Equalisation Levy

The Equalisation Levy in India, governed by Chapter VIII of the Finance Act, 2016, imposes a tax on certain digital transactions to address taxation challenges in the digital economy. The charge of the Equalisation Levy is outlined under Section 165 and Section 165A of the Finance Act, 2016, which cover two distinct categories of transactions. […]

Here’s a detailed breakdown of the collection and recovery of Equalisation Levy (EL) under Sections 166 and 166A of the Finance Act, 2016, along with key compliance requirements and penalties: 1. Collection and Recovery under Section 166 (6% Levy on Specified Services) Applicability: Applies to payments for specified services(e.g., online ads, digital advertising space) to non-residents without a Permanent Establishment

Section 167 of the Finance Act, 2016 (Chapter VIII) governs the furnishing of statements for the Equalisation Levy in India, applicable to both the 6% levy on specified services (under Section 165) and the 2% levy on e-commerce supply or services (under Section 165A). Below is a concise and comprehensive explanation of the provisions for

Section 168 of the Finance Act, 2016 (Chapter VIII) governs the processing of statements furnished under Section 167 for the Equalisation Levy in India. This section outlines the procedure for processing the statements filed in Form 1 by persons responsible for deducting or paying the Equalisation Levy, applicable to both the 6% levy on specified

Section 169 of the Finance Act, 2016 (Chapter VIII) governs the rectification of mistakes in the context of the Equalisation Levy in India. This section provides a mechanism to correct errors or omissions in the statements furnished under Section 167 or in the intimations issued after processing under Section 168 for both the 6% levy

Here’s a detailed explanation of Section 170 (Interest on Delayed Payment of Equalisation Levy) under the Finance Act, 2016: 1. Overview of Section 170 Section 170 imposes simple interest at 1% per month (or part of a month) on delayed payments of Equalisation Levy (EL) by assessees or e-commerce operators who fail to deposit the levy within the due

Here’s a detailed breakdown of the penalties for failure to deduct or pay Equalisation Levy (EL) under Section 171 of the Finance Act, 2016, along with key compliance requirements and consequences: 1. Overview of Section 171 Section 171 imposes penalties on assessees (Indian residents or non-residents with a Permanent Establishment in India) and e-commerce operators who fail to comply

Here’s a detailed explanation of the penalty for failure to furnish the Equalisation Levy (EL) statement under Section 172 of the Finance Act, 2016: 1. Overview of Section 172 Section 172 imposes penalties for failing to file the annual Equalisation Levy statement (Form 1) as required under Section 167. This ensures compliance with reporting obligations for both: Assesseesdeducting EL (6%

Here’s a detailed explanation of Section 173 (Penalty Not to Be Imposed in Certain Cases) under the Equalisation Levy (EL) provisions of the Finance Act, 2016: 1. Overview of Section 173 Section 173 provides safeguards against penalties under Sections 171 (failure to deduct/pay EL) and 172 (failure to furnish EL statements) if the assessee or e-commerce operator can demonstrate reasonable

Here’s a detailed explanation of Section 40(a)(ib) of the Income Tax Act, 1961, which deals with the disallowance of expenses for failure to comply with Equalisation Levy (EL) provisions: 1. Overview of Section 40(a)(ib) This provision disallows certain expenses from being deducted when computing business income if: The payment is subject to Equalisation Levyunder the Finance Act, 2016, and The taxpayer fails to