Table of Content…
- What is Income Tax?
- What is Income Tax Return?
- Why should you file an ITR?
- Types of ITR Forms?
- Documents required for filing the return?
- What is the due date for filing the return?
- E – Verification
- File Your ITR at just 500Rs
What Is Income Tax?
We live in a country and rely on public infrastructure such as roads, transportation, schools, and hospitals. We are protected by law and order, and we are secure from foreign countries through defence (like the army).
The majority of our needs are met by the government and administration’s provision of such services.
All of these activities necessitate funds. And the government collects this money through various taxes, the most important of which is the income tax.
Income tax is a levy or tax levied on a person’s earnings during a fiscal year. The Central Government is in charge of charging and collecting it. Unlike GST, income tax is a direct tax levied on and collected from the same person.
What Is Income Tax Return?
An income tax return (ITR) is a form used to report your earnings and taxes to the Income Tax Department.
A taxpayer’s tax liability is determined by their income.
If the return shows that too much tax was paid during the year, the individual is eligible for an income tax refund from the Income Tax Department.
Why Should You File An ITR?
Many people appear to believe that filing tax returns is voluntary, and thus dismiss it as unnecessary and burdensome. This is not a good way to look at tax filing.
In India, filing income tax returns (ITR) is required if any of the following conditions apply:
- If your gross annual income exceeds the basic exemption limit
- Those who wish to receive a refund for excess tax deducted/income tax paid.
- If you earned or invested in foreign assets during the fiscal year,
- If you are applying for a visa or a loan.
Regardless of whether they made a profit or not during the year, all registered companies generate income.
According to a recent amendment, you must file your return even if your income is less than the basic exemption limit in the following cases.
Have deposited more than Rs.1 crore in one or more current bank accounts; or Have deposited more than Rs.1 crore in one or more current bank accounts; or Have incurred an aggregate expenditure of more than Rs.1 lakh on electricity consumption.
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Types Of ITR Forms?
To date, the department has notified 7 different forms, namely ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, and ITR 7.
The applicability of ITR forms varies depending on the taxpayer’s sources of income, the amount of income earned, and the taxpayer’s category such as individual, HUF, company, etc.
A salaried employee is usually required to file a form under ITR 1 or ITR 2 based on the amount and sources of income.
Sahaj or ITR 1: This Return Form is intended for a resident individual in the following circumstances:
Income from a single house.
Other Sources of Income (excluding Winning from Lottery, bets on Race Horses, and other legal means of gambling).
Up to Rs. 5000 in agricultural income
Total earnings do not exceed Rs. 50 lakhs.
ITR 2: In addition to the income reported in ITR 1, ITR 2 will report the following:
Total income in excess of Rs. 50 lakhs
Income from more than one residential property
Capital Gains Income (Short Term & Long Term)
Other Sources of Income (Including Winning from Lottery, bets on Race Horses, and other legal means of gambling)
Documents required for filing the return?
- Permanent Account Number (PAN)
- Aadhar Card
- Form 16 – TDS certificate issued by the employer to provide details of the salary paid and TDS deducted on it, if any
- Form 16A – If TDS is deducted on payments other than salaries such as interest received from fixed deposits, recurring deposits, etc. over the specified limits as per the current tax laws
- Form 26AS – It is a consolidated annual tax statement. It has all the information about the taxes deposited against your PAN and all the income credited against your PAN.
- Annual Information System – Recently introduced by the government, AIS is a statement that provides complete information about a taxpayer for a particular financial year. It contains information about taxpayers’ incomes, financial transactions, tax details, income-tax proceedings, etc.
What is the due date for filing the return?
The department has fixed different due dates for different types of assessments.
Applicability of tax audit also decides as to which due date is applicable.
- The last date to file ITR for individuals/HUF/Firms is 31st July of the relevant assessment year (in case of no tax audit)
- In the case of Tax Audit Cases, the last date to file the return is 31st October of the relevant assessment year.
Tax Audit Cases
Transfer Pricing Cases
- You need to verify your Income Tax Returns to complete the return filing process.
- Without verification within the stipulated time.
- An ITR is treated as invalid.
- E-Verification is the most convenient and instant way to verify your ITR.
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