Can you make Public Provident Fund, NSC, SSY, ELSS, other tax-saving deposits till June 30 for FY20?

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Updated: March 26, 2020 1:13 PM

Tax-saving investment for FY 2019-20: There seems to be some confusion among taxpayers, as to how, or whether, they can make investments in instruments like Public Provident Fund (PPF), NPS, National Savings Certificates (NSC) to save tax till June 30, 2020.

tax saving investment for fy 2019-20Experts speak on whether you can make tax saving investment for FY 2019-20 till June 30 or not. Representational image

In order to provide relief to people amid nation-wide lockdown due to Coronavirus, Finance Minister Nirmala Sitharaman on Tuesday extended the last date for income tax returns for FY 2018-19 from 31st March 2020 to 30th June 2020. Also, as per the announcement of the Finance Minister, the timeline for tax-saving investment for FY 2019-20 has been extended till June 30, 2020. However, there seems to be some confusion among taxpayers, as to how, or whether, they can make investments in instruments like Public Provident Fund (PPF), NPS, National Savings Certificates (NSC), five-year Fixed Deposit to save tax even after March 31 to save tax for FY 2019-20. Experts are of the view that some clear guidelines from the government in this regard are required.

Sameer Mittal, Managing Partner, Sameer Mittal & Associates LLP and Chairman, told FE Online, “The Government on March 24, 2020 announced lot of relief measure for all the tax assessees. Last date to file the income tax return for the FY 2018-19 for the assesses who are yet to file the return has been extended to from 31st March, 2020 to 30th June, 2020.”

When asked about tax-saving investments for FY 2019-20 and FY 2018-19, Mr Mittal said, “Timeline to file belated ITR (for assesses who are yet to file the return) for FY 2018-2019 is extended till June 30, 2020, from March 31, 2020. Timeline for making tax-saving investments was March 31, 2019 for the FY 2018-2019.”

For FY 2019-20, he said: “Usually last 10 days of every financial year are very busy for the banks, mutual funds, wealth managers etc. as they help Individuals to complete their tax-saving investments. Because of Covid-19 outbreak taxpayers were worried to miss the investments due to lockdown situation in India as banks have also requested customers to do the transactions online. Basis the announcement made by the FM, taxpayers can breathe easily as the timeline to make tax-saving investments for the FY 2019-2020 has been extended till June 30, 2020, from March 31, 2020.”

Archit Gupta, Founder and CEO, ClearTax, said that a detailed clarification on tax-saving investments for FY 2019-20 is required. “During the last few days of March, a lot of taxpayers rush to close their tax-saving investments. There is a heavy flow of money to ELSS instruments. People queue up to make deposits to their PPF accounts, SSY accounts, opt for a 5 year FD etc. Due to closure and lockdown at various locations, people may not be able to venture out and make their investments or even to make sure they’ve deposited the minimum mandatory sum required. This step seems to ease up this compliance, allowing people to make deposits in April -June 2020, and be eligible to claim tax benefit for this in FY 2019-20. However, detailed clarification is still awaited.”

According to Gautam Sehgal, Partner, Risers Accelerator, “As per the provisions of the Income Tax Act, the last date for filing ITR for AY 2019-20, i.e., for the year ending 31st March 2019 was 31st March 2020. The same has been extended till 30th June 2020. This means that all belated returns, revised returns, response to notices, etc. issued for AY 2019-20 can now be filed till 30th June 2020.

“As regards the extension of time for making tax-saving investments like PPF, NSC, etc. for FY 2019-20, we will get a clear picture only after suitable notifications, are issued. We are eagerly awaiting such notifications,” he concluded.

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