Income Tax Return (ITR) – ITR Filing, ITR Types

A form that is used to declare the net tax liability, claiming of tax deductions, and to report the gross taxable income is called Income Tax Returns. It is mandatory for those people who earn a particular amount of money to file ITR. Firms or companies, Hindu Undivided Families (HUFs), and self-employed or salaried individuals must file ITR to the direct tax Department. Income tax filing are often defined due to the procedure by which ITR is filed. The process by which taxpayers file their returns online is called efiling or ITR filing and it can be completed on the Income Tax Department website.

Types of ITR forms

Depending on the type of income that is generated by the taxpayer, the form that must be submitted will be different. The various forms are often downloaded from the official website of the direct tax department https://www.incometaxindia.gov.in/pages/downloads/income-tax-return.aspx. The different forms of ITR forms that are available are mentioned below:

ITR Form Name Applicability
ITR-1 The form has to be used by a person who make an yearly income of less than Rs.50 lakh via pension or salary and from only one house property.
ITR-2 The form must be used by shareholders of private companies, Directors of Companies, Non-Resident Indians (NRIs), or individuals who make an income via capital gains, from two or more house properties, and from foreign sources. However, the income of the individual must be more than Rs.50 lakh.
ITR-3 The form has to be used by a person who run a proprietorship or are professionals in India.
ITR-4 Individuals who are under the probable taxation scheme must use this form. In order for those people to join the scheme, they want to earn but Rs.60 lakh from professional income or but Rs.3 crore from business income.
ITR-5 In order for association and body of Limited Liability Partnerships (LLPs), partnership firms, and individuals to report their income and tax computation, this form must be used.
ITR-6 Those Companies who registered in India must use this form.
ITR-7 In case entities are claiming an exemption as universities or colleges, religious or charitable trusts, political parties, or scientific research institutions, this form must be used.

How to Download ITR Form?

Here is a step-by-step procedure to download the ITR forms:

    1. Visit https://www.incometaxindiaefiling.gov.in/home and click on ‘ITR File Return Preparation Software’ under the ‘Upload’ section

ITR Form India

    1. Select the assessment year.

ITR form

  1. Next, download the specified ITR form which may be found under the ‘Microsoft Excel’ column.

Importance of ITR Filing

Currently(FY 2019-20), is mandatory for one to file income tax returns in India if the following conditions are applicable –

  • If the gross total annual income (before deductions under 90C to 90U) is Rs. 2,800,000 (for ages less than 60 years), Rs. 3,00,000 (for ages 60 years but but 80 years) and Rs. 5,00,000 (for ages 80 years and above)
  • If it’s an organization or firm, regardless of the profit or loss made during a fiscal year
  • If a tax refund needs to be claimed
  • If a loss under a head of income must be carried forward
  • If being a resident of India, one has an asset or financial interest in any located near outside India
  • If being a resident of India, one may be a signing authority during a foreign account
  • If one receives income derived from property held under a trust for charitable or religious purposes or a party or a search association, press agency , educational or clinic , trade union, it is a not for profit university or any mumbaiinstitution , any authority, infrastructure debt fund, a hospital, body or trust.
  • If one is applying for a loan or a Passport
  • If an NRI derives any or all of his/her income through sources in India, that income is susceptible to be taxable in India, and tax returns for an equivalent will be necessary.

With the implementation of e-filing of tax Returns, the subsequent cases would require an e-filing Income Tax:

  • In case a refund is required
  • In case the gross total annual income exceeds Rs. 6,00,000
  • In case an income tax refund is required
  • ITR-3, 4,5,6,7 have to be mandatorily e-filed

Penalties for not filing ITR

The last date for filing returns for the FY 2018-2019 is 31 July 2019. In case the returns aren’t filed by the maturity , huge penalties are levied on the taxpayer. Apart from penalties, there might be other inconveniences and consequences that the individual would face just in case the returns aren’t filed. Depending on when the returns are filed after the maturity , individuals could face penalties between Rs.1,000 and Rs.10,000.

Given below is that the penalties that are levied for a delay in ITR filing for FY 2019-20:

Due Date of ITR Filing Penalty for Income below Rs.6 lakh Penalty for Income above Rs.8 lakh
31 July 2019 Nil Nil
From 1 September 2019 to 31 December 2019 Rs.1,000 Rs.5,000
From 1 January 2019 to 31 March 2019 Rs.1,000 Rs.10,000

Apart from penalties, just in case taxpayers are eligible to receive a refund, there’ll be a delay just in case the ITR is filed late. Taxpayers also need to pay a tenth interest on the pending amount just in case the returns aren’t filed on time.

Is it possible to file Income Tax Returns (ITR) without Form 16?

Yes, it’s possible to file tax Returns (ITR) without Form 16.

