Income Tax Return (ITR) is a form which a person is supposed to submit to the Income Tax Department of India. It contains information about the person’s income and the taxes to be paid on it during the year. Information filed in ITR should pertain to a particular financial year, i.e., starting on 1st April and ending on 31st March of the next year.
The tax liability of a taxpayer is calculated based on his or her income. In case the return shows that excess tax has been paid during a year, then the individual will be eligible to receive an income tax refund from the Income Tax Department.
Tax returns have to be filed by an individual or a business before a specified date. If a taxpayer fails to abide by the deadline, he or she has to pay a penalty along with Interest.
Following Five head of Income are there in Income Tax Return Form
Income from Salary
Income from Business and Profession
Income from House Property
Income from Capital Gains
Income from Other Sources
The correct filling under the head of the particular type of Income is essential for correct filling of Income Tax Return.
The Income Tax Return to be filed by all the individuals, up to the age of 59, whose total income for a financial year exceeds Rs 2.5 lakh. For senior citizens (aged 60-79), the limit increases to Rs. 3 lakh and for super senior citizens (aged 80 and above) the limit is Rs. 5 lakhs. It is important to note that the income amount should be calculated before factoring in the deductions allowed under Sections 80C to 80U and other exemptions under section 10.
All the HUF if their Income is above the Taxable Income i.e., 2.5 Lakh rupees during the Financial Year,
All the registered companies, Partnership firms, LLP, Societies, trust that generate income, regardless of whether they've made any profit or not through the year.
Those who wish to claim a refund on the excess tax deducted/income tax they've paid.
Individuals who have assets or financial interest entities that are located outside India.
Foreign companies that enjoy treaty benefits on transactions made in India.
NRIs who earn or accrue more than Rs. 2.5 lakh in India in a single financial year.
Apart from the reporting of the Income under the correct head of Income, there are 7 types of Income Tax Return form and correct form have to be filed along with correct head of Income.
The Taxable Income and the Income Tax Slab is notified by the government in the annual budgets and accordingly the Income Tax is applicable.
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