Tax News Daily
The latest tax news from around the world, summarised and tagged for tax professionals. Updated twice daily.
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ITAT Quashes Section 270A Penalty as Assessee Was Not Informed of Actual Charge
India's ITAT quashed a penalty levied under Section 270A of the Income Tax Act, which deals with penalties for under-reporting or misreporting of income. The tribunal held that the penalty was invalid because the assessee was never properly informed of the specific charge being invoked against them during proceedings. This ruling underscores the principle of natural justice, requiring tax authorities to clearly communicate the nature of the charge so taxpayers can mount an adequate defense before penalties are imposed.
Taxpayers urged to get ahead of July Self Assessment payment deadline
HMRC is urging UK taxpayers to prepare ahead of the July 31 Self Assessment payment on account deadline. The reminder targets individuals who pay income tax through Self Assessment, including the self-employed and those with multiple income streams. HMRC encourages taxpayers to log into their online accounts to check amounts due, set up payment plans if needed, and avoid late payment penalties. Options such as Time to Pay arrangements are available for those who cannot pay in full. Early action is advised to prevent last-minute issues and reduce the risk of penalties or interest charges accruing on unpaid balances.
Ehling et al.: Tax Revenue from Realized Capital Gains
Academic research by Ehling et al. examines tax revenue generated from realized capital gains, analyzing how behavioral responses by investors — such as timing of asset sales — affect government receipts. The study explores the relationship between capital gains tax rates and realization events, contributing to the debate on optimal capital gains taxation and revenue forecasting. Findings have implications for personal income tax policy, particularly regarding rate-setting and the so-called lock-in effect, where higher tax rates discourage asset sales and reduce taxable realizations.
ITAT Delhi Clarifies: Once Form 10-IE Is Filed, New Tax Regime Option Continues Unless Withdrawn
The Income Tax Appellate Tribunal (ITAT) Delhi has ruled that once a taxpayer files Form 10-IE to opt into India's new tax regime, that election remains in force for subsequent assessment years unless formally withdrawn. The case clarifies the continuity of the new tax regime option for individuals and HUFs with business income, reducing uncertainty around whether taxpayers must re-file the form each year. This decision has significant implications for personal income tax planning, as it confirms the binding and ongoing nature of the Form 10-IE election under the Indian Income Tax Act.
Demonetisation Tax Shock Gets a Reality Check: Rajasthan HC Rules 60% Tax Under Section 115BBE Not Applicable for AY 2017-18
The Rajasthan High Court has ruled that the enhanced 60% tax rate under Section 115BBE of the Indian Income Tax Act is not applicable for Assessment Year 2017-18, providing relief to taxpayers who faced harsh tax treatment in the wake of India's 2016 demonetisation. The court's decision offers a reality check on retrospective application of punitive tax provisions introduced to target unexplained cash deposits during the demonetisation period. The ruling has broader implications for tax controversy cases stemming from demonetisation-era cash transactions and the scope of Section 115BBE applicability.
Tax Court Doesn’t Horse Around in New Hobby Loss Case
A US Tax Court ruling addresses a hobby loss case, examining whether an activity—likely involving horses—qualifies as a for-profit business or a hobby under IRC Section 183. Hobby loss rules disallow deductions for activities not engaged in for profit, making the profit motive determination critical. The case highlights the IRS's scrutiny of horse-related ventures, which frequently attract audit attention due to their lifestyle appeal and recurring losses. Taxpayers must demonstrate a genuine profit intent through factors such as manner of operation, expertise, time devoted, and history of income or losses. The ruling offers guidance for practitioners advising clients in similar situations.