Steps to file ITR without Form 16

Although Form 16 is one of the most important documents required to file Income Tax Returns (ITR) for salaried individuals, it is possible to file the returns without Form 16 as well. There might be circumstances where the assessee might not get a Form 16. The possible reasons behind that can be the employer closing the business or the assessee quitting the job without the completion of the prescribed exit formalities. Either way, not receiving the shape 16 cannot stop a private from filing their returns. There a number of other documents which can be used as a reference while filing the returns. The following steps are to be followed to file tax Returns (ITR) without Form 16:

Step 1 – Computation of Income from Salary

The first and foremost step is to calculate the Income from Salary. The computation of the salary can be done with the help of salary slips, which will act as the main source of reference for the salary earned by the individual during the financial year. Thus, it is important to collect all the salary slips from all the employers for whom an individual has worked during the year. For the returns filed from this year, that is financial year 2017-18, an individual is required to furnish the complete breakup of his/her salary in the Income Tax Returns (ITR). Some of the fields that are needed to be furnished are income from salary or pension, allowances which are not exempted, deductions that are claimed under Section 16, profits arising from salary, and the monetary value of perquisites received by the assessee. Nevertheless, quite a few companies do not furnish the monetary value of the perquisites and the amount of profits arising from salary. In such cases, the assessee should get in touch with the Human Resource (HR) or the concerned accounts department of the company to get the above details. Other than the factors mentioned above, the allowances provided by the employer, contributions made towards provident fund (PF), and the tax deducted at source (TDS), etc. are furnished on the salary slips. It is also recommended to furnish and use the allowances provided by the employer to lower the liabilities . Allowances may include Leave Travel Allowances (LTA), House Rent Allowances (HRA), Transport Allowances (TA), etc. However, it is to be kept in mind that certain allowances are fully exempt under the act while others are partially exempt.

Step 2 – Tallying the Tax Deducted at Source (TDS) with Form 27AS

The Form 27AS is the form which contains the details of all the taxes that have been deducted from the salary of the assessee as well as any other source of income. Before proceeding to the filing of returns, the assessee should make sure that the figures reflecting on Form 26AS are in correspondence to the Tax Deducted at Source (TDS). In case the figures do not match and the returns are filed, the assessee will be receiving a notice from the Income Tax Department (ITD). Thus, just in case of discrepancies, it’s recommended to urge in-tuned with the deductor of the tax to urge a transparent picture of the deduction.

Step 3 – Computation of income from house property

In the event where an assessee receives a rent by letting a house property owned by him/her, he/she would be required to report the income under the ‘Income from house property’ head. In addition thereto , if the assessee has availed any housing loan (on the let loose property or on the self-occupied property) and is paying interest on such advances, then he/she will be eligible to get deductions under the same head for the interests being paid. Further, if the assessee is the owner of 2 or more than 2 house properties, then he/she needs to check the deemed let-out concept. In case of income being earned, an assessee can claim a deduction of 30% also as a deduction of the municipal taxes paid from the income .

Step 4 – Computation of income from capital gains

An assessee will be eligible to claim exemption on the gains earned from the sale of equities or equity-oriented mutual funds, provided they were held for more than a year and sold on or before 31st March of the respective fiscal year . However, as a document of proof, the summary statement of the equities or equity-based mutual funds has got to be collected by the assessee from the broker. In case of gains arising from the disposal of land or building, the assessee should have the acquisition and sale deed with him/her to ask it and have the accurate amounts for calculation.

Step 5 – Computation of income from other sources

The income from other sources is additionally required to be furnished within the tax Returns (ITR). Income from other sources include incomes such as interests earned on different bank accounts (including savings account, recurring deposits account, fixed deposits, etc.), interest earned on income tax refunds, income from pension or annuity, income from rented machinery, dividends received, plant, or furniture, etc. The details with regard to interest earned on tax refund are often found in Form 26AS. The details pertaining to the income from interest from bank accounts can be found in the respective bank passbook.

Step 6 – Computing and claiming available deductions

The next most important step for an assessee would be to figure out all the available deductions that can be claimed by him/her. As per the provisions of the Income Tax Act, there are various sections under which an individual can claim deductions. These sections are Section 80C, 80D, 80CCC, 80CCD, etc. The most common deductions such as life insurance, equity-linked savings schemes, Provident Fund (PF), Public Provident Fund (PPF), repayment of principal amount of home loan, etc. fall under Section 80C. Medical premium , on the opposite hand, falls under Section 80D. The Income Tax Act has a prescribed limit based on which the claims for deductions can be made. For example, under Section 80C, deductions can be claimed to the extent of Rs.1.5 lakh. Thus, it is necessary for an assessee to calculate all the deductions that he/she can avail in order to save on tax payment.

Step 7 – Computation of total taxable income

Once all of the above steps are completed, an assessee can figure out his/her total taxable income. To ascertain the entire taxable income, all the deductions need to be subtracted from the entire income arising from various sources. The end result is the total taxable income.

