IT Return : Due Date extended to 15th October 2010.

The Central Board of Direct Taxes have extended the due date of filing income tax returns for the assessment year 2010-11 from 30th September 2010 up to 15th October 2010. The due date has been extended in view of disturbance to general life caused by floods.

View the Order

Extra 1% EPF interest to be taxed.

The government’s surprise gift for workers isn’t much of a gift after all. The labour ministry has hiked the employees’ provident fund, or EPF, rate to 9.5%, but a finance ministry notification says that anything in excess of 8.5% will be taxed. 

The labour ministry is, however, confident that the tax department will renotify the higher rate, as otherwise a lot of contentious issues will come up. Labour Minister Mallikarjun Kharge had declared a 9.5% bonanza on provident fund deposits on September 15 — marking a one percentage point increase in the rate from the 8.5% paid in the last five years. 

But even before the EPF board met under Kharge, the Central Board of Direct Taxes had notified a tax-free PF rate of 8.5% for 2010-11 — effective from September 1. This means that the 1% extra income (or Rs 1,700 crore) that the labour ministry has projected as a gift to the workforce, would be fully taxable. This is the first time ever that income from provident fund would be taxable, if the tax department does not notify the higher rate. 

Historically, the tax-free PF rate notified by the income tax department has never been lower than the EPF rate declared for the year. 

In recent years, while the EPF rate was at 8.50%, the ceiling was at 9.50%. This year, when the EPF rate has been hiked to 9.50%, the ceiling on tax free provident fund returns has been lowered to 8.50%. “The incremental PF return would be taxable in the hands of the worker. This has never happened before,” said Bhupendra Meel, associate vice president in charge of retirement trust solutions at AK Capital Services. 

But levying the tax would be far from easy. The PF interest would be credited to workers’ accounts at the end of the year. The trust in charge of the PF would be responsible for deducting the applicable tax at that time. 

Usually, the income tax department notifies a tax-free PF rate for the whole year. But this year, it’s only applicable from September 1. So the 9.5% provident fund return would be tax-free from April to August, but taxable thereafter. “For company-run trusts, this would be a headache — calculating the tax liability on 1% PF income for seven months,” said Amit Gopal, senior vice president at India Life Capital. 

But the most acute problem will be faced by the Employees’ Provident Fund Organisation – which manages 5 crore PF accounts. 

Firstly, EPFO simply doesn’t have the systems in place to deduct tax at source. All PF account withdrawals before completing five years of service, are fully taxable, as per existing income tax rules. But the rule has never been implemented because of EPFO’s unreliable manual record-keeping systems. 

Even if EPFO could deduct tax at source before crediting interest to members, the applicable income tax bracket would vary for its members. For every deduction made, it would also have to give workers a Form 16 statement. 

For an organization that doesn’t even give members annual account slips on time, mailing 5 crore ‘Form 16’ sheets would be physically impossible. Experts reckon the PF office could instead put the onus of paying the tax on employees filing their returns. 
Source : Economic Times

Rescheduling of Departmental Examination for ITOs/ITIs/Ministerial Staff.

The ITOs/ITIs/Ministerial Staff Examination 2010 has been rescheduled in view of elections in certain states and is now slated to commence from 26th October, 2010 and will end on 8th November 2010.


View the modified Time Table


Source : Income Tax Dept.

ITO to ACIT Promotion Order released.

DPC for DCIT to JCIT is tentatively scheduled to be at Delhi on 20/21/22-09-2010.
153 Income Tax Officers have been promoted to ACIT on 17th September 2010.


View and Download the Order

ITGOA withdraws from All India strike on 07/09/2010, ITEF to participate

Following are the versions of ITGOA and ITEF regarding the all India Strike scheduled on 7th Sep, 2010.
ITGOA Version :
"Majority Units of ITGOA have expressed their view/opinion, against participating in the All India Strike scheduled to be held on 07/09/2010, by the Confederation of Central Govt. Employees & Workers. The reason advanced by the units is none of the Gazetted Officers Association of Central Govt. Depts, are participating in the said strike on 07/09/2010. On a comprehensive consideration of the above situation, ITGOA has decided 'NOT TO JOIN THE STRIKE ON 07/09/2010'. All the Units Secretaries/President are requested to give a suitable intimation to the respective CCIT(CCA) and also inform the members, so as to remove any sort of confusion. With regards, B. Shanthi Kumar - President Rajesh Menon - Secretary General PS "


ITEF Version :
"We write this to request you once again to take all steps to mobilize the members to participate in the one day General Strike slated for tomorrow, the 7^th September, 2010.  We must continue our tradition of having cent per cent participation in the strike.  We know the decision of ITGOA to withdraw from the strike action has created difficulties, especially in some States where their leaders were with us in campaigning.  We must overcome this and if done, we can strengthen the efficacy of our organization further.  As per our report, more and more organizations of Central Government employees have decided to participate in tomorrow's strike.   The strike of 7^th September, 2010 is thus destined to be one in which the largest number of workers in the country will take part especially in the background of INTUC involving themselves in this action.

            We request you to kindly take the adverse situation brought about by the decision of ITGOA to advise their members not to participate in the strike, as a challenge and opportunity to make our Federation stronger and capable of organizing much higher form of action programmes."

Is it the begining of split in JCA ????