Section 234C’s Hidden Cushion: The Lesser-Known 12% and 36% Advance Tax Rule
This article examines Section 234C of India's Income Tax Act, focusing on a lesser-known provision that reduces the standard 3% monthly interest rate on advance tax shortfalls to 1% (annualized 12%) or 3% (annualized 36%) under specific circumstances. The piece explains the cushion available to taxpayers who meet certain installment thresholds, helping them avoid full interest liability. It clarifies how the advance tax installment schedule interacts with these reduced rates, offering practical guidance for individual and corporate taxpayers seeking to minimize interest penalties on underpayment of advance tax during the financial year.
Guidance: Income Record Viewer for agents: service availability and issues
HMRC's Income Record Viewer (IRV) for agents is a digital service allowing tax agents to access clients' income and PAYE records held by HMRC. This publication tracks service availability, known issues, and updates for the IRV tool used by agents to verify employment history, pension income, and tax codes when preparing self-assessment returns. It is a practical tax administration tool relevant to personal income tax compliance in the UK, helping agents accurately assess client tax positions and reducing errors in tax filings.
Foreign Assets, Reassessment & Non-Residents: ITAT Special Bench Clarifies the 16-Year Rule
India's Income Tax Appellate Tribunal (ITAT) Special Bench has issued a clarification on the 16-year reassessment window applicable to cases involving undisclosed foreign assets held by non-residents. The ruling addresses the scope of reassessment proceedings under the Income Tax Act, specifically whether tax authorities can invoke the extended 16-year limitation period against non-resident taxpayers with foreign assets. The judgment draws important boundaries on jurisdiction and procedural fairness, providing clarity for non-residents on their exposure to prolonged reassessment and the evidentiary standards required to trigger the extended window under Indian tax law.
Presumptive Taxation vs. Stamp Duty Valuation: ITAT Draws the Line Against Double Taxation
India's ITAT has ruled against the double taxation of property transactions by drawing a clear distinction between presumptive taxation under Section 44AD and stamp duty valuation under Section 50C/43CA. The tribunal held that once income from a property transaction is assessed under the presumptive taxation scheme, tax authorities cannot separately invoke stamp duty circle rates to impute additional income on the same transaction. The decision provides significant relief to small taxpayers and real estate participants who faced dual tax exposure, reinforcing that presumptive taxation constitutes a complete code that overrides separate deeming provisions.
4 Steps to Get Ahead of Higher Taxes
This article outlines four practical planning steps individuals can take to prepare for anticipated higher taxes. Key strategies include accelerating income recognition into lower-tax years, maximizing contributions to tax-advantaged retirement accounts, harvesting investment losses to offset capital gains, and reviewing estate planning structures ahead of potential legislative changes. The guidance is aimed at high-income earners and investors facing possible expiration of current tax provisions. It reflects broader concerns about the sunset of TCJA provisions and underscores the importance of proactive personal income tax planning in an uncertain legislative environment.
Canadian Influencer Tax Guide: CRA Audit Risks, GST/HST Rules, Cryptocurrency Income, Foreign Reporting, and Tax Planning Strategies
A comprehensive tax guide for Canadian social media influencers covering key obligations and risks under the Canada Revenue Agency framework. Topics include GST/HST registration requirements once income thresholds are met, treatment of cryptocurrency income as either business income or capital gains, foreign income reporting obligations for brand deals with international companies, and CRA audit triggers specific to influencers such as unreported barter transactions and gifted products. The guide also outlines tax planning strategies including incorporation considerations, deductible business expenses, and proper record-keeping practices to minimize audit exposure and optimize tax positions.
Six Compulsory Income Tax Scrutiny Categories Every Taxpayer Should Know
Indian tax authorities have identified six mandatory income tax scrutiny categories that automatically trigger detailed assessment for taxpayers. These categories outline specific circumstances under which returns are compulsorily selected for scrutiny rather than random selection, helping taxpayers understand compliance risks. The categories cover high-value transactions, discrepancies between reported income and third-party data, foreign asset disclosures, and other red-flag indicators. Awareness of these triggers is critical for individual and corporate taxpayers in India to ensure accurate filings, maintain proper documentation, and reduce exposure to prolonged tax assessments and potential penalties.
