Income Tax Return is a form which is used to file the income tax with the Income Tax Department.
Income tax is a tax imposed by the Central Government on income of a person.
Filing income tax is every citizen’s responsibility. The IT department verifies these declarations of income and if any amount has been paid in excess, the department refunds the amount to the assessee’s bank account. All entities are required to file the taxes on time to avoid penalty.
The form that contains information of income and tax paid of an assessee is called Income Tax Return. The Income Tax Department of India has various forms for it such as ITR 1, ITR 2, ITR 3, ITR 4S, ITR 5, ITR 6 and ITR 7.
Points to be Considered During Efiling of ITR
- Choose the correct income tax return form
- Clearly identify the heads of income under which it is taxable
- Declare all your assets if your income is more than Rs. 50 lakhs in a year.
- Keep all documents and proofs safe for any future reference.
- Should mention your Aadhar Number
- Study your Form 26AS i.e. tax credit statement
- Check your personal details
- Also add interest income earned from fixed deposits
- Don’t hide any of your source of income
- Report your exempted income
- Should verify your income tax returns
Benefits Of FILING INCOME TAX RETURN
Though According to income tax laws, filing the return and updating your ITR status is mandatory for every individual or entity whose income exceeds the threshold limit mentioned in the Income Tax Act-1961. There are certainly many benefits of filing of ITR:-
Avoid Penalty up to INR 10,000/- – This year, the government has introduced a new section in the Income Tax Act-1961, i.e. section 234F wherein failing to file ITR on due date July 31, 2018, attracts a mandatory penalty of ₹ 5,000/- that may extend up to ₹ 10,000/- if not filed before 31st December, 2018.
Avoid Tax Notice of non-filing of ITR – Remember, Uncle Sam is having an eye on your ITR status! In case you fail to duly file your Income Tax Return, you may get a tax notice from the Income Tax department, which would land you up in trouble. Better you timely fulfil the ITR filing process.
Get TDS Refund Back – If your client or employer deduct your TDS while making payment, it might be that you’re eligible for Tax Refund. On filing Income Tax Return you can claim your TDS credit and get a refund back excess TDS deducted over your net tax liability.
Ease in Availing Loans – Income Tax Return is a primary requirement of the bank and financial institution while sanctioning the loan. Income declared in Income Tax Return depicts your financial credibility which helps you to sanction loan easily.
Can take input or carry forward losses – Timely filing of income tax return make you eligible to carry forward your business & capital losses, if any, during a financial year which can be adjusted against income earned in the subsequent years and ultimately save your taxes.
Who can file online income tax return
Following of the taxpayers can file online income tax return:
- Taxpayers having total income of Rs. 5 lakh and above
- Individual or Hindu undivided family resident with assets located outside India.
- Taxpayer who is required to furnish a report of audit specified under sections 10(23C) (IV), 10(23C) (v), 10(23C) (VI), 10(23C) (via), 10A, 12A (1) (b), 44AB, 80IA, 80IB, 80IC, 80ID, 80JJAA, 80LA, 92E or 115JB of the income tax act.
- Firm (not under provisions of Section 44AB), association of person, body of individual, artificial juridical person, cooperative society and local authority.
- Taxpayer who is required to furnish return under section 139 (4B) of the income tax return
- Resident who has a signing authority in any account located outside India.
- Taxpayer claiming relief under section 90 or 90A or deductions under section 91.
- All companies.
-For Individuals, the last date of filing Income Tax Return is 31st July of next financial year
-For Companies & Persons who require tax audit under section 44AB, the last date of filing Income Tax Return is 30th September of next financial year
If you mandatorily requires filing income tax return but failed to do so then you are liable to pay penalty amounting to INR 5000
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If your total income exceeds Rs 5 lakhs.
If you have foreign assets
If you have agricultural income which is more than Rs. 5,000,
If you have taxable capital gains
If you have income from business or profession
If you have income from more than one house property.
The excess tax can be claimed as a refund by filing your Income tax return. It will be refunded and credited back into your bank account through ECS transfer. It is important to make sure no mistakes are made while mentioning bank details such as account number, IFSC code etc in the ITR form.
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