Income tax return filing in India
Income Tax Return is a form used to file income tax with the Income Tax department. As per the laws of income tax must be filed every year by an individual or an organization that received income during that year weather through regular wages, capital gains, interest, and any other sources.
ITR is filed to the income tax department by a salaried or self-employed individual, Hindu Undivided Family (HUF), companies or firms. The process of filing the ITR is referred to as income tax filing. In India income tax return filing is very important and in case you fail in filing an income tax return then you may face legal consequences for it. Income tax returns can be filed online on the e-portal of the income tax department. So this process of filing ITR online is defined as ITR e-filing.
Who is required to file ITR?
As per section 139(1) of the Income Tax Act, 1961, any individual whose total income in a financial year exceeds income tax exemption limit of 2.5k of per year then you liable for the income tax return.
Income Tax Department has made it mandatory to file income tax and it has set forth certain guidelines for Income tax return filing-:
- A person with an age of less than 60 years has an annual income greater than Rs.2.5 lakh.
- A person who is above the age of 80 years and has an annual income of more than Rs. 10 lakh.
- It is mandatory to file to Income tax return no matter a company is in loss or profit.
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Documents required to file ITR
- Form No.-16: If you are a salaried person, then this is one of the most important for you to file ITR. This form consists of two parts A and B.
- Part-A: This part includes all the details of the tax deducted by your employer during the year. Apart from these details of the tax deducted from your salary, it also consists of the details of your Permanent Account Number (PAN), PAN and TAN of your employer
- Part-B: The second part consists of your gross salary break-up details such as exempt allowances, perquisites, etc.
- Interest certificates from Bank and Post Office: ITR forms also ask taxpayers to specify the source of their interest incomes such as that earned on a savings account, fixed deposits or any other income. However, individuals can claim for deduction under section 80TTA of up to Rs 10,000 on the interest earned from savings account held with the bank and/or post office.
- Form-16A/Form-16B/Form-16C: If TDS is deducted on the payments other than salaries such as interest received from fixed deposits, recurring deposits, etc. over the specified limits as per the current tax laws, your bank (only in case of fixed deposits) will issue you Form-16A providing you the details of the amount of TDS deducted.
- Home loan statement from bank/NBFC: If you have taken a home loan from a bank or any other financial institution, don't forget to collect the loan statement for the last financial year.
- Aadhaar card: It is mandatory to provide Aadhaar card to successfully file your ITR. The section 139AA of the Income-tax Act made it mandatory that an individual is required to provide his/her Aadhaar details while filing the return of his/her income.
What is ITR?
ITR stands for Income Tax Return is a form in which taxpayers file information about the income he earns and tax applicable by the Income-tax department. There are 7 major forms notified by the department i.e. ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6, ITR 7. Every taxpayer is required to file his ITR on or before the specified due date. The applicability of ITR form differs depending upon the source of income of the taxpayer, the amount of income he earns and the category to which the taxpayer belongs like individuals, HUF, company, etc.
What are the forms of return prescribed under income tax law?
Different forms of returns are prescribed for different classes of taxpayers under the Income-tax law. ITR 1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6, ITR-7
Who can use ITR-1?
Return Form ITR-1 can be used by an individual whose source of income is:
- Income from salary/pension
- Income from house property
- Income from other sources
Who cannot use ITR-1?
- One who is non-resident
- Whose total income of the year includes income from more than one house property
- Whose total income of the year includes an agricultural income of more than Rs. 5000
- Whose total income includes income from business
- Who has claimed relief under section 90 or 91
- A resident having income from any source outside India
- Any resident having any asset located outside India
What is the eligibility to file ITR (Income Tax Return)?
It is necessary to file Income tax returns (ITR) in India if any of the below conditions are applicable to you. If your gross annual income is more than Rs. 2.5 lakhs in case of individuals below 60 years, More than Rs. 3 lakhs in case of individuals above 60 years but below 80 years and More than Rs.5 lakhs in case of individuals above 80 years.
If an individual has more than one source of Income like house property, capital gains, etc.
If a taxpayer want to claim an Income tax refund from the department
If a taxpayer is a company or a firm, irrespective of profit and loss
If an individual has invested or earned from foreign assets.
What is the e-filing utility provided by the Income-tax Department?
To generate e-return and furnishing of return electronically, the income tax department has provided free e-filing utility. The e-filing utility provided by the Income-tax Department is simple, easy to use and also contains instructions on how to use it. By using e-filing utility, a taxpayer can simply file their return of Income.
If excess tax has been paid how will it be refunded to me?
In case a taxpayer has paid excess tax then the excess tax can be claimed as a refund by filing Income Tax Return. It will be refunded by crediting it in the bank account of the taxpayer through ECS transfer.
Is the income of agriculturists taxable?
No, Agriculturist income is not taxable. In case you have non-agricultural income then when calculating tax non-agricultural income, your agricultural income will be taken into the account for the rate purpose.
Do I need to maintain proof or record of earnings?
From every source where you are earning you have to maintain proof of earning and the records specified under the Income-tax act. Maintaining records can help you to claim for the income tax return.
Can a return be filed after the due date?
Yes, if one could not file the return of income on time or before the due date, then he can file a belated return. This belated return can be filled within a period of one year from the end of the assessment year or before the completion of the assessment year whichever from the two is earlier but besides, it will attract some interest and penalties.