Covid relief: No income tax on financial aid for treatment; exemption to ex-gratia received by kin of deceased

It additionally prolonged the due date of assorted compliances, together with the final date of linkage of Aadhaar with PAN from June 30 to September 30, 2021, in addition to final date for fee underneath Vivad se Vishwas by 2-4 months.

Given the extreme influence of the second wave of the Covid pandemic on the economic system, the Union authorities on Friday introduced earnings tax exemptions to monetary aids obtained by individuals for Covid therapy. It additionally gave tax exemption to ex-gratia obtained by the kin of the deceased – if the succour is obtained from employers, the exemption is obtainable with none higher restrict and if obtained from others, the waiver shall be out there for as much as Rs 10 lakh.

It additionally prolonged the due date of assorted compliances, together with the final date of linkage of Aadhaar with PAN from June 30 to September 30, 2021, in addition to final date for fee underneath Vivad se Vishwas by 2-4 months.

Many taxpayers have obtained monetary assist from their employers and well-wishers for assembly their bills incurred for therapy of Covid-19. “With a purpose to make sure that no earnings tax legal responsibility arises on this account, it has been determined to supply earnings tax exemption to the quantity obtained by a taxpayer for medical therapy from employer or from any particular person for therapy of Covid-19 throughout FY20 and subsequent years,” the Central Board of Direct Taxes (CBDT) stated in an announcement.

“It has been determined to supply earnings tax exemption to ex-gratia fee obtained by members of the family of an individual from the employer of such particular person or from different particular person on the dying of the particular person on account of Covid-19 throughout FY20 and subsequent years. The exemption shall be allowed with none restrict for the quantity obtained from the employer and the exemption shall be restricted to Rs 10 lakh in mixture for the quantity obtained from every other individuals.”

Needed legislative amendments for the above choices shall be proposed sooner or later of time, it added.

In view of the influence of the Covid-19 pandemic, taxpayers are dealing with inconvenience in assembly sure tax compliances and likewise in submitting response to numerous notices. Amongst a bunch of due date extensions, the CBDT prolonged the final date of linkage of Aadhaar with PAN underneath, which was earlier prolonged to June 30, 2021 is additional prolonged to September 30, 2021.

The final date of fee of quantity underneath Vivad se Vishwas (with out further quantity) which was earlier prolonged to June 30, 2021, is additional prolonged to August 31, 2021. Final date of fee underneath Vivad se Vishwas (with further quantity) has been notified as October 31, 2021.