ITR forms must be filed in order to file an income tax return in India via the official website. Individuals and salaried individuals must use separate ITR forms. Because the income tax department of India has different forms with titles ranging from ITR 1 to ITR 7. Every form fits into a specific group and serves a specific purpose.
Your income tax will not be filed on time even if you omit a single field or make any other mistakes on the form. This is where professional advice is necessary. Auditor Shiva routinely files income taxes for both private citizens and public entities. Thus, you may rely on us to electronically file your income tax return.
Documents Required for ITR Filing
If you are an employee:
- PAN card
- Form 16 provided by your employer
- Salary slip (Very essential for e filing of ITR)
If you are a business owner:
- Trading report
- Business account details
- Profit and loss statement if any
You can also submit:
- Investment proofs
- Asset purchase/sale documents
- TDS certificates provided by banks
- Interest income statement
- Receipts regarding donations mutual funds and other forms of investments.
Who Should File an Income Tax Return?
According to the Income :
- Salaried persons whose gross income before deductions under Sections 80C to 80U exceeds the exemption threshold
- Every company, whether it is a partnership, limited liability company, or private limited, is required to file an IT return, profit or loss.
- people who work as partners in a limited liability partnership company or directors in a private limited company.
- People who receive dividend payments via bonds, stocks, mutual funds, fixed deposits, interest, and other sources
- People who get money from charitable or religious trusts in addition to money from donations they voluntarily make
- Individuals and businesses seeking tax refunds
- NRIs and tech professionals
Why Should You File Income Tax Return?
There are several significant reasons why submitting an income tax return is essential. The following are reasons to file a return even if no tax is due:
- Claiming Deductions and Exemptions: Filing an income tax return will allow you to claim deductions and exemptions that are allowed by the government. These can help reduce the amount of income which is paid as tax. For example, you can deduct expenses like medical bills, education costs and home loan interest. You can also claim exemptions for any dependents you have. You can also claim dependent exemption if they meet the qualifying criteria.
- Getting a Tax Refund: If you’ve paid more taxes than you owe, when filing a tax return you can claim a refund. The excess amount will be transferred to your bank account.
- Building a Credit History: Filing your income tax return serves you another purpose. A good credit history tracks your financial habits like paying a loan or a credit card bill. Lenders check it to decide if you’re a good risk. With a strong credit history, you could qualify for loans or credit cards with lower interest rates.
- Benefits: Scholarships and schemes like the Pradhan Mantri Jan Dhan Yojana (PMJDY) – a financial services program at the national level, designed to provide basic financial services to those families who are in need, require an income tax return filing in the previous financial year to be eligible.
- Avoiding Penalties: If you didn’t submit your income tax returns, it may lead to significant penalties. It’s safe to file your income tax returns before the deadline.
- Civic Duty: The tax you pay to the government goes towards financing public programs, such as health care, education and infrastructure, which benefit all citizens in the country.
Which ITR Form to File?
There are a total of seven unique ITR forms accessible in India, with it’s own eligibility criteria and conditions. The particular ITR form you are required to file is depends upon your income, sources of income and whether you are resident of India or NRI.
Here are the different ITR forms and their eligibility criteria:
- ITR-1: If your total income is up to ₹50 lakhs and you don’t have any complicated sources of income, this form for you.
- ITR-2: If your total income is more than ₹50 lakhs, this form is for you. You need to provide more details about your income and deductions.
- ITR-3: If you have income from business or profession or have capital gains, this is the form for you.
- ITR-4: If you are a salaried and have opted for presumptive taxation scheme, this is the form for you. Under this scheme you will pay tax at 5% of your turnover.
- ITR-5: If you are a HUF (Hindu Undivided Family), this is the form for you. It’s similar to ITR-1 but you need to provide details of your members.
- ITR-6: If you are a company, this is the form for you. It’s the most complicated ITR form and you need to provide more details about your income, expenses and taxes.
- ITR-7: If you are a non-resident of India, this is the form for you. It’s similar to ITR-1 but you need to provide details of your foreign income.
If you are not sure which ITR form to file, you can always consult with a tax advisor. Here are some additional things to keep in mind when choosing an ITR form:
- The ITR form you choose must be the correct one for your income and sources of income.
- You must provide all the required information in the ITR form.
- You must sign and date the ITR form.
- You must submit the ITR form by the due date.
Penalty for Late Filing of ITR
When you file your ITR late, what you have to pay depends on how much you make and if you owe any taxes.
People who earn under ₹5 lakh need to pay ₹1,000 if they file their ITR late – For individuals with a total income of ₹5 lakh or more, the penalty for late filing of ITR is ₹5,000.
If the taxpayer has any outstanding tax liability, they will also be liable to pay interest on the outstanding tax amount. 1% interest rate per month or part of a month from the date of filing ITR to the date of payment of tax. Plus prosecution for late filing of ITR.
Here are some things to keep in mind to avoid penalties for late filing of ITR:
- File your ITR on time. The due date for filing ITR for the financial year 2023-24 is 31 July 2024.
- If you are unable to file your ITR on time, you can apply for an extension of time. The maximum extension that can be granted is three months.
- If you have any outstanding tax liability, pay it as soon as possible.
- Keep all the documents related to your income and expenses safe. You may need these documents to file your ITR.
Conclusion
Filing your income tax return (ITR) isn’t just a legal obligation; it’s a smart financial move. By choosing the right ITR form, providing accurate details, and submitting it on time, you ensure compliance and avoid penalties. Remember, it’s not just about numbers; it’s about securing your financial future.
Maximize your tax savings! Trust Auditor Shiva for seamless ITR filing. Visit our website, https://auditorshiva.com/income-tax/ or call us at +919244623455 today.
