- March 7, 2024
- Posted by: CA Sudha G. Bhushan
- Category: Income tax
Summary- The Central Board of Direct Taxes (CBDT) has observed issues regarding the timely filing of Form No. 26QE by specified persons who deducted tax under section 1945 of the Income-tax Act, 1961, from July 2022 to February 2023. Due to unavailability of Form No. 26QE, these persons faced penalties and interest under relevant tax provisions. To address these concerns, the CBDT, using its powers under section 119(2)(a) of the Act, has retrospectively extended the deadline for filing Form No. 26QE to 30th May 2023. This extension applies to cases where tax deductions were made during the specified period, and it includes waiver of fees and interest imposed up to the extended deadline.
Name-Ex-post facto extension of due date for filing Form No. 26QE which was required to be filed during the period 01.07.2022 to 28.02.2023 (pertaining to F.Y. 2022-23) – reg.
Date-7th March, 2024
Circular number- Circular 4 of 2024
Link- https://incometaxindia.gov.in/communications/circular/circular-4-2024.pdf
Brief of Provisions- Under section 1945 of the Income-tax Act, 1961, any payment made to a resident for transferring a virtual digital asset requires a deduction of 1% as income tax. Specified persons must electronically report these deductions in Form No. 26QE within thirty days from the end of the relevant month, as per sub-rule (40) of rule 31A.
During the period from July 1, 2022, to January 31, 2023, specified persons deducting tax under section 1945 of the Income-tax Act, 1961, faced challenges in filing Form No. 26QE and paying corresponding TDS due to its unavailability, resulting in penalties and interest under sections 234E and 201(1A)(ii) of the Act. Additionally, those who deducted tax from February 1, 2023, to February 28, 2023, encountered insufficient time to comply with filing requirements for Form No. 26QE and payment of TDS.
The Central Board of Direct Taxes (CBDT) has, under section 119(2)(a) of the Income-tax Act, 1961, retrospectively extended the deadline for filing Form No. 26QE to May 30, 2023, for specified persons who deducted tax under section 194S between July 1, 2022, and February 28, 2023, but were unable to file due to unavailability. Penalties and interest imposed under sections 234E and 201(1A)(ii) of the Act for this period will be waived off.
It is clarified that the above extension is a one-time exception in view of the circumstances