Tax & Regulatory Updates: May 2019
Direct Tax Updates
In this notification, CBDT seeks to amend Form 16 (TDS certificate for salaries) and Form 24Q (quarterly TDS statement in respect of salaries). The amended forms seek more details especially about exempt allowance u/s 10. The amendments shall come into force on 12th day of May 2019.
Transfer Pricing Updates
To reduce the compliance burden of the Indian subsidiaries of US MNEs (Multinational Enterprises), on 27th March, 2019, India and USA have signed an Inter-governmental agreement for exchange of Country-by Country Reports (CbCr). This agreement for exchange of CbCr, alongwith the Bilateral Competent Authority Arrangement between the two countries will enable both the countries to automatically exchange CbCr filed by the ultimate parent entities of the MNEs in the respective jurisdictions, pertaining to the years commencing on or after 01st January, 2016. Due to this, the Indian company would not be required to do local filing of CbCr.
On 18th April, 2019, The Central Board of Direct Taxes ("CBDT") has issued a recommendatory report on attribution of profits to PEs. For this purpose, CBDT has prepared a committee inviting comments from various stakeholders which has to be provided by them within thirty days from the date of such release, after which CBDT may finalize its views on such issues which may be introduced through amendments to the provisions of the Income Tax Act, 1961 and the Income Tax Rules, 1962.
Indirect Tax Updates
In Circular No. 101/20/2019-GST, CBIC has clarified that no GST shall be levied on upfront amount payable for long term lease of 30 years or more, of industrial plots or plots for development of financial infrastructure provided by the State Government Industrial Development Corporation or undertaking or entity having 50% or more ownership of Central, State Govt.
In circular no. 98/17/2019-GST, CBIC has clarified that order of utilization of input tax credit wherein ITC available on account of IGST shall be first utilized only towards payment of IGST and if any amount remains, it may be utilized towards the payment of CGST or SGST/UTGST, in any order and in any proportion at the option of a registered person.
In this notification, CBIC has notified that all returns due for the period starting from the date of the order of cancellation of registration till the date of the order of revocation of cancellation of registration shall be furnished by the said person within a period of thirty days from the date of order of revocation of cancellation of registration.