Advocate: IRS had strong filing season for online taxpayers, weaker one for others
The IRS National Taxpayer Advocate assessed the 2026 filing season, highlighting a strong performance for online filers but weaker outcomes for those relying on traditional or in-person services. The report underscores a growing digital divide in tax administration, with taxpayers who file electronically benefiting from faster processing and refunds, while others face delays and service shortfalls. The findings raise concerns about equitable access to IRS services and point to ongoing resource and staffing challenges within the agency, prompting calls for improved support across all filing channels.
ITAT Quashes Reassessment of Section 80GGC Political Donation Claim Due to Limitation
India's Income Tax Appellate Tribunal (ITAT) has quashed a reassessment proceeding related to a Section 80GGC deduction claimed for a political donation, ruling it time-barred under limitation provisions. The taxpayer had claimed a deduction for contributions to a political party, which authorities sought to reopen. The ITAT found the reassessment notice was issued beyond the permissible limitation period, rendering it legally invalid. The ruling reinforces procedural safeguards against arbitrary reopening of assessments and highlights the importance of strict adherence to statutory time limits in Indian income tax reassessment proceedings.
The Importance of Separating Business and Personal Expenses
This article emphasizes the critical importance of keeping business and personal expenses separate for tax and accounting purposes. Mixing expenses can trigger IRS scrutiny, complicate tax filings, and potentially disqualify legitimate business deductions. The article advises maintaining dedicated business bank accounts and credit cards, keeping detailed records, and working with accountants to ensure proper expense categorization. Failure to separate expenses can lead to audit risks, loss of deductions, and legal liability issues, particularly for sole proprietors and small business owners who may blur the line between personal and business finances.
Guidance: Pension schemes newsletter 182 — June 2026
HMRC's Pension Schemes Newsletter 182 (June 2026) provides updated guidance for pension scheme administrators and practitioners in the UK. These newsletters typically cover legislative changes, administrative updates, and compliance requirements related to pension tax relief, annual allowances, lifetime allowances, and reporting obligations. Pension taxation is a significant area of personal income tax policy in the UK, affecting how contributions, growth, and withdrawals are taxed. The newsletter serves as an official communication channel between HMRC and the pensions industry on tax-related matters.
SARS Extends Deadline for Auto-Assessed Taxpayers in 2026
South Africa's Revenue Service (SARS) has extended the deadline for auto-assessed taxpayers in the 2026 tax filing season. Auto-assessment is a system where SARS pre-populates tax returns using third-party data and automatically issues assessments to qualifying individuals. The deadline extension provides affected taxpayers additional time to either accept their auto-assessment or file a manual return if they disagree with the pre-populated figures. This administrative measure affects personal income tax filers in South Africa and reflects SARS's ongoing efforts to streamline compliance and reduce the burden on individual taxpayers during the annual filing season.
Income-tax Act 2025: New TDS and TCS Forms Every Deductor Must Know
This article covers new TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) forms introduced under the Income Tax Act 2025 in India. It details the updated forms that deductors and collectors must use, explaining changes in compliance requirements, filing procedures, and deadlines. The piece is aimed at helping deductors navigate the revised regulatory framework, understand which forms apply to specific transaction types, and ensure accurate withholding tax compliance. The changes are part of India's broader effort to modernize and streamline its direct tax administration under the new income tax legislation.
Don’t Assume You Earn Too Little to File a Tax Return
This article addresses a common misconception among South African taxpayers who assume their income is too low to require filing a tax return. It highlights that certain individuals below standard income thresholds may still be legally required to submit returns under specific circumstances, such as receiving income from multiple sources, earning capital gains, or holding foreign assets. The piece serves as guidance for personal income taxpayers, urging them not to automatically opt out of filing obligations without first verifying their individual circumstances against SARS requirements, as non-compliance can result in penalties even for lower-income earners.
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