Last updated: 28 September 2020
India (cont.)
Impact of COVID-19 on Mobility Page 62
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► Due dates for filing of appeal or furnishing of return and time limit for completion of proceedings by the authority and any compliance by the taxpayer including investment in saving instruments or roll over capital gains benefits where the time limit expires between 20 March 2020 to 29 June 2020 under various direct tax laws has been extended to 30 June 2020.
► Interest rate on the delayed payments of advance tax/self-assessment tax/regular tax etc. made between 20 March 2020 to 30 June 2020 has been reduced from 12%/18% to 9% per annum (i.e., 0.75%
per month instead of 1%/1.5% per month). Also, no late fee/penalty shall be charged for delay relating to this period.
► Public Sector undertakings will however continue to contribute 12 percent as employer contribution.
► The due date for payment of contribution to Provident Fund and administration charges/inspection charges for the month of March 2020 has been extended from 15 April 2020 to 15 May 2020 to employers who have disbursed wages for March 2020 to their employees.
► Subject to conditions, a non-refundable advance from the Provident Fund account of members may be granted not exceeding the basic wages and dearness allowances of that member for 3 months, or up to 75%
for the amount standing to the credit of the member in the Fund, whichever is less.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► The period of limitation in relation to assessments which are getting time barred on 30 September 2020 (i.e., for tax year 2017-18) is extended to 31 December 2020. Further, the period of limitation in relation to assessments which are getting time barred on 31 March 2021 is extended to 30 September 2021.
► The rate of withholding/collection of taxes for non-salaried specified payments (such as payment for contract,
professional fees, interest, rent, dividend, commission, brokerage, etc.) made to residents is reduced by 25% of their existing rates. The reduced rate will be effective from 14 May 2020 and will be applicable until 31 March 2021.
► The Government of India will pay the Provident Fund contribution of employer and employee for those establishments who have less than or equal to 100 employees, and have 90% of those employees whose earning are less than INR 15,000 per month. This was provided earlier for the salary month of March, April and May 2020. This support will be extended for another 3 months to salary months of June, July and August 2020.
► The statutory Provident Fund contribution for both employer and employee will be reduced to 10% from 12% for the next 3 months. Public Sector undertakings will however continue to contribute 12% as employer contribution.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Impact of COVID-19 on Mobility Page 64
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► Donations to the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) , a new fund set up in relation to COVID-19 related activities will be eligible for 100%
deduction from taxable income.
Donations made up to 30 June 2020 are eligible for deductions to the tax year 2019-2020.
► The Indian authorities have relaxed tax residency provisions for the tax year 2019-20 (April to March) on account of the COVID-19 pandemic. Presence in India during this said period will be disregarded for evaluating tax residential status for the tax year 2019-20 as summarized below. The benefit is provided only to individuals who are based outside of India and had come to visit India before 22 March 2020.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► Unable to leave India on or before 31 March 2020 (22 March 2020 to 31 March 2020) to be disregarded for determining residential status
► Quarantined in India on or after 1 March 2020 and left India in an evacuation flight on or before 31 March 2020
► Beginning of the quarantine period to date of departure to be
disregarded for determining residential status
► Quarantined in India on or after 1 March 2020 and unable to leave India on or before 31 March 2020
► Beginning of quarantine period to 31 March 2020
► Left India in an evacuation flight on or before 31 March 2020 (22 March
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Impact of COVID-19 on Mobility Page 66
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► The end date for compliances falling due between 20 March 2020 until 31 December 2020 has been extended to 31 March 2021. While this is a
general relaxation, shorter extension of due dates have been provided for specific compliances by taxpayers.
► The due date for filing of the belated and revised income-tax returns for tax year 2018-19 has been extended from 31 March 2020 to 30 September 2020.
► The due date for filing the withholding tax return by companies for the period January 2020 to March 2020 for salary has been extended to 31 July 2020 and due date of issuing salary withholding tax certificates to the employees for tax year 2019-20 is extended to 15 August 2020.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► The due date for furnishing the tax audit report for tax year 2019-20 has been extended to 31 October 2020.
► The due date for filing of the Income-tax returns for Income-tax year 2019-20 has been extended to 30 November 2020.
► Aadhaar-Permanent Account Number (PAN) linking has been extended from 31 March 2020 to 31 March 2021.
► The benefit of settlement under Vivad Se Vishwas Act without payment of additional amount shall be extended from 30 June 2020 to 31 December 2020.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Impact of COVID-19 on Mobility Page 68
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► The period of limitation in relation to assessments which are getting time barred on 30 September 2020 (i.e., for tax year 2017-18) is extended to 31 December 2020. Further, the period of limitation in relation to assessments which are getting time barred on 31 March 2021 is extended to 30 September 2021.
► Interest rate on the delayed payments of advance tax/self-assessment tax/
regular tax etc. made between 20 March 2020 to 30 June 2020 has been reduced from 12%/18% to 9%
per annum (i.e., 0.75% per month instead of 1%/1.5% per month). Also, no late fee/penalty shall be charged for delay relating to this period.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► In case of resident senior citizens, self-assessment tax for the tax year 2019-20 paid on or before 31 July 2020 shall be treated as advance tax such that if the balance self-assessment tax payable at the time of furnishing returns is less than INR 1,00,000, then no interest shall apply for delayed furnishing of returns until the extended due date of 30 November 2020.
► The rate of withholding/collection of taxes for non-salaried specified payments (such as payment for contract, professional fees, interest, rent, dividend, commission, brokerage, etc.) made to residents is reduced by 25 percent of their existing rates. The reduced rate will be effective from 14 May 2020 and will be applicable until 31 March 2021.
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Contact: Armapal Chadha
Last updated: 28 September 2020
India (cont.)
Impact of COVID-19 on Mobility Page 70
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► Donation to Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (‘PM CARES Fund’), a new fund set up in relation to COVID-19 related activities will be eligible for 100 percent deduction from taxable income. The donations made up to 30 June 2020 are eligible for deduction in relation to tax year 2019-20.
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Contact: Armapal Chadha
Last updated: 28 September 2020
Indonesia
Payroll compliance changes Tax compliance changes Social Security changes Other major changes
► Payroll tax for employee of organizations in certain industries with certain levels of income will be borne by the
Government up to tax period June 2021.
► On 17 February 2021, the Minister of Finance has issued the implementation regulation Peraturan Menteri Keuangan 18/PMK.03/2021 for Omnibus Law tax cluster. Below are the implementation regulations related to individual taxpayer:
► Resident taxpayer (SPDN) - There is no change in the regulations to determine an individual to be a tax resident in Indonesia. The PMK provides more detailed explanations about the definition of domicile and indicator of intention to reside in Indonesia.
► Foreign individual resident taxpayer -Foreign individuals who are considered as resident taxpayers will be subject to tax only on Indonesian-sourced income within four years of them becoming a tax resident if they possess certain expert skills i.e., the
► There is an update on salary cap maximum to calculate Pension contribution per March 2021 i.e., IDR 8,754,600. Previously, salary cap maximum to calculate pension contribution was IDR 8,939,700.
► A policy was announced on 9 February 2021 by the Indonesia government which has banned visitors until further notice. Exceptions apply for the following individuals:
► Holders of Temporary Stay Permit (ITAS) or Permanent Stay Permit (ITAP)
► Foreigners with a valid e-visa
► Medical, food, and humanitarian aid workers
► Crew members
► Foreign nationals who work at vital strategic projects, vital national objects and national strategic projects
► Note:
► Bullets 3, 4 and 5 above can be granted based on recommendation from the relevant ministries in Indonesia.