Individuals who have not filed their income tax returns for the past two years with over Rs.50,000 of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) will have to pay taxes at double rate, says the budget 2021 document.
However, TDS and TCS deducted on salary income and casual income lottery are exempted from paying higher tax rates.
“In order to discourage the practice of not filing returns by the persons in whose case substantial amount of tax has been deducted/collected, it is proposed to provide that a person in whose case TDS/TCS of Rs.50,000 or more has been made for the past two years and who has not filed return of income, the rate of TDS/TCS shall be at the double of the specified rate or 5%, whichever is higher. This provision shall not be applicable for the transactions where the full amount of tax is required to be deducted e.g. salary income, payment to non-resident, lottery, etc,” said the government in the budget.
Another proposal in the budget was to ensure that if a bank is temporarily unable to meet obligations, depositors could still claim their money to the extent of up to Rs.5 lakh. Last year, the government increased the deposit insurance cover from Rs.1 lakh to Rs.5 lakh.
