Covid-19 treatment, financial aid after death made tax free

An individual will not have to pay any income tax on financial aid received from an employer or others for the treatment of Covid-19.

The government has announced several measures to ease income tax compliance and additional relief measures for taxpayers during the coronavirus pandemic. Union minister of state for finance Anurag Thakur on Friday announced the measures related to tax concessions for payment towards the treatment of the coronavirus disease (Covid-19). Thakur said an individual will not have to pay any income tax on financial aid received from an employer or others for the treatment of Covid-19.

The government has also said that both the measures are applicable for FY20 and subsequent years. (Representative image)

Anurag Thakur said for aid received by the family of someone who succumbed to Covid-19, the tax relief will be applicable up to ₹10 lakh if it is given by any person other than the employer. Financial assistance offered by an employer, however, won’t have any cap on the tax exempted amount. The government has also said that both the measures are applicable for FY20 and subsequent years and that the Income Tax Act will be amended to provide for this relief.

Thakur said the finance ministry has also announced time extensions for various statutory obligations of taxpayers, including for linking permanent account number (PAN) with Aadhaar. He said that the last date for linking the PAN and Aadhaar cards has been extended from June 30 to September 30. The minister told ANI that for the Vivad se Vishwas Scheme, payment without interest extension has been granted for two months from June 30 to August 31. The government earlier extended the deadline for making payment under this direct tax dispute resolution scheme by two months till June 30. "Closing the scheme in the next two months with interest by October 31," Anurag Thakur said.

In another relief to income taxpayers, an extension of three months for a tax deduction for people investing in residential houses has been granted. "For tax deduction extension for more than three months, the investment required to be made on or after April 1, can now be made up to September 30. So, there is an extension of three months," Thakur told ANI.

The government also extended the time limit for various compliances by 15 days to two months or more. The time limit has been extended from June 30 to July 15 for filing tax deduction at source (TDS) statements. For issuing tax deduction certificates, the limit has been extended by 15 days--from July 15 to July 31--and for filing foreign remittance certificate, it has been extended from July 15 to July 31.

The extension has also been given for equalisation levy from June 30 to July 31 and that for uploading of forms of no TDS claims cases is from July 15 to August 31. Anurag Thakur also said that the extension for objection to the dispute resolution panel is from June 1 to August 31 and that the option to withdraw cases from the settlement commission is from June 27 to July 31.

(With ANI inputs)