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Income Tax Return Filing in India: What you need to know?

• Posted by Ezybiz India May 3, 2022 Filed in Business #Income Tax Return  15 views
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  Income Tax Return

   

  The Financial year 2021-22 has just ended and now the due date for filing Income Tax return for FY 2021-22 is fast approaching.

   

  Income tax return filing in India is an annual exercise which every tax payers need to do as per his or her legal as well as moral duties.

   

  Every year, Central Board of Direct Taxes notifies Income Tax Return filing forms for different categories of tax payers. For FY 2021-22 also, the CBDT has notified the relevant forms. There are total 7 forms prescribed depending upon the types of assessee. It is very important for the assessee to choose the correct Income Tax return form as filing return in wrong form may lead to the tax return filing being invalid.

   

  Compulsory filing of Income Tax Return in India

   

  There are 2 criteria for compulsory filing of Income Tax Return. Fist is financial criteria and second is non financial criteria. Every assessee needs to file their Income tax return in India in case their total income during a financial year exceeds basic exemption limit of Rs.2.5 lac.

   

  Similarly, there are non-financial criteria which means that income tax filing needs to be done even if there is no taxable income however, the assessee has done some transactions like foreign travel, made electricity bill payment of more than Rs.1 lac, have turnover form trading of goods of more than Rs.60 lac or turnover from profession is more than Rs.10 lac etc.

   

  What are the Due Dates of filing Income Tax Return

   

  In case of individual and HUF assessee, due date of filing tax return is 31^st July

  In case of companies, due date is 30^th September

  In case of proprietorship subject to tax audit, due date is 30^th September

  In case of assessee to which transfer pricing provisions are applicable, due date is 30^th November

   

  What is the process or steps involved in filing Income Tax Return?

   

  Following steps are involved in filing Income tax return in India:

   

  1. Computation of tax liability under 5 heads of income
  2. Providing deduction u/s 80C from gross total income to arrive at total income
  3. Computation of final taxable income and tax liability after deducting advance tax and TDS already paid and calculation of any interest payable under the Act.
  4. Payment of final tax liability through self-assessment challan 280
  5. Filing of Income Tax Return
  6. E verification of Income tax return- This is the most crucial step after Income Tax return filing as without proper verification of the return, it will be considered as invalid return.

   

  Some other points which shall be kept in mind at the time of Income Tax return filing in India

   

  Following points shall be kept in mind at the time of Income Tax Return Filing in India:

   

  • Late filing of Income tax return would attract interest u/s 234A in case there is tax liability
  • Nonpayment of advance tax within time would attract interest u/s 234B and 234C
  • Late filing of Income Tax return would also lead to penalty of Rs.1000 to Rs.10,000 depending upon case to case basis.
  • In case tax return is filed late, any brought forward loss cannot be carried forward.

   

  From the above, it may be inferred that Income Tax Return filing in India is a complex procedure and requires expertise of tax consultant/tax advisors.

   

  In case you need any further clarification or assistance, please contact www.ezybizindia.in or call at +919899217778