Income Tax Return (ITR) is a structure that an individual should submit to the Income Tax Department of India as per the provisions laid out in the Income tax act, 1961. It contains data about the individual’s income and the taxes to be paid on it during the year.
The Income Tax department has classified Income sources and entities in a way that there are 7 different ITR forms (ITR 1 to ITR 7), however only one applies to one person.
In This Blog:
- Eligibility Criteria to File ITR Mandatorily?
- Who is Eligible to File Returns Under ITR-1?
- Who is Not Eligible to File Returns Under ITR-1?
- How to File ITR-1?
- Prerequisites and Documents Required to File ITR-1
- Stepwise Filing ITR-1 Online
- Due Dates of Filing ITR 1 for AY 2022-2023
- Consequences of Not Filing ITR-1 in Due Time
ELIGIBILITY CRITERIA TO FILE ITR MANDATORILY?
While anyone can file their ITR, the Income Tax Act mandates taxpayers of specific classifications to file ITR within the stipulated due dates. The following are the ITR filing rules for taxpayers in India:
- If your gross absolute income (before permitting any deductions under Section 80C to 80U) surpasses Rs 2.5 lakh in the financial year, then it is mandatory to file ITR. This breaking point is Rs 3 lakh for senior residents (aged over 60 yet under 80) and Rs 5 lakh for very senior residents (aged over 80).
- Companies/firms are mandatorily required to file ITRs irrespective of their profits and losses incurred during the financial year.
- The amount deposited, or the aggregate of the amount is plus Rs 1 crore in one or more current accounts maintained with a bank or a co-operative bank.
- Aggregate expenditure incurred is more than Rs 2 lakh for self or any other person traveling to a foreign country.
- If any aggregate expenditure incurred towards the payment of electricity bill is over Rs. 1 lakh.
The relevance of ITR structures changes relying upon the kinds of revenue of the taxpayer, how much the income acquired, and the classification the taxpayer has a place with like people, HUF, organization, and so on. One necessity to painstakingly learn the proper ITR structure for recording, remembering the various details of income as well as the different exposure prerequisites recommended from time to time.
Appropriateness of various ITR Forms?
WHO IS NOT ELIGIBLE TO FILE RETURNS UNDER ITR-1?
- Any individual who is earning an income of more than 50 lakhs.
- Individuals having income from business or profession.
- Individuals have an income from more than one house property.
- Income received from gambling like lotteries (including legal gambling).
- Income received from taxable capital gains either long-term or short-term.
- Income exceeding 5000 from agriculture.
- Individual who is a Resident and has assets (remembering financial interest for any substance) outside India.
- Any individual claiming relief from double taxation or foreign tax paid under section 90/90A/91 is not eligible to file under this form.
HOW TO FILE ITR-1?
- ITR-1 can be filed either through Online mode or Offline.
- While using Online mode, one can prepare their return online on the Income-tax web portal.
- In the Offline mode, you should download the Income-tax offline utility or should use third-party software to prepare your returns in JSON format. Then the JSON can then be uploaded to the Income Tax portal. Any person aged above 80years can file the returns in paper form at any point time during the previous year.
PREREQUISITES AND DOCUMENTS REQUIRED TO FILE ITR-1
- To avail of this service, the PAN card needs to be active.
- PAN and Aadhaar cards should be linked.
- User should be registered on the e-filing portal with a valid username and password.
- It is recommended that you should nominate and pre-validate at least one bank account for refunds.
- For e-verification, a valid number should be linked with your bank account/ adhaar, e-filing portal/NSDL/CDSL.
- Form 26AS (Annual consolidated statement) contains all the information comprising TDS, advance tax, etc.
- Form 16 contains all the information about the tax deducted from the latter’s salary and submitted to the IT department.
- Investment proof for tax saving: Employees who couldn’t outfit their genuine tax-saving investment proofs to their HR/Accounts department in the past financial year, can declare their investments on the portal itself to claim tax deductions.
Note that the Income Tax return in itself is a self-declaration and no proofs are required to be submitted at the time of claiming deductions. While post submission of the return, at the time of assessment the Income Tax department can ask for your investment proofs like receipt of medical insurance, the receipt for LIC premium paid, receipt of donation paid, receipt of tuition paid, the receipt for investment in Public Provident Fund (PPF), mutual funds’ investments, FD receipts and so on.
- Receipts: If you have not had the option to submit confirmation of specific exceptions or deductions, (for example, HRA allowance or Section 80C or 80D deductions) to your employer on time, keep these receipts convenient to guarantee them on your income tax return straightforwardly.
