New Delhi: In a major relief for Indian taxpayers affected by the coronavirus pandemic, the government has exempted tax on the compensation received from employer to employees for COVID-19 treatment or as ex-gratia in case of death. The Finance Ministry said many taxpayers have received financial help from their employers and well-wishers for meeting expenses incurred on COVID treatment.Also Read - Good News: I-T Compliance Deadlines Extended; Tax on Employee's COVID Treatment Exempted
Other than the following tax exemptions, the Centre also provided relief on various tax compliance measures and extended deadlines for the same. Here are the key takeaways: Also Read - Income Tax Return Filing Alert: CBDT Has This Big Update
> Amount paid by an employer to employees for COVID-19 treatment would be tax exempt. Also Read - No Hike in Property Tax in Mumbai Till Covid-19 Situation Continues: Mayor Kishori Pednekar
Minister of State for Finance Anurag Thakur made the announcement on tax exemptions for COVID-19 treatment and deaths saying that the amount paid for medical treatment to an employee by the employer or to a person by any person on account of COVID-19 for 2019-20 and subsequent year won’t be taxed in hands of an employee or the beneficiary.
> Ex-gratia payment received from an employer by family members in case of death of an employee due to COVID-19 would also be exempt from income tax.
The MoS Finance said that ex-gratia payment by the employer to an employee’s family or by any person to any other person’s family on the death of employee or any other person on account of COVID-19 for 2019-20 or subsequent year will be tax exempted.
> Ex-gratia from any other person has been restricted to Rs 10 lakh.
> Deadline for Pan-Aadhaar linking extended: The last date for PAN-Aadhaar linking too has been extended by three months to September 30, 2021, while the same for furnishing Tax Deducted at Source (TDS) certificate in Form 16 to the employees by employers has been extended till July 31, from July 15, 2021.
> TDS filing due date extended: The due date for furnishing TDS statement for the last (January-March) quarter of the 2020-21 has been extended to July 15, from June 30, 2021. The quarterly statement in Form 15CC to be furnished by an authorised dealer for remittances made for the June quarter would have to furnished by July 31.
> Time to invest in residential house for tax deduction extended: The time to invest in residential property for tax deduction has been extended by more than three months and the due date for Vivad se Vishwas payment (without interest) has been extended by two months to August 31.