Payroll and ComplianceThe Monthly Chronicle - January, 2017--> Share           var switchTo5x=true;stLight.options({publisher: "a774d07d-a09d-4a2f-a103-57088fe922e2", doNotHash: false, doNotCopy: false, hashAddressBar: false, tracking: false});


Benefit of Section 80CCG withdrawn from FY 2017-18

The Section 80CCG (Rajiv Gandhi Equity Savings Scheme) was introduced as a part of the Finance Act, 2012. Currently, under the Section 80CCG, deduction would be allowed for investment made by resident individual on listed equity shares or listed units of an equity oriented fund – subject to certain conditions for an amount equal to amount invested or Rs. 25, 000 (whichever is lower) for three consecutive assessment years.

The Union Budget announced on 2nd Feb 2017 proposed that the deduction under Section 80CCG will no longer be allowed from financial year 2017-18 for any new investors.

However, an assesse who has claimed deduction under Section 80CCG for the financial year 2016-17 or before and has an unclaimed amount of investment carried forward, then he or she shall be allowed to claim the deduction under this Section till the financial year 2018-19.

Income Tax Act – Section 71B amended

Restriction on carry forward of loss in case of let out property

Till date, loss under the head “Income from house property” can be set off against all income sources. However, if the loss is unadjusted in the same year then the same can be carried forward and adjusted for up to eight subsequent assessment years.

From this year onwards, there is a preposition to introduce restriction on inter-adjustment of loss under house property.

From April 2017, any loss from let out house property can be claimed only up to Rs. 2,00,000 in a year against income from other sources. Any excess of unadjusted loss incurred in the financial year would be carried forwarded and claimed in the subsequent eight years only against income from house property.

Before April 2017 After April 2017 Rental Income                                                       
Less: Rs. 6,00,000 Rental Income                                                    
Less: Rs. 6,00,000 30% of Standard deduction                          
Interest on Home Loan (Rs.10,50,000)
(Rs. 1,80,000) 30% of Standard deduction  
Interest on Home Loan (Rs.10,50,000)
(Rs. 1,80,000) Loss from House Property 
(Rs. 6,30,000) Loss from House Property 
(Rs. 6,30,000) Before April 2017 After April 2017 Income from Salary Rs.12,00,000 Income from Salary                                       Rs. 12,00,000 Loss from House property                         
(Rs. 6,30,000) Loss from House property                         
**(Rs. 2,00,000) Net Income    Rs. 5,70,000 Net Income Rs. 10,00,000 **Note: The balance loss of Rs.4,30,000 would be carried forward and claimed in next 8 years against income from House property Employee Provident Fund Organization (EPFO) provides obligation of Principle Employer

Recently, the EPFO has defined the list of obligation or responsibility of principle employer through a circular and via email communication to all employers. The obligations and responsibilities are as follows:

  1. The Principal employer should ensure that the contractor is registered with the EPFO before awarding any contract. After awarding the contract, the employer is obligated to enter the contractor’s details in the EPFO portal.
  2. Payments due to the contractor should be made only after verifying that the statutory PF payments have been made to EPFO. This can be verified either directly from the EPFO portal or by insisting on a payment receipt obtained by the contractor from the EPFO portal while making payment.
    Note: There is a provision made on the official website of EPFO wherein, employers may verify whether their contractors are regularly depositing provident fund contributions on behalf of their respective employees under the "establishment search option".
  3. Principal employer can also deduct EPF dues from the contractors' bill and deposit the same either against the contractors' code number or their own code number.
    Note: It is further clarified that even if the contractors are having separate PF code number, the overall responsibility of ensuring the compliance under the EPF & MP Act, 1952 (Employees’ Provident Fund & Miscellaneous Provisions Act, 1952) for the employees working through the contractors (by deposit of the dues with the EPFO regularly) rests with the principal employer.

To read further please click here

EPFO introduces composite claim forms

The Provident Fund department on 1st December 2015 released new forms for withdrawing and transferring of PF balances viz., Form 19 (UAN), Form 10C (UAN), Form 31 (UAN) with a view to simplify the process of claim for the subscriber. However, still all the forms required employer attestation.

In order to make the claim process transparent and efficient, the EPFO department has requested the subscriber to seed in AADHAR and bank details while applying for UAN number.

Now the EPFO department has released 2 new forms:

  1. Composite Claim Form (AADHAR) which can be submitted to respective jurisdictional EPFO officer without employer attestation.
  2. Composite Claim Form (Non-AADHAR) which can be submitted to respective jurisdictional EPFO officer only after employer attestation.

To check the forms and requirement please click here.

New TDS RPU and FUV utility released

New versions of e-TDS/TCS Return Preparation Utility (RPU) and File Validation Utilities (FVUs) have become applicable from the 23rd of February, 2017.

