Good news for more than 10 million taxpayers who got letters from the Income Tax Department asking for taxes up to Rs 100,000.
The Central Board of Direct Taxes announced on February 13, 2024, that the Income Tax Department will now cancel old tax demands until January 31, 2024, giving relief to these taxpayers.
They mentioned that any tax demand up to Rs 100,000 will be forgiven.
The order states that for the assessment year 2020-21, tax demands up to Rs 25,000 will be canceled annually until January 31, 2024.
For the assessment years 2011-12 to 2015-16, tax demands of Rs 10,000 per year will be waived.
However, the total waived amount should not exceed Rs 100,000. Former ICAI President Ved Jain commented that this move by the government seems to be a way to clear old tax demands and tidy up the books.
The Central Processing Centre in Bengaluru has two months to implement this order.
During the interim budget presentation on February 1, 2024, Finance Minister Nirmala Sitharaman provided significant relief to one crore taxpayers.
She announced the withdrawal of direct tax demands up to Rs 25,000 for the periods up to the financial years 2009-10 and 2010-11.
Additionally, outstanding income tax demands up to Rs 10,000 from the financial year 2014-15 would be withdrawn.
This decision is expected to benefit one crore taxpayers.
Sitharaman highlighted that this decision aligns with the government’s goal of enhancing Ease of Living and Ease of Doing Business.
Many small, unresolved, or disputed direct tax demands, some dating back to 1962, are still pending with the Income Tax Department, causing difficulties for honest taxpayers and delays in issuing tax refunds.
Therefore, the government made this significant decision to alleviate these issues.
