Income Tax Waiver Limits: The Central Board of Direct Taxes (CBDT) has said in its order that exemption in tax demand will be given to taxpayers up to Rs 1 lakh on their total outstanding tax demand. This limit of Rs 1 lakh includes the principal amount of tax demand, interest, penalty or fee, cess.
Income Tax Waiver Limits: The Central Board of Direct Taxes (CBDT) has given a big relief to the taxpayers, under which it has issued an order to give exemption on tax demand. According to CBDT, till January 31, 2024, a rebate of up to Rs 1 lakh will be given for waiving the outstanding tax demands related to Income Tax, Property Tax or Gift Tax. This relief to taxpayers was announced by Finance Minister Nirmala Sitharaman while presenting the interim budget 2024-25. Let us understand how taxpayers will be able to get tax exemption up to Rs 1 lakh?
Taxpayers will get rebate up to Rs 1 lakh
This decision of CBDT will benefit more than 1 crore taxpayers who have been sent tax demand notices up to Rs 1 lakh by the Income Tax Department. According to the announcement made in the interim budget, the Central Commission of Direct Taxes (CBDT) has started giving exemption or abolition of the old outstanding tax claim demand till January 31, 2024. According to the order issued in this regard, exemption will be given on tax demand of up to Rs 25,000 per taxpayer in every assessment year till assessment year 2010-11.
These things are included in tax demand exemption
Apart from this, exemption of Rs 10,000 will be given on tax demand every year from assessment year 2011-12 to 2015-16. In its order regarding Tax Demand exemption, CBDT has clearly said that such taxpayers will be given exemption of up to Rs 1 lakh on their total outstanding tax demand. It is important to note here that this limit of Rs 1 lakh includes the principal amount of tax demand, interest, penalty or fee, cess, surcharge. Whereas, this exemption will not be applicable on demands made against tax collectors who deduct tax under TDS or TCS provisions.
It was announced in the interim budget
Even though there was no change in the tax slab in the interim budget presented in the Parliament on February 1, Finance Minister Nirmala Sitharaman had announced exemption in the outstanding tax demand. The Finance Minister had said that this step is being taken for ease of business and life. He said that some outstanding tax demands date back to 1962, which are still on record, due to which taxpayers are worried and are also facing difficulty in getting refunds. He said that about 1 crore taxpayers will benefit from this exemption.
What is Tax Demand Notice?
Here it is very important to understand what this tax demand notice is and why it is given to the taxpayers. So, let us tell you that whatever tax declaration is made in ITR, it is checked by the Income Tax Department. If there is any discrepancy in it, then a tax demand notice is sent to the person filing the return. That is, if there is a mismatch in tax declaration, you are issued an Outstanding Tax Demand Notice. This notice is sent to you when you have any tax left to pay and the refund has to be set off against it.
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