Key features of the new version:

  1. Validation for “PAN of Landlord” for Form 24Q-Q4 under Annexure II (i.e. salary details) from FY 2016-17 onwards: Existing validation of valid PAN requirement for claiming HRA exemption (for more than Rs.1,00,000/-) has been relaxed. In case the assesse does not have a valid PAN, the below codes can be used while filing TDS returns:
    GOVERNMENT: This is applicable when landlords are Government organizations (i.e. Central or State).
    NONRESDENT: This is applicable when the landlords are Non‑Residents.
    OTHER VALUE: This is applicable when the landlords are other than Government organization and Non-Residents.

  2. Deductee/Collectee against which Form 26A/27BA has been generated at Income Tax Department where update will not be allowed on certain fields in Annexure I of Form 24Q, 26Q and 27EQ while submitting correction statement. The certain fields are as below:
    - PAN of Deductee/Collectee
    - Amount of Payment/Credit
    - Total tax Deducted (Tax + Surcharge + Education cess)
    - Section code

  3. Deductee against which Form 26A/27BA has been generated at Income Tax Department where no update or deletion of record will be allowed in Annexure II of Form 24Q while submitting correction statement. Such Deductee/Collectee records will be present in the TDS/TCS consolidated file with a flag value ‘F’ against the field ‘Mode’ as per specified file format.

To download the new TDS files click here

New provision for filing E-TDS returns online

Earlier this month, the Income Tax Department of India created a new provision for filing E-TDS online without the need of a Facilitation Centre.
Mentioned below is the procedure for doing the same:

Step 1: Registration on Traces Website

  1. Go to the website -
  2. Click on ‘Register as New User’ and select ‘Deductor’ and ‘Proceed’ by filling the required fields and get registered.

Note: Use a challan which has multiple PAN in deductee records. Please don’t repeat PAN in deductee details.

Step 2: Login to Traces Website and register under “Register at E-Filing Site”

Step 3: Login to Income Tax Portal (

  1. Register the Digital Signature Certificate (DSC) of Deductor’s authorized person (Partner, Director etc). At the instance this is not done, you have to verify the return via a Demate Account or Online Banking or Aadhar OTP respectively.
  2. With the help of TDS returns preparations software or utility generated FVU file, create ZIP folder of the FVU file.
  3. Upload the file in TDS option within the Income Tax E-Filing portal (presently last option in TAB) and ‘save’ the acknowledgement receipt.


Maternity Benefit (Amendment) Bill passed

The Ministry of Labour and Employment has passed an amendment within the Employee's State Insurance Scheme amending the maternity applicable to pregnant women.

Highlights of the Bill are as follows:
  1. The duration of maternity leave has increased from 12 weeks to 26 weeks.
  2. Maternity should not be availed before eight weeks (earlier it was six weeks) from the date of expected delivery.
  3. For a woman who has two or more children, the maternity benefit will continue to be 12 weeks and cannot be availed before six weeks from the date of the expected delivery.
  4. The Bill currently grants 12 weeks of maternity leave to:
    (i) a woman who legally adopts a child below three months of age; and
    (ii) a commissioning mother.
    (A commissioning mother is defined as a biological mother who uses her egg to create an embryo implanted in another woman. The 12-week period of maternity benefit will be calculated from the date the child is handed over to the adopting or commissioning mother.)

  5. The Bill allows employers to permit a woman to work from home if the nature of work assigned, permits her to work from home. This option can be availed after the maternity leave period for a duration that is mutually decided by the employer and the concerned woman.
  6. The Bill requires every establishment with 50 or more women employees to provide crèche facilities within a prescribed distance. They will be allowed four visits (including her intervals for rest) to the crèche in a day.
  7. The Bill requires every establishment to intimate a woman (both in writing and electronically) at the time of her appointment; the maternity available to her.
Compliance Calendar for the month of March, 2017 Due date Nature of transaction Existing rules Mode Professional Tax - States - Remittances 10th March 17 Andhra Pradesh & Madhya Pradesh State-wise regulations By Challan 15th March 17 Gujarat Gujarat PT regulations By Challan 20th March 17 Karnataka Karnataka PT regulations By Challan & Online 21st March 17 West Bengal West Bengal PT regulations By Challan 30th March 17 Assam & Orissa State-wise regulations By Challan 30th March 17 Maharashtra Maharashtra PT regulations Online PF Central 15th March 17 Remittance of Contribution EPF & MP Act, 1952 Online ESI Central 21st March 17 Remittance of Contribution (Main code and Sub codes) ESIC Act, 1948 Online TDS 7th March 17 TDS Payment Income Tax Act, 1961 Online Labour Welfare Fund Remittances 15th March 17 Kerala State wise regulations By Challan
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