BASICS OF INCOME TAX
What is Income Tax?
-
It is a
charge levied on the total income earned by a person during the year.
-
Assessee
need to pay tax on income earned during the previous year in the current year (Ex:
Income earned during FY 2023-24 will be taxed in FY 2024-25).
Ø Except some cases i.e., income will be
taxed in the year in which it earned.
What is Income Tax Return?
-
ITR is a self-declaration
form that assessee needs to file to report income, deductions and taxes paid during
the previous year.
-
ITR Form
includes Sources of income, Deductions, Tax Liability, Taxes paid (TDS, Advance
Tax and Self-assessment tax) and Refund if any excess tax paid.
Who should file ITR mandatory?
-
If your
Gross total income before deductions exceed basic exemption limit, then you’ve
to file ITR mandatorily.
Ø Rs. 2,50,000 for individuals below 60 years
of age
Ø Rs. 3,00,000 for senior citizens of age
between 60 - 80 years
Ø Rs. 5,00,000 for super senior citizens
of age above 80 years.
-
Filing ITR
is mandatory even if your income is less than basic exemption limit in the
following cases:
Ø Deposited more than Rs. 1,00,00,000 in
Bank Accounts
Ø Incurred expenses more than Rs. 2,00,000
on foreign travel
Ø If Business turnover exceeds Rs.
60,00,000 or Professional receipts exceeds Rs. 10,00,000
Ø If you’re resident and have income
outside from india or Own foreign assets or having signing authority in a
foreign account
Ø Spent more than Rs. 1,00,000 on
electricity in a year
-
Other
Reasons
Ø To claim refund excess paid taxes or
TDS
Ø To carry forward business or capital losses
If you find yourself that you are liable to furnish Return of income, then you can register yourself in the IT portal by clicking here
Advantages
of filing of ITR
-
To avoid
notices, penalties and scrutiny notices from income tax department
-
Claiming of
refund of excess TDS
-
Valid
income proof for Bank loans, Vissa applications & Immigration processing
-
Carry
forward of Business and Capital losses
-
Having financial
track record helps in building financial credibility.
Due date
for filing of ITR
For Individuals / HUF / Salaried Employees 31st July of Assessment Year
For Business requiring Tax audit 31st October of Assessment Year
For Transfer Pricing Cases 30th November of Assessment Year
Income Tax Calculator
For determining tax liability, IT department provides a Tax liability calculator tool. You can go by clicking here
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