Step 8 – Calculation of income tax liability

For an assessee, it’s also important to determine the entire tax liability that he/she has. There are variety of third-party websites on the general public domain that gives the choice to determine the tax liability with the assistance of tax calculator. These tax calculators are often employed by an assessee to seek out out the ultimate tax liability.

Step 9 – Making payment for extra liabilities

After checking out the ultimate tax liability, if the quantity of tax paid as per the figures reflected in Form 26AS is a smaller amount than the particular liability, the taxpayer will be required to pay the balance amount of tax to the tax Department (ITD). However, if the quantity reflected in Form 26AS is sufficient or quite the particular liabilities , the assessee isn’t required to form any extra payment.

Step 10 – Filing the ITR

This is the ultimate step of e-filing without Form 16. Once all the above steps are successfully carried out, the assesses can login to his/her profile on the e-filing portal and file his/her Direct Tax Returns (ITR). However, it’s important to e-verify the returns within 120 days from the date of e-filing.

The steps mentioned above are often followed to e-file tax Returns (ITR) without Form 16. Keeping all the documents listed above handy will make the method of e-filing easier and hassle-free. It is also important to file the returns before the maturity to avoid late fees under Section 234F.

Frequently Asked Questions:

I am a self-employed professional. My income this year is below the minimum tax slab, but it had been higher within the previous 2 years and that i had filed ITRs then. Do I even have to file a return this year?

Ideally, if your income is below the minimum slab, you are doing not got to file your tax return. But if you’ve got been filing it previously, it might be better if you file a return this year declaring low income. This is because the tax Department may construe your non-filing as a delay or non-compliance due to your past record of filing ITR. They might send you a notice. In case you are doing not want to file ITR, be prepared to reply to the tax notice if it comes into your mail box.

If I even have already paid advance taxes and haven’t any dues or refunds, am i able to skip filing of tax return?

No, you have to file your ITR especially if you have paid the taxes. It is not an optional activity. An ITR gives the govt an entire record of how your income is distributed – assets, total income, liabilities , tax paid and refunds. This helps them monitor people for direct tax scam of any kind. If you fail to file ITR, you’re susceptible to pay penalty or face scrutiny and prosecution.

Is an ITR useful to me in my regular life?

Of course, yes. You’ll find a duly-filed ITR very useful as a symbol of income once you need to apply for a loan , once you need to make accident claims in third party insurance, for immigration and visa, for appointment in judicial and sophistication 1 jobs, for winning government tenders, for registration in professional panels, for seeking funding for a startup, etc.

How long can we got to wait to urge tax refund?

Refunds are disbursed only after your ITR is processed. This may take up to 1 year after you file your return. It is also possible that even if you are claiming refund, the taxman may have ascertained that you are not liable for a refund for various reasons such as a calculation error on your part. If you think that your calculations are right and you’ve got to urge a refund, then you’ll write to the I-T Department again. Sometimes, you do not get a refund because of wrong PAN or bank account number on the ITR, or the cheque not reaching you because of wrong address or you not being at home when the postman reached. If you filed your ITR online, you can check the status of your refund through your Income Tax e-filing account.

Which is the best way to file Income Tax Return?

There are multiple ways of filing tax Return. You can file your ITR yourself or take the help of a chartered accountant. The easiest way is to file your direct tax online yourself. You can do so on the website of the Income Tax Department. All you’ve got to try to to is fill the relevant columns on the ITR form and submit it. You can also choose to file your ITR using any third-party e-filing website as well. If you discover it difficult to file your ITR yourself and wish expert advice, then it’s best to require the assistance of a accountant .

Can I File tax Return after Due Date?

Yes, you’ll file your tax Return after the maturity . Due to unavoidable circumstances sometimes people are unable to file their ITR by the due date. In such cases, they need the choice of filing a belated return under Section 139 (4) before the top of Assessment Year or before the Assessment is completed (whichever is earlier)

How to Check the Status of tax Return?

Once you file your tax Return, you’ll check the status of tax Refund on the web site of the tax Department of India. You can check the status after 10 days, ranging from the date the refund is shipped by entering your Permanent Account Number and selecting the Assessment Year.

Which form should use to file Income Tax Return for Salaried Individuals?

Individuals who earn income from salary and interest need to fill and submit ITR 1 (SAHAJ) form while filing their tax Return.

What is Income Tax Return Notice?

If you are doing not file your tax Return in an Assessment Year, then you’ll receive a notice from the tax (IT) Department. The IT Department keeps a track on financial transactions and activities of people who are identified as non-filers. If there’s a discrepancy with the quantity of tax that you simply have declared in your ITR, then you’ll receive a notice from the IT Department. You may also receive a notice if the department wants to review any documents associated with the ITR that you simply have filed.

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