- Bank passbooks or FDs to determine interest from the bank.
STEPWISE FILING ITR-1 ONLINE
The online ITR-1 form contains seven tabs:
- General Instructions
- Part – A General Information containing the following heads: Name, Address, PAN number, Mobile no., Email address, Aadhar number, Nature of employment viz Govt/PSU/Pensioners/Other
- Part – B Gross total Income includes the details of Employer like TAN, Name, Nature& Address of Employer, Salary details, allowances which are exempted, the value of perquisites, Net salary, Deduction in u/s 16, Income chargeable under the head ‘salaries’
- Part – B2 covers the amount of gross Rent received, Tax payment to local authorities, Annual value, Interest payment on borrowed capital, unrealized rent less than 30%, Income chargeable under head ‘house property’.
- Part – B3 includes Income from Other Sources fewer Deductions u/s 57(iia) less Income Claimed for relief from taxation u/a 89A
- Part – B4 Gross total income (B1 + B2 + B3)
- Part – C This tab incorporates all the deductions and taxable total income
- Part – D This tab incorporates all the valuation of tax payable
- Part – E contains other information like bank details, account number, account holder name,
- Schedule – IT requires details of advance tax and self-assessment tax payments
- Schedule – TDS details of TDS/TCS
- Verification: Verification can be done Electronically through Adhaar OTP/ Digital Signature/ Net-Banking/ Demat.
If you are going for Offline Verification, you need choose the option on the portal and send the physically signed ITR-V acknowledgement to CPC, Bengaluru. It is feasible to download the structure physically, sign it, and post it to the Department’s Central Processing Center (CPC) office inside a time of 120 days of e-recording the structure.
On the off chance that you present the structure electronically by utilizing an advanced mark, you will get the affirmation on your email ID.
You can stepwise learn how to file ITR-1 from the online user manual provided by the income tax department on the following link:
DUE DATES OF FILING ITR-1 FOR AY2022-2023
The due date to file ITR-1 for AY 2022-2023 is July 31st, 2022. You should file your ITR post 31st May 2022, as it is the last date to file a TDS return after which taxpayer’s 26AS forms will get updated. Recruiters won’t be able to provide their employees with Form 16 before the filing of TDS for the employees whose TDS has been deducted in Q4 FY22.
So, according to experts, earning individuals are advised to wait till June 2022. One should not hurry in filing returns and should keep checking form 26AS as it takes time to get updated. Therefore, after logging into the income tax website, one should check form 26AS and then proceed to file ITR for AY-22-23.
CONSEQUENCES FOR NOT FILING ITR-1 IN DUE TIME
After the insertion of section 234F in the income tax act, effective from FY 2017-18, a late filing charge will be material for filing your returns after the due date under Section 234F.
For example, the due date for filing returns for FY 2021-22 is 31st July 2022. If you miss filing ITR by the due date, you can file the belated return by 31st December 2022. Nonetheless, you are expected to suffer the consequence of late filing.
The greatest punishment of Rs 5,000 will be required assuming you file your ITR after the due date of 31st July 2022 however before 31st December 2022.
Notwithstanding, there is a help given to small taxpayers – if their all-out pay doesn’t surpass Rs 5 lakhs, the greatest penalty levied will be Rs 1,000.
FREQUENTLY ASKED QUESTIONS
How do I figure out which ITR I need to file?
Different tax returns are recommended for filing by individual citizens relying upon their kind of revenue and private status. You can refer to our blog to determine the Return applicable for you: https://tobewrittenbyshefali/
- What precautions should I need to take while filing the return of income?
- Track your details like PAN, permanent address, contact details, bank account details, and so forth are right in the pre-filled information.
- No document should be attached with ITR-1 but you should keep handy all the documents with you in case you need to present them during verification.
- You should identify the correct ITR for you to be filled i.e. ITR-1 to ITR-7. You should provide all the details like total income, deductions, interest, taxes collected or paid if any.
- Once you have e-filed, e-verify the return to ensure its correctness. If you want to manually verify your return, send a signed physical copy of ITR-V to CPC, Bengaluru within 120days.
- For transparency, download the 26AS form to check TDS and TCS or tax paid if any. If any issue arises, you can confirm it with your employer/tax deductor/bank.
- Carefully go through the documents required while filling the form like your bank passbooks, investment evidence, interest certificates, receipts to claim deductions or exemptions, contents of form 16 and form 26AS, etc.
- File the returns before the due date as the delay can charge you late filing fees, losses not getting forward, and other deductions and exemptions not available.
