Economy

Startups Not To Be Approached Without Confirmation from AT

A circular was issued by the Central Board of Direct Taxes (CBDT) reiterating solutions on the so-called angel tax which have been impacting startups for quite a while.

The circular stated that income tax demand concerning the additions made under Section 56 (2)(vii b) would not be attended to by the authorities. It was further added that the taxmen should in no way communicate directly with the startup entities regarding the outstanding income tax demand.

Also Read: FinBlue, a Centre of Excellence, to Mentor FinTech Startups

Startups, from now on, will be approached for outstanding tax demand by taxmen only after the appellate tribunal approves the demand.

The CBDT, in a statement, announced that all circulars/clarification issued on the matter had been consolidated to ensure compliance of the startups.

Addressing issues concerning the pending assessments, CBDT added that a deadline had been set by the board for the completion of the pending procedures. While the deadline for cases with limited scrutiny concerning Section 52 (2) (vii b) has been set on 30 September 2019, the board wishes to dispose of all the remaining cases by 31 October 2019.

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