Filing Form 10E is Mandatory to Claim Relief under Section 89(1)

Form 10E is a form that must be filed by taxpayers to claim relief under section 89(1) of the Income Tax Act. Form 10E helps in calculating tax outflow on any arrears of income received from changes in taxation rules applicable in both the years, year of receipt, and the year to which such income pertains. Form 10E can also help you calculate your taxes if there has been a change in taxation rules for a particular period due to which you have accrued income from different sources. Form 10E is mandatory as it helps with claiming relief under section 89(1). Taxpayers should file Form 10E if there is any change in taxation rules for the period to which the income relates. Change in taxation laws includes changes that occurred due to budget proposals, amendments, or changes in tax treaties. For example, if you receive arrears of salary, Form 10E can be used to calculate tax outflow on such arrears due to changes in taxation rules applicable in the year of receipt. If it is not filed, relief under section 89(1) cannot be claimed. Form 10E can be used when tax outflow is increased due to changes in taxation rules. Form 10E should be filed with the return of income for the relevant assessment year within the time limit prescribed by law or extended by CBDT.

The latest update is as follows:

On 9th September, the CBDT released a circular extending the deadlines for certain direct tax obligations for AY 2021-22.

1. ITR Filing due to date extension:

i)The Income Tax Return filing deadline for taxpayers not being audited is extended from 30th September 2021 to 31st December 2021. ii) The IRS's deadline for submitting an ITIN application for Tax Audit cases is extended to February 15, 2022. iii) The filing date for ITR has been extended until February 22. iv)The due date for the ITR filing of a Belated or Revised Return for FY 20-21 is extended from December 31, 2021, to March 31, 2022.

1. Furnishing Audit Report:

i)The deadline to submit the audit report was postponed until January 15, 2022. ii)The due date for submitting an audit report in transfer pricing cases has been extended to January 31, 2021. The Filing Deadline Extension is now available from Jan 31, 2021.: i) Income Tax Return filing by taxpayers not covered under audit is extended from 30th Sep 21 to 31st Dec 21 ii) The due date for submitting an ITR filing in Tax audit instances is extended to February 15, 2022. iii) ITR filing for transfer Pricing is extended to 28th Feb 22 iv) The due date for the ITR filing of a Belated or Revised Return for FY 20-21 is extended from December 31, 2021, to March 31, 2022. Furnishing Audit Report: i) The deadline to submit the audit report was extended to January 15, 2012. ii)The deadline for submitting an audit report in transfer pricing cases has been extended to January 31st, 2022.

What Is Relief under Section 89(1)?

The tax rate is determined by your entire yearly revenue. If you have paid any prior year's dues in the current year, you might be concerned about paying more taxes (usually tax rates have risen over time). You may benefit from Section 89(1) relief to save you money on taxes owing to delayed income payment under Rule 21A read with Rule 89(1). You are entitled to some tax reduction under Section 89(1) along with Rule 21A if you have received any portion of your salary in arrears or in advance, or if you received a family pension in arrears.

Income Tax Notice for Non-Filing of Form 10E

The Income Tax Department has made it necessary to submit form 10E if you wish to claim relief under Section 89(1) for the Financial Year 2014-15 (The Assessment Year 2015-16). Taxpayers who have received an income tax notice from the Income Tax Department stating that their relief u/s 89 has not been allowed in their case because they did not file form 10E have been informed that - The relief u/s 89 has not to be allowed in your case, as you did not submit Online form 10E. According to sec.89 of the Income Tax Act, it is necessary to provide Online form 10E

How to File Form 10E

Form 10E may be submitted online. The following are the stages for submitting Form 10E via the internet: –

• Login to https://incometaxindiaefiling.gov.in/ with your User ID and password along with the date of birth.
• After you have logged in, click on the tab named ‘e-file’ and select ‘Prepare & Submit Online Form (Other than ITR)’.
• On the next page, click on Form No. 10E and then click on submit.

After Form 10E has been submitted, you can see the confirmation number at the end of Form 10 E which will be quoted every time you log in to submit Form 10E. Form 10E Form is mandatory to claim relief under Section 89(1) of the Income Tax Act. This will help you in claiming relief from any change in taxation rules, which may increase your tax outflow for a particular year. If you have questions about what form you need or how to file it, contact us today and we’ll be happy to walk you through each step!

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