Income-Tax Return: Big relief for tax deductors! All taxpayers need to know about PAN-Aadhaar non-linkage
In a relief for companies, the Central Board of Direct Taxes (CBDT) has said that the tax deductors/collectors will not be treated as defaulter for failure to deduct tax at a higher rate on transactions of those deductees whose PAN became inoperative due to non-linkage with Aadhaar. The tax department’s directions are pertaining to transactions carried out between July 1, 2023 and March 31, 2024.
The CBDT, which comes under the finance ministry, said that several grievances have been received from the taxpayers that they are in receipt of notices intimating that they have committed default on ‘short-deduction/collection’ of TDS/TCS while carrying out the transactions where the PANs of the deductees were inoperative.
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In such cases, as the deduction/collection has not been made at a higher rate, demands have been raised by the department against the deductors/collectors while processing of TDS/TCS statements under Section 200A or under Section 206CB of the Act, the CBDT said in a recent circular.
“With a view to redressing the grievances faced by such deductors/collectors, the Board, in partial modification and in continuation of the Circular No. 3 of 2023, hereby specifies that for the transactions entered into upto 31.03.2024 and in cases where the PAN becomes operative (as a result of linkage with Aadhaar) on or before 31.05.2024, there shall be no liability on the deductor/collector to deduct/collect the tax under section 206AA/206CC, as the case maybe, and the deduction/collection as mandated in other provisions of Chapter XVII-B or Chapter XVII-BB of the Act, shall be applicable,” it said.
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