Year Ends

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Every day is a new beginning. Instead of focusing on the failures of yesteryears, let’s learn from those experiences and start today with positive thoughts and expectations. It’s a new year and it’s time to make a difference!

The first day of the year is the perfect time to set priorities of your financial planning and setting goals for the months to come. We are listing out 5 New Year’s resolution you should make to make to end Financial Year 2019-20 on a high note. After all, three months are still left for the financial year and as they say, all is well that ends well.

  • File your Income Tax Return

31-03-2020 is the last date for filing of belated Income-tax return for the Financial Year 2018-19. There are adverse consequences in case of failure to file the Income-tax return which forfeiture of unclaimed losses, best judgment assessment, non-payment of the tax refund, the penalty for concealment of income and prosecution.

  • Invest rather than paying tax

First-quarter of 2020 is the last quarter for the financial year 2019-20. If you are a new taxpayer and you are in a dilemma as to how to save tax. Here is an advice for you. Make certain investment like, life insurance, health insurance, housing loan, etc. to save tax as these investments provide tax deductions. We suggest making your tax planning timely to avoid last-minute rush.

  • Submission of investment proof to the employer

In the last quarter of the financial year, employers ask for submission of evidence of investments from the employees. The tax deducted at source (TDS) by the employer is based on the proofs submitted by the employee. Hence, it is important for the salaried class to give the details of Investments and deductions to the employer so that the correct tax is deducted.

  • Pay the last instalment of advance taxes

Advance tax is ‘Pay as you Earn Scheme’.  The taxpayer is liable to pay advance tax if his estimated tax liability of the financial year is Rs. 10,000 or more. Every taxpayer irrespective of his residential status is liable to pay advance tax if the advance tax payable during the financial year is Rs. 10,000 or more. The advance tax has to be paid in 4 instalments during the year:

Due date for payment of advance tax Advance tax payable
   
On or before 15th June        15%
On or before 15th September 45%
On or before 15th December          75%
On or before 15th March 100%

An assessee opting for presumptive taxation scheme of Section 44AD or Section 44ADA can pay 100% of the advance tax in a single instalment up to 15th March. If the assessee fails to pay the advance tax, he is liable to pay the interest under section 234B and 234C.

Refer Tax Rates for Financial Year 2019-20 to compute your tax liability for Financial Year 2019-20.

  • Linkage of Aadhaar with PAN

The Central Board of Direct Taxes (CBDT) has extended the due date for linking of the permanent account number (PAN) with Aadhaar from 31-12-2019 to 31-03-2020. If your PAN is not linked with Aadhaar by the deadline, then your PAN will become inoperative. If a person’s PAN becomes inoperative, it will be treated as if the individual is not holding the PAN. Hence, we suggest linking the PAN-Aadhaar as soon as possible

May the New Year bring you happiness, peace, and prosperity! Wishing you a joyous 2020!

Admin

Tax Dept. turned ‘Santa’ for the taxpayer

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