- If I have selected a new regime in the last year can I switch to the Old regime or vice versa?
A person earning income from salary and having no income from Business and profession can pick between the old and new tax regimes every year by filing 101E every year to select the new tax regime.
An individual having income from business can switch tax regimes twice in his entire lifetime. First, to select a new tax regime and the second to select the old tax regime again.
NOTE: Income of Consultants and Freelancers are charged under profits and gains from business/ profession and thus, such individuals are not eligible to change their tax regimes every year.
- My Income is over Rs.50 Lakhs, can I file ITR -1?
No ITR-1 cannot be filed in this case, you should file ITR-2.
- Few common terms to understand.
An income tax assessee is an individual who pays tax or any amount of cash under the provisions of the Income Tax Act, 1961. The term ‘assessee’ covers every individual who has been assessed for his income, the income of someone else for which he is assessable, or the profit or loss he has sustained.
- Assessment year
The assessment year is the year that comes just after the financial year (FY). Both financial year (FY) and assessment year (AY) begins on the first of April and finishes on the 31st of March. The assessment year is the period where income acquired during a specific financial year is taxed and evaluated. For instance, thinking about the ongoing situation; for the period 1st April 2020 to 31st March 2021, the assessment year will be the following one that is from first April 2021 to 31st March 2022.
- Advance Tax
Advance tax is how much income tax ought to be paid in advance rather than a single amount installment at the year-end in portions according to the due dates given by the income tax division. Advance tax is otherwise called ‘pay as you earn’ tax and should be paid around the same time the income is received.
- Self-Assessment Tax
Self-assessment tax alludes to any balance tax that must be paid by an assessee on his assessed income after the TDS and advance tax have been considered before filing the return of income. The IT return can’t be submitted to the IT Department till the time the taxes have been paid. Toward the year’s end, assuming there is any tax that is forthcoming before filing the ITR there is a final amount that must be determined.
To lay it out plainly, Self-Assessment Tax is the balance tax that an assessee pays on the income that has been assessed, solely after taking into consideration the TDS as well as advance tax before the person files the returns of his income.
Tax deduction alludes to claims made to diminish your taxable income, emerging from different investments and costs caused by a taxpayer. Subsequently, income tax deduction lessens your general tax liability. It is a sort of tax benefit which assists you with saving tax. In any case, how much tax you can save relies upon the kind of tax benefit you claim.
Returns are filed to detail and report to the government regarding the income earned during the year. There are three types of returns: Original, revised, and belated.
- Original Return vs. Revised Return
|Original return||Revised return|
|Assuming a filer records an income tax return for the first time for the financial year, it is called an original return.||On the off chance that any alteration is expected in the original return, a filer needs to record a revised return.|
- Can I revise ITR-1 if I have filed already?
As per section 139(5) of the income tax act, any taxpayer can file a revised return if he discovers any wrong or omission in the return filed at any time before the end of the relevant assessment year or before the assessment order passed by the Income Tax Department, whichever is earlier.
Whoever has filed a belated tax return that is returns filed after the due date can also file a revised tax return.
- There is no tax payable for me, should I still file my returns?
It is a most common understanding that if you are earning below 2.5lakhs then you do not have to file an income tax return. This is a total misunderstanding, instead of filing ITR even showing your taxable income as 0 can benefit you in long run. Following are the benefits that can be derived from filing ITR:
- For taking loans. As all the banks ask for a copy of tax returns with other documents.
- If you want to claim refunds from the Income-tax department, filing returns is important.
- Carry Forward Losses: The upside of filing ITR is that you can carry forward capital losses to eight progressive years promptly following your losses (in that specific year.) This way, every time you have capital gains, you can adjust the sum, and you will not need to pay taxes in the year you had capital losses. Without filing ITR, losses cannot be taken forward.
- Visa processing: During interviews for your visa, unfamiliar offices confirm your ITR receipts from the most recent few years. By showing ITR receipts, you affirm that you have an authentic type of revenue in India and are not intending to leave the country for good. In this way, while going to outside nations, specialists recommend that one must constantly convey ITR receipts.
- Is putting in bank details mandatory?
To process your refunds, the income tax department requires at least one bank account. Therefore, the income tax department has made it mandatory for all the citizens to report all the bank accounts they possess which also includes joint accounts.
- Do I need to attach proof for the deductions that I am claiming?
No, you do not need to attach any proofs for the deductions you are filing with returns. However, we suggest you keep those securely, in case you get an Income Tax notice, and the Assessing Officer calls for them. You should hold these verifications for 6years.
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