What is Income Tax?

Income tax is tax levied on the income of a person by the Government of India as per the provisions contained in the Income Tax Act 1961.

It is levied on income earned during the Financial year starting from 1 April and ending 31st march.

What is Income Tax Return?

It is a statement of your earnings from various sources of income, tax liability thereon, details of tax paid and any refunds that have to be given by the government.

What is Taxable Income?

Taxable income is the amount of income used to calculate an individual’s or a company’s income tax due (excluding exemptions). Taxable income is generally described as gross income or adjusted gross income minus any deductions allowed in that tax year.

Taxable income includes:-

• Income from Salary.
• Income form House Property.
• Income from Business/ Profession.
• Income from Capital Gain.
• Income from Other sources.(like Interest Income, Dividend Income, Speculative Income.

Who is Required to file Income Tax Return?

Any person whose income exceeds the basic exemption limit as specified in the Income Tax Act,1961 is required to file an Income Tax Return.

Now, the basic exemption limit changes from year to year.

At present the limits are:-

• Rs. 2,50,000 for individuals of less than 60 age,
• Rs. 3,00,000 for individuals in the age bracket of 60-80 years, and
• Rs. 5,00,000 for individuals of more than 80 age.

It is compulsory to file an income tax return if any of the condition is applicable to

(i) If you’re taxable income is more than slabs notified in Finance Act for that Year. Example for an Individual Resident below 60 years of Age the Slab is 2,50,000 /-(A.Y. 2017-2018) and for senior citizen it is 3,00,000. Thus if his income is more than 2,50,000/- ( or 3,00,000 in case of senior citizen) then it is mandatory for him to file Income tax Return irrespective of whether you have no Tax Liability.

(ii) If you are entity registered as a firm or a company irrespective of the income or loss during the year.

(iii) If you have losses under any head and want to carry forward those losses to next year.

(iv) If you want to claim refund of taxes already paid i.e. TDS etc.

(v) From 2012 onward resident individual holding any kind of Foreign Asset e.g. Immovable property, bank account etc. or is a signing authority in a foreign bank account then he is compulsorily required to file the return.

Type of Income Tax Return

• For Individuals/HUF: ITR-1, ITR-2A, ITR-2, ITR-3, ITR-4S, and ITR-4
• For Company: ITR-6
• ITR-7 is a form filed by those individuals and companies that fall under the following sections:
  Section 139 (4A)
  Section 139 (4B)
  Section 139 (4C)
  Section 139 (4D)
• For Other than Individuals and Company: ITR-5
  1.  ITR-1 SAHAJ-For individuals having income from salaries, one house property, other sources.
  2.  ITR-2A–For individuals and HUF not having income from business or Profession and capital gain and who do not hold foreign assets.
  3.  ITR-2–for individuals and HUF not having income from business or profession.
  4. ITR-3–The ITR -3 form is designed for the individuals who runs partnership firm or LLP.
  5.  ITR-4S–ITR-4S Presumptive business income tax return.
  6.  ITR-4–for individuals and HUF having income from a proprietary business or profession.
  7.  ITR-5–For persons other than- Individual, HUF. Company and, persons filing ITR-7.
  8. ITR-6– For companies except those companies or organizations that claim tax exemption as per Section 11.
  9. ITR-7– For persons including companies required to furnish return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D) or section 139(4E).
  10.  ITR-8– For Individuals who have no any income but only has Fringe Benefits.

What are the Due Dates for Filing Income Tax?