Haven’t filed ITR? Get ready to face higher TDS, lower in-hand salary

You could face a higher TDS if you income tax return (ITR) for the financial year 2020-21. 

New Delhi: Individuals who failed to pay their income tax return (ITR) for the financial year 2020-21 will now have to face a higher tax deduction at source (TDS) from the ongoing financial year, according to the latest notification by the Central Board of Direct Taxes (CBDT). Such taxpayers will also find themselves on the non-tax filers list. The circular pointed out that individuals will have to face a higher YDS if they didn’t file ITR for the fiscal years under review and the aggregate TDS and tax collected at the source exceeded Rs 50,000 in that financial years. 

CBDT said that the definition of a “specified person” has been amended in both section 206AB and section 206CCA. The department added that the "specified person" means a person who satisfies both the following conditions: 

1. The individual has not furnished the ITR for the assessment year relevant to the previous year immediately preceding the financial year in which tax is required to be deducted/collected. 

2. Aggregate TDS and tax collected at source are Rs 50,000 or more in that previous year.

“A list of specified persons is prepared as of the start of the financial year 2022-23, taking the previous year 2020-2 1 as the relevant previous year. List contains names of the taxpayers who did not file a return of income for the assessment year 202 1-22 and have an aggregate of TDS and TCS of fifty thousand rupees or more in the previous year 2020-21,” CBDT said in its circular.