The Central Board of Direct Taxes (CBDT) on August 05, 2024, issued a circular regarding the Non-applicability of a higher rate of TDS/TCS as per provisions of section 206AA/206CC of the Income-tax Act, 1961, in the event of the death of deductee/collectee before linkage of PAN and Aadhaar.
The following has been stated: -
•Several grievances have been received from the taxpayers where they have cited instances of demise of the deductee/collectee during the period (i.e. on or before May 31, 2024) before the option to link PAN and Aadhaar could have been exercised. In such cases, tax demands are standing against the deductor/collector due to failure to link the PAN and Aadhaar of the deceased person.
• To redress such grievances of the taxpayers, the Board, specifies that in respect of cases where a higher rate of TDS/TCS was attracted under section 206AA/206CC of the Act about the transactions entered into up to March 31, 2024 and in case of demise of the deductee/collectee on or before May 31, 2024, i.e. before the linkage of PAN and Aadhaar could have been done, there shall be no liability on the deductor/collector to deductor/ collector the tax under section 206AA/206CC, as the case may be. The deduction/collection as mandated in other provisions of Chapter XVII-B or Chapter XVII-BB of the Act, shall be applicable.
[Circular No. 08/2024]
