Taxes are one of the major sources of income for the government, which is further utilized for the welfare of the country and state. As income tax is a considerable share of government’s revenue, the government has made it mandatory for every citizen to pay a certain amount of tax on their income. Well, on late filing of ITR the government charges several penalties from the taxpayers, so it is better to File Income Tax Return on time.
Income-tax is a tax imposed by the Central Government on the earnings of a person and is governed by the Income-tax Act, 1961. Income–tax return (ITR) is a report of income and tax thereon, which is to be submitted or filed by a taxpayer to the Income-tax Department in authorized form.
What is an ITR ?
Income Tax Return is a form containing all income information about a person and also the tax applicable on the earning. The income tax department requires you to fill your ITR in the specified form before the due date. The Income Tax Department has specified 7 different kinds of forms. Which form is applicable to you depends on your constitution, sources of income etc.
Note: File ITR on time and get all benefits.
Benefits of Income Tax Return
- Carry Losses Forward :
As per income tax laws, one can equalize their future incomes and carry losses such as capital loss, business loss, and more. Losses can be carried forward only if the ITR is filed accurately and before the due date of Filing.
- Dodge Penalties :
As mentioned earlier, the tax department levies penalties for failing to file taxes on time, so you may be penalized and may have to shell out extra money as late fees or interest on delayed payment of taxes if you don’t file your tax returns timely.
- For VISA Processing :
If you plan to apply for a visa, you must know that the visa processing system requires you to submit your tax returns. For instance, countries like the UK, Europe and the USA have made Income Tax Returns as mandatory part of VISA Application documents.
- Loan processing :
Filing ITR on time helps in the process of applying for loans as it improves your records and many banks demand to provide your tax returns for the past few years to comprehend your financial situation.
Who Should File ITR ?
Every individual whose annual gross income exceeds the basic exemption limit mentioned in the table has to file for ITR.
Following is the amount of Income-tax return for every age group.
|Individuals below 60 years||Rs. 2.5 Lakh|
|Individuals above 60 years and below 80 years||Rs. 3 Lakh|
|Individuals above 80 years||Rs. 5 Lakh|
Different ITR Forms? Find which one is applicable to you
|Types of ITR||Eligibility to File an ITR|
Indian Resident with income up to Rs. 50 lakh.
Sources of income include:
● Other sources
● One house property
Individual and Hindu Undivided Family having a total income of more than Rs. 50 Lakh.
Sources of income include:
● Capital Gains
● More than one house property
● Foreign income
● Holding unlisted equity shares
|ITR-3||This ITR comprises every income from ITR-2 and earning of more than 50 lakh from Business/profession as a partner in a firm.|
● Resident Individuals and Firms (other than LLP) having total income up to Rs.50 lakhs from business and profession.
● Computed under Section 44AD, 44ADA, or 44AE of the Income Tax Act, 1961.
|ITR-5||Partnership firms and business entities such as LLPs, AOPs, and BOI|
● All sources of income filing income tax, Or,
● Or companies not claiming exemption under section 11
|ITR-7||Filed by Individuals, charitable companies, scientific research associations, political parties, hospitals, news agencies, trade unions, universities, NGOs, etc.|