The Covid-19 had affected a lot of families in India and has also wiped out a lot of wealth of many individuals and left many others unemployed. In order to provide a relief to the tax payers, the Income Tax Department of the country has announced certain tax benefits and reliefs for the taxpayers. In this article let’s look at some of the important announcements.
Tax Exemptions – Latest News
Anurag Thakur who is the Minister of state in the finance ministry had confirmed about the tax exemptions and the development regarding it. He conveyed that the amount paid by an employer to an employee or any other person for the treatment of Covid-19 for the year 2019-20 and the subsequent years will not be taxed.
The Finance Ministry had released a report in detail about the information. As per the reports, any amount spent by anybody for the treatment of the employee or someone else would-be tax free. In simple terms, the person who has paid for the treatment and the beneficiary who has received the payment will be exempted from tax.
Tax Exemptions for Employees
The Government has announced exemptions on the tax that is received by employees from their employer or any other person for the treatment of Covid-19. The Government has stated that many employees and individuals have received help from their employers and other well-wishers to meet the expenses of their Covid treatment.
The Press release has conveyed that in order to make sure that an individual would not have any liability on the income tax payment that arises on this account, the Government has decided to provide exemptions for the employees or the individuals or the tax payer for the amount received by their employers or well wishers for the payment of the expenses caused for the medical treatment of Covid-19 in the FY 2019-20 and the subsequent years.
Tax Exemption on Ex – gratia payment
The Government has also conveyed that there won’t be any tax on the ex – gratia payment that is received by the family member of the deceased employee due to Covid-19. The Government has conveyed that there wouldn’t be any tax charged on the amount that an individual has received as a help from the family, friends or relatives due to Covid-19. The amount exempted from the tax would be up to INR 10 lakhs.
This is considered to be one of the most important relief and a much needed one that is bought in by the Income Tax Department. The taxpayers have faced a lot of difficulties whenever they were hospitalized or under the treatment and the medical expenses for the Covid-19 had turned to be costlier for a lot of people.
The exemption for the amount received for the medical treatment would provide some relief for the taxpayers and their families as well. It is considered that the families who have lost a member would get benefited by providing exemptions on the ex – gratia amount received by them.
Deadline extended by the Government
The Government has extended the deadline for linking PAN cards and Aadhar cards to 30 September 2021 from 30 June 2021 as many people were facing troubles in linking the PAN with Aadhar cards. The deadline for making payment under the Vivad Se Vishwas Scheme has also been extended till 31 August 2021.
The deadline for the Tax Compliance for the deadline for saving Capital Gains tax has also been extended to 30 September 2021.
The move from the Income Tax Department of the country would help a lot of families and taxpayers to come out of the financial crisis they are currently facing due to the pandemic and this would provide a relief for them.
What is exemption in income tax?
Tax exemption is the monetary exclusion that reduces the taxable income which include exemption of charitable organizations from property taxes and income taxes, veterans.
Who are tax exempted for Covid-19 treatment?
The government stated that tax exemption will be presented to the amount received for medical treatment from the employer or the third party for treatment of Covid-19.
What is the limit to the tax exemption provided for Covid-19?
The exemption shall be limited to Rs 10 lakh in aggregate for the amount received from any other persons for Covid-19.