According to an official statement released on Wednesday, the Central Board of Direct Taxes (CBDT) has loosened the rules regarding TDS/TCS in the event of the decedent’s or collector’s death, prior to the PAN and Aadhaar being linked.
“The Circular provides that there shall be no liability on the deductor/collector to deduct/collect the tax under section 206AA/206CC of the Act, as the case may be pertaining to the transactions entered into up to March 31, 2024,” an official statement read. “This is in response to the grievances of the taxpayers wherein instances have been cited, of the demise of the deductee/collectee on or before 31.05.2024 and before the option to link PAN and Aadhaar could have been exercised.”
The CBDT issued the circular on August 5, 2024, in response to the legitimate challenges that taxpayers were facing. According to the circular, the government has loosened the TDS/TCS provisions under the Income-tax Act of 1961 in the event that the deductee or collector passes away before PAN and Aadhaar are linked.
The statement claims that the Circular is a continuation of Circular No. 6 of 2024, which was previously released by the CBDT and extended the deadline for taxpayers to link their PAN and Aadhaar until May 31, 2024 (for transactions completed up until March 31, 2024), in order to avoid paying higher TDS or TCS in accordance with the Act.
Industry analysts have applauded the government’s proposal to adjust the long-term capital gains (LTCG) tax on real estate sales, stating that sellers will now have more flexibility as a result of the change.
In response to industry demands, the government on Tuesday amended Finance Bill 2024 to give taxpayers the option of choosing between a 20 percent rate with indexation or a 12.5% rate without indexation for property acquired before July 23 of this year.
According to experts, this revision may lessen the tax burden on sellers, which will encourage investment and sales in the property market.
