Central Board of Direct Taxes (CBDT) chairman Nitin Gupta said in an interview that the income tax department is keeping a close eye on tax evasion in the gaming industry. To avoid any action, winners of online games must disclose their income and pay applicable taxes along with filing an updated Income Tax Return (ITR-U). Generally the last date for filing ITR-U is 24 months after the end of the relevant assessment year. The last date for filing ITR-U for the financial year 2021-22 is 31 March 2024. He said that the winners of games on various gaming portals have to file ITR-U. It also provides for payment of tax forward to avoid penalty.
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Clarification on new TDS provisions soon
CBDT will soon issue a clarification on the process of implementation of new TDS provisions to various stakeholders especially banks. These provisions relate to profits or preconditions derived from any business or profession. Gupta said the board will issue an official circular in this regard. This includes issues such as One-Time Settlement (OTS) faced by banks
The rule is that those who earn through social media have to pay income tax
ITR-U is beneficial for them
- One lakh ITR-Us have been filed since the presentation of Budget 2022. So the tax collected is Tk 28 crore.
- It is beneficial for those who knowingly or unknowingly do not pay tax on money earned from gaming, betting, lottery.
- 58,000 crore distributed by gaming portals
- A gaming portal won Rs 58,000 crore in a span of three years. They have more than 8 million users.
Do ‘these’ important tasks before 31st August, otherwise you will get a blunder
ITR-U provides an opportunity to update income tax returns within two years after the end of the relevant assessment year. ITR-U provides taxpayers with an opportunity to include any income they have forgotten to pay tax while filing their income tax return. It is important to note that additional income is subject to an additional tax of 25% to 50%. Taxpayers filing updated returns are also required to state the reasons for updating income. Reasons may include – previously unfiled return or income statement not reported correctly, wrong income picked or reduction of loss carried forward.
Also, before ITR-U, once the original ITR was filed, an individual had the option of filing an amended income tax return to correct the mistakes made while filing the return. Last date for filing revised ITR is 31st December of the assessment year. Once this deadline is missed, the taxpayer cannot correct the mistakes made while filing the ITR.
Currently ITR-U can be filed for financial years 2019-20 and 2020-21 or assessment year 2020-21 or 2021-22.