The salary will be deducted from those employees who fail to furnish PAN and Aadhaar details to their employers. (Photo Credit: Representational Image)
New Delhi :
Do you earn Rs 2.5 lakh per annum or above? If yes, then this is a very important information for you. The Income Tax Department has asked employers to deduct 20 per cent salary of those who have annual income of Rs 2.5 lakh and have not provided PAN and Aadhaar details. The deduction of salary will be as Tax Deducted at Source (TDS). The salary will be deducted from those employees who fail to furnish PAN and Aadhaar details to their employers.
The rule to deduct TDS from the salary of employees who have not furnished PAN and Aadhaar details was formulated by the Central Board of Direct Taxes (CBDT) and came into effect on January 16. The new rule will be applicable to those who earn more than Rs 2.5 lakh per annum.
In its 86-page page circular, the CBDT has made it compulsory for employees to provide PAN and Aadhaar details as per the Section 206-AA of the Income Tax Act. "Section 206AA in the Act makes furnishing of PAN or Aadhaar number, as the case may be, by the employee compulsory in case of receipt of any sum or income of amount, on which tax is deductible," the circular reads.
The Narendra Modi government’s move to reduce corporate tax rates and the sluggish economic growth is likely to result in the fall in the direct taxes for the first time in at least last two decades, according to a Reuters report, citing over half a dozen senior tax officials. The Modi government was targeting the corporate and income tax collection of Rs 13.5 trillion for the current financial year ending March 31 – a 17 per cent increase against the previous fiscal year.
However, due to a sharp decline in demand and lower investment and jobs has dented the direct tax collection target, prompting the government to forecast just a five per cent growth, the report said. According to a senior tax official, the government has collected only Rs 7.3 trillion in the direct taxes as of January 23. This is more than five per cent below the amount collected by the same time during the last fiscal year.