Income Tax Return (business)

Income tax has to be paid by every individual person, Hindu Undivided Family (HUF), Association of Persons (AOP), Body of Individuals (BOI), corporate firms, companies, local authorities and all other artificial juridical persons that generate income.

Taxes are calculated on the annual income of a person, and an annual cycle (year) in the eyes of the Income Tax law starts on the 1st of April and ends on the 31st of March of the next calendar year.

The law recognizes and classifies the year as “Previous Year” and “Assessment Year”.

The year in which income is earned is called the previous year and the year in which it is charged to tax is called the assessment year.

For example: Income earned between April 1st 2014 and March 31st 2015 is called the income of the previous year and will be charged to tax in the next year, or the assessment year that starts on April 1st 2015.

Taxes are collected by the government in three primary ways:

  1. Voluntary payment by taxpayers into designated banks, like advance tax and self-assessment tax.
  2. Taxes Deducted at Source (TDS) which is deducted from your monthly salary, before you receive it.
  3. Taxes Collected (TCS).

COMPULSORY FILING OF INCOME TAX RETURN

It 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 80C to 80U) is Rs. 2,50,000 (for ages less than 60 years), Rs. 3,00,000 (for ages 60 years but less than 80 years) and Rs. 5,00,000 (for ages 80 years and above)
  • If it’s a company or firm, irrespective of the profit or loss made in a financial year
  • If a tax refund needs to be claimed
  • If a loss under a head of income needs to be carried forward
  • If being a resident of India, one has an asset or financial interest in any entity located outside India
  • If being a resident of India, one is a signing authority in a foreign account
  • If one receives income derived from property held under a trust for charitable or religious purposes or a political party or a research association, news agency, educational or medical institution, trade union, a not for profit university or educational institution, a hospital, infrastructure debt fund, any authority, body or trust
  • If one is applying for a loan or a visa
  • If an NRI derives any or all of his/her income through sources in India, that income is liable to be taxable in India, and income tax returns for the same will be necessary.

In the following cases will require an e-filing of Income Tax:

  • In case a refund is required
  • In case the gross total annual income exceeds Rs. 5,00,000
  • In case an income tax refund is required





ADVANTAGES

  1. Creating a favourable financial history - Online filing of the income tax returns actually creates a history of your financial records with the tax department in a much faster and easier way. This history is favoured by a lot of organisations, be it financial or otherwise, whom you might have a business relationship with in the future.
  2. Proof of financial record - Having an ITR-V form is always handy, since one can readily furnish the same as a proof for any kind of financial liability or opening a line of credit.
  3. In case one has missed filing tax returns for the previous year, every additional day till July 31 increases the penal interest. Thus, filing a tax return in advance is very advisable.

 




PROCESS FLOW


INCOME TAX SLAB RATE FOR A.Y. 2016-17:

For Individuals Below 60 Years of Age

Income Tax Slab

Income Tax Rate

Income up to Rs. 2,50,000

Nil

Income between Rs. 2,50,001 - Rs. 5,00,000

10% of income exceeding Rs. 2,50,000

Income between Rs. 5,00,001 - Rs. 10,00,000

Rs. 25,000 plus 20% of income exceeding Rs. 5,00,000

Income above Rs. 10,00,000

Rs. 1,25,000 plus 30% of income exceeding Rs. 10,00,000


For Resident Senior Citizens (age 60 years or more but less than 80 years)

Income Tax Slab

Income Tax Rate

Income up to Rs. 3,00,000

Nil

Income between Rs. 3,00,001 - Rs. 5,00,000

10% of income exceeding Rs. 3,00,000

Income between Rs. 5,00,001 - Rs. 10,00,000

Rs. 20,000 plus 20% of income exceeding Rs. 5,00,000

Income above Rs. 10,00,000

Rs. 1,20,000 plus 30% of income exceeding Rs. 10,00,000


For Resident Super Senior Citizens (age 80 years or more)

Income Tax Slab

Income Tax Rate

Income up to Rs. 5,00,000

Nil

Income between Rs. 5,00,001 - Rs. 10,00,000

20% of income exceeding Rs. 5,00,000

Income above Rs. 10,00,000

Rs. 1,00,000 plus 30% of income exceeding Rs. 10,00,000

 


