Month: February 2023

Budget 2023 Proposal: The government proposes to include payments made to micro and small enterprises within the ambit of section 43B of the Income Tax Act. Accordingly, a new clause (h) is proposed to be inserted in section 43B of the Act to provide that any sum payable by the assessee to a micro or small enterprise beyond the time limit specified in section 15 of the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 shall be allowed as a deduction only on actual payment. Points to Note: The proposed section is about allowance or disallowance of payments to micro or small enterprise. Medium Enterprises are not covered in the same. Section 15 of the MSMED Act mandates payments to micro and small enterprises within the time specified in…

Budget 2023 GST Proposal - GST returns can be filed up to 3 years from the due date of that return It is proposed that following GST Returns will now be allowed to be filed only up to 3 years from the due date of that return:a. GSTR 1b. GSTR 3Bc. GSTR 9 and 9C (Annual Return and Reconciliation Statement)d. GSTR 8 (TCS by E-Commerce Operator)

Budget 2023 GST Proposal ITC in respect of goods or services procured to fulfil obligations under Corporate Social Responsibility (CSR) as per section 135 of the Companies Act, 2013 is proposed to be blocked List of blocked credit in section 17(5) is set to further increase. ITC in respect of goods or services procured to fulfil obligations under Corporate Social Responsibility (CSR) as per section 135 of the Companies Act, 2013 is proposed to be blocked. There have been various opinions on this issue of whether ITC on CSR activities is available or not, many judgements given by AARs of Uttar Pradesh, Tamil Nādu etc have said that ITC on CSR shall be available whereas many AARs of Gujarat, Kerala etc have denied this credit. The proposed amendment says: It…

Budget 2023 GST Proposal Reversal of ITC on account of non-payment to the Supplier within 180 days Section 16 is being amended to bring it in line with the return filing system. Where a recipient does not pay the Invoice value and GST thereon to the supplier within 180 days, he is required to reverse the ITC proportionate to such pending payment. Currently said ITC amount is required to be shown as Output Tax liability and paid along with Interest In the proposed amendment, it will be shown as reversal of ITC in GSTR 3B and paid along with Interest. Another amendment provides that the recipient will be eligible to re-avail such reversed ITC once the pending payment has been paid to the Supplier, currently the law is silent on…

Budget 2023 Proposal A person who has opted for Composition Scheme can trade in goods through an Ecommerce operator A person who had opted to pay tax under Composition Scheme he was not eligible to do his business through an E-Commerce Operator like Amazon or Myntra. Section 10 is now proposed to be amended to facilitate such taxpayers whereby they can do business on such E-commerce Platforms. However, only persons engaged supply of Goods shall only be allowed to do so, supplier of services will not be allowed. Lastly all other conditions ofcomposition scheme shall apply, accordingly a Composition taxpayer is not be allowed to sell goods outside his state, this restriction shall apply and E-commerce operator will have to ensure that the goods are not sold outside the State…