5 Money and tax tasks you should complete by July 31, 2020
In the wake of novel coronavirus pandemic, the government has provided various relaxations in meeting the financial deadlines to the common man. Many of these deadlines are expiring on July 31, 2020. Here is the list of five of those financial deadlines.
Since March 2020, the government has extended various tax-related deadlines and relaxed terms and conditions of certain post office investment schemes. This was done to help the common man tide over financial problems caused due to the coronavirus pandemic.
Many of these extended deadlines end on July 31, 2020.
Here is a look at five money-related tasks you should complete by July 31.
- Last date of paying self-assessment tax for FY 2019-20
If your self-assessment tax for FY 2019-20 exceeds Rs 1 lakh, then you should pay it before July 31, 2020 to avoid levy of penal interest. As per a CBDT press release dated June 24, 2020, individuals whose self-assessment tax liability exceeds Rs 1 lakh, the last day to pay self-assessment tax without any penal interest is July 31, 2020. If such tax is paid after the date, then penal interest at the rate of 1 per cent per month will be levied.
- End of reduced EPF contributions
To provide relief to employers and to provide higher take home pay to employees, the government reduced the Employee's Provident Fund (EPF) contribution for three months (for May, June and July, 2020). Therefore, from next month when your employer pays you salary, the deduction for your contribution to your EPF will be made at the normal rate of 12 per cent instead of the reduced 10 per cent. Employer's contribution to EPF will be made at the normal rate of 12 per cent instead of the reduced 10 per cent. Employer's contribution to EPF will also have to be restored to the earlier 12% wherever the employer had opted to reduce the contribution.
Those employees who opted for Voluntary Provident Fund (VPF) to reduce the impact of the lower EPF contributions, need to keep one thing in mind. If you have opted for VPF, then the VPF deduction as well as the restored higher EPF deduction will be made from your salary from next month onwards unless you stop your VPF contributions. If VPF contributions are not stopped the restoration of the EPF deduction to the previous higher level will reduce your take-home pay vis-à-vis salary received by you in the month of April, 2020.
- Filing of belated ITR for FY 2018-19 extended to September 30, 2020
The government via a notification dated July 29, 2020 has extended the deadline to file belated income tax return (ITR) for FY 2018-19 from July 31, 2020 to September 30, 2020. This is the third time that the deadline has been extended - First, from the original deadline of March 31, 2020 to June 30, 2020 and then to July 31, 2020 and now to September 30, 2020.
If an individual does does not file the belated ITR, if due, by the deadline, then he/she will not be able to file the income tax return for the financial year 2018-19.
Abhishek Soni, founder & CEO, Tax2Win.in, an ITR filing website says, "As per the notification issued by Central Board of Direct Taxes (CBDT) on 29th July, 2020, the due date of filing the belated and revised ITR of F.Y. 2018-19 (A.Y. 2019-20) is further extended from 31st July, 2020 to 30th September, 2020. Therefore, both belated or revised ITR of F.Y.2018-19 (A.Y. 2019-20) can be filled till 30th September, 2020."
- Filing revised ITR for FY 2018-19 to September 30, 2020
The last date to file a revised ITR for FY2018-19 has also extended to September 30, 2020 from July 31, 2020. If the revised return is not filed by this extended deadline, then an individual taxpayer will lose the opportunity to file revised ITR for FY 2018-19.
A revised ITR is filed to correct mistakes made, if any, in the original tax return filed.
- Last date for making tax-saving investments for FY 2019-20
If you still have not completed you tax-saving exercise for FY2019-20, then you have time till July 31, 2020 to do so. The deadline to make tax-saving investments for FY 2019-20 was extended to July 31, 2020 from the original deadline of March 31, 2020. If you miss this deadline, you will not be able to reduce your tax liability for the financial year 2019-20 via tax saving investments/expenditure.
- Deadline extensions for small savings scheme accounts
The government had relaxed rules of various small savings schemes giving more time for various compliances; These will end on July 31. These are some of the relaxations available to investors of small saving schemes.
- Post office recurring deposit (RD) account holders can deposit the instalments for the months of March, April, May and June, 2020 in their RD account till July 31, 2020 without paying revival fee or default fee.
- With regards to the Sukanya Samriddhi Yojana scheme, if a girl child has attained the age of 10 years during the period between March 25, 2020 and June 30, 2020, i.e., the lockdown period, then the scheme account for such a girl child can be opened till July 31, 2020.
- Last date to file TDS/TCS statement
The government via a press release dated June 24, 2020 announced that the last date to file TDS and TCS statement has been extended to July 31, 2020. As per the announcement, "The furnishing of the TDS/ TCS statements and issuance of TDS/ TCS certificates are the prerequisite for enabling the taxpayers to prepare their return of income for FY 2019-20, the date for furnishing of TDS/ TCS statement and issuance of TDS/ TCS certificate pertaining to the FY 2019-20 has been extended only to 31st July, 2020 and 15th August, 2020 respectively."
As per chartered accountants, the government has extended the original deadline of May 31 to June 30, 2020 via an ordinance dated March 31, 2020. Remember that individuals too are liable to deduct TDS and provide TDS certificates in case of certain specified payments. These specified payments include: payment made on buying a house of more than Rs 50 lakh or TDS on house rent if monthly rental exceeds Rs 50,000 and more.