FAQS

A taxpayer may pay tax in any of the following forms: 1. Tax Deducted at Source (TDS) 2. Tax Collected at Source (TCS) 3. Advance tax or Self-assessment Tax or Payment of tax on regular assessment. The Income-tax Department maintains the database of the total tax paid by the taxpayer (i.e., tax credit in the account of a taxpayer). Form 26AS is an annual statement maintained under Rule 31AB of the Income-tax Rules disclosing the details of tax credit in his account as per the database of Income-tax Department.
Form 16 is a certificate or a document that is issued to salaried personnel in India by their respective employers. The Form 16 is provided by an Employer to the Employee and is used by the employee as reference as well as proof of TDS while filing Income Tax Returns. Form 16 is divided in two parts – Part A and Part B. Part A is the certificate of TDS issued by employer. Part B is annexure containing details of salary paid, other income and tax deducted.
Filing of return is every taxpayer’s duty and earns for you the dignity of consciously contributing to the development of the nation. Apart from this, your income-tax returns validate your credit worthiness before financial institutions and make it possible for you to access many financial benefits such as bank credits, etc. You may also receive notices and demands for non-filing of Income Tax Returns if you do not file your returns in time.
Filing your individual tax return is mandatory by Income tax Law if the gross total income exceeds the basic exemption limit. Even if TDS is deducted from your salary by the employer, Income Tax filing is a proof that these taxes have been deposited in the government account. In many cases you are eligible for refunds and you can claim these only when you file your returns with the ITD
If you do not file your return the following implications would have to be faced: 1. Your income-tax returns validate your credit worthiness before financial institutions and make it possible for you to access many financial benefits such as bank credits, etc. 2. You will be issued a notice by the Income Tax department for non-filing of return 3. There could be additional interest and penalties levied 4. You will not be able to carry forward your losses if any, Also, in certain cases while applying for visas you will be asked to present your past 3 years IT return.
Income tax filing is essentially a disclosure of your income and a proof that you have paid your rightful taxes to the government.It is essential that you file your taxes since you may get some important benefits from this. 1. Where you have incurred a loss and you wish to carry forward the same to future years. For example, you may have housing loan in India. In most cases, you will have a loss under the head Income from House Property occurring due to interest on such housing loan. You can file tax return showing such loss. This loss can be utilized to offset positive income from properties in future years. 2. Similarly, you may consider filing tax return if you have incurred any capital losses on sale of shares, etc. 3. Where taxes on certain incomes are deducted at source and you wish to claim a refund of the taxes so deducted. For example, the banks may have deducted tax on interest on NRO accounts or tenant has deducted tax on rental payments, etc. 4. Where you think you would be required to submit copies of your tax returns for visa purposes or for loan purposes.
An individual is required to file his Income Tax Return for a Financial Year if his taxable income for that year was in excess of the amount of basic exemption. For, FY 2014-15 the amount of basic exemption applicable to individuals (other than resident senior citizens and resident super senior citizens) is Rs. 2,50,000, and therefore all such individuals with income more than Rs. 2,50,000 are required under the law to file their tax return. Senior citizens with annual income exceeding Rs. 3,00,000 need to file for their taxes. In case the income earned exceeds Rs. 5,00,000 then the person needs to compulsorily e-file his taxes.
There are some disadvantages of filing after due date: • You will not be able to revise your return • You cannot carry forward losses incurred under ‘Capital Gains’ or ‘Profits and Gains of Business or Profession’ • There may be additional interest and penalty levied for the delay in filing
The government offers an array of schemes in which you may invest your money and the amount invested is deductible from your taxable income as well as offer you a very good return on money invested. The various tax saving schemes that save you money and are allowed as a deduction under section 80C are 1. Provident fund 2. Voluntary provident fund 3. Life insurance premium 4. Equity linked saving scheme 5. National savings certificate 6. Mutual fund/ SIP 7. Unit linked insurance plans (ULIP) 8. Fixed deposit/ Post office time deposit schemes
You need to prepare your ITR in order to assess your actual tax liability. This amount is the actual amount due to the government in form of taxes. Refund is the amount of difference if any between the tax liability as per the ITR and the TDS deducted from your salary/receipts. You are eligible for claiming a refund from the IT department only when you file the return of income. This is also known as claiming your TDS credits from the government
ITR-V needs to be sent to Bengaluru Centralised processing Centre within 120 days of filing the return online as a proof of return filed as a part of the verification process that the ITR filing is complete. The tax department has now introduced Electronic Verification Code whereby you may electronically verify your tax returns using any one of the 4 methods given by government
You can login to the https://incometaxindiaefiling.gov.in website and provide basic details like PAN and Assessment Year to which refund relates in order to check status of refund .
Yes, provided the original return has been filed before the due date and the Department has not completed the assessment. It is expected that the mistake in the original return is of a genuine and bona fide nature and not rectification of any deliberate mistake. However, a belated return (being a return filed after the due date) cannot be revised. Return can be revised within a period of one year from the end of the relevant assessment year or before completion of the assessment whichever is earlier.
Once your tax expert has e-filed your Income tax returns, the acknowledgement ITR-V will be ready for download from your account. We will be keep the document available in your account, whenever and wherever you need it. Alternatively you may also now electronically verify your returns using the EVC – Electronic Verification Code .
Yes. You can file your taxes with us by providing us Form 16 from all the employers.
You may pay these online through a payment gateway for payment of taxes on the Income Tax website of the government. 1. Select challan 280 to pay taxes which is an option to pay Income Tax or corporation tax. 2. Select the Assessment Year for which you are paying taxes and fill in all details like PAN, Address, phone number, email address etc. Here you need to select the option Self-Assessment Tax if you are paying tax due for the FY that has just ended. 3. Here you will be re-directed to the net banking page where you need to pay tax. There are spaces for surcharge, interest and education cess that need to be kept blank. 4. On payment of tax you should receive your challan 280 that contains details of tax paid by you. Generally for salaried individuals taxes are deducted at source and hence no taxes are due on the return filing date. However, you may be liable to pay taxes when you have income from sources other than salary e.g. from house property income, income from capital gains, sale of shares, income from other sources etc. In this case you may still have to pay taxes on the income earned from these transactions. These taxes may be paid at the time of filing your return of income i.e. on or before 31st July
No, you have to file your ITR especially if you have paid the taxes. It is not an optional activity. An ITR gives the government a complete record of how your income is distributed – assets, total income, tax liability, tax paid and refunds. This helps them monitor people for tax fraud of any kind. If you fail to file ITR, you are liable to pay penalty or face scrutiny and prosecution.
yes. You’ll find a duly-filed ITR very useful as a proof of income when you have to apply for a bank loan, when you have to make accident claims in third party insurance, for immigration and visa, for appointment in judicial and class 1 jobs, for winning government tenders, for registration in professional panels, for seeking funding for a startup, etc.

Terms & Conditions

Copyright © 2016 SAHYOG.