Income Tax is an annual tax which every earning individual, corporate firms, local authority and company has to pay. And the tax depends on the annual income of a person or entity where the cycle starts from 1st April in a year and ends on 31st March of the next year.
And every individual, firm or a company should file their income tax returns for a financial year on or before the 31st of July of the next financial year. Under section 139 (1), the normal due dates for filing of income tax return is:
|Where the taxpayer is
2. Any person mandatorily required to get his tax audit done
3. A working partner of a firm whose accounts are required to be audited
|30th September of the Assessment Year|
|In case of any other category of taxpayer i.e. Salaried / self-employer who are not required to get their tax audit done||31st July of the Assessment Year|
However, if you have missed your due date for filing your income tax return, you can do so belatedly under section 139 (4).
Belated Return of Income Tax
As discussed if a taxpayer fail to file income tax returns on or before above-mentioned date under section 139 (1) can still pay it belatedly, or
If the taxpayer receives any notice under section 142 (1) from the income tax officer in case income tax return is not filed stating to file the required tax within the time specified in the notice and he has missed the due date of the notice as well can still file the income tax return. Such income tax returns which are filed after the due date are called “Belated Return”.
And one can file the belated return at any time of their convenience before the end of the relevant assessment year.
Also, ponder upon following points regarding Belated Return:
- Considerable Assessment date means the due date on which the order of assessment is passed and not on which the taxpayer has received the order
- If the return is filed after the assessment which gets cancelled, the return would still be considered as valid
- Belated return of loss from business/profession is not applicable after the normal due date
- Under the Finance Act 2016, Belated Returns filed under section 139 (4) can be revised, which is applicable from Assessment Year 2017 – 18 onwards.
- The taxpayers are required to pay interest of 1% (simple interest) per month along with tax under section 234 A in case the return is filed after the income tax due date.
What are the penalties for late filing Income Tax Return?
Late filing income tax return is subjected to penalty i.e. penalty of Rs. 5000. Although this penalty has to be paid once the taxpayer receives a notice from the income tax officer, else the penalty is not automatically levied. Hence this penalty depends on the assessment officer.
Every year at the end of the month of March, every company, organization, institution and the Government sector offices and even the employees working in the organizations etc. have so many questions revolving in their mind that- Do we need to Pay Tax? Are there any changes in the rates and schemes? Well, Taxes are mandatory. Every eligible citizen of India has to pay taxes.
What is Tax
Tax is a charge that is levied by the Central Government or the State Government of India. The tax charge is implemented for the betterment of the country’s economy and improving the standards and welfare of the country. The tax rules and the types of taxes are constituted by the Ministry of Finance’s Department of Revenue.
Different Types of Taxes in India
The Various types of taxes in India are
- Direct Taxes
- Indirect Taxes
- Other Taxes
Direct Taxes are the taxes that are directly paid or imposed to the Government of India. These taxes are controlled by the Government body, Department of Revenue named as Central Board of Direct Taxes (CBDT). The different types of direct taxes in India are
- Income Tax– Income Tax in India is levied on anybody who earns an income in India, whether they are resident and non-resident. They are classified into some categories like- individual person, Hindu Undivided Family (HUF), Association of Person (AOP), Body of Individuals, Corporate Firms, Companies, Local Authorities and another artificial jurisdictional person who have earned an income and they are eligible to pay the income tax. The Income tax is charged on the total income of the previous year at the rates prescribed for the particular assessment year. According to the assessment year of 2017-2018 the income tax rates are categorized on the basis of income slab.
The income tax rates are distributed in 5%, 10%, 20%, and 30% on the basis of the total income. A Surcharge of 10% of the income tax is added for the income between Rs 50 Lacs to 1 Crore. A surcharge of 15% is charged if the total income exceeds Rs 1 Crore.An Educational Cess of 3% is also charged in case of every individual.
For more details regarding the Income Tax rates for FY 17-18 please click here
- Capital Gains Tax– It is a tax gain on capital. If you are selling a property, bond or dealing any contract and you are gaining a profit in it, then you need to pay Capital Gains Tax. This type of tax is of two types- short term and long term. The long term Capital Gains Tax is charged if the capital assets are charged for more than 1 year in a shared case and 3 years in the case of contract whereas short term Capital Gains Tax is charged if it is less than the certain period mentioned above for the long term.
- Securities Transaction Tax– This type of tax is applicable, on the platform of stock exchange. If you are buying or selling equity shares, derivative instruments, equity oriented Mutual Funds, then the Security Transaction Tax is implemented.
The Current Security Transaction Tax Rates
|Market Type||Current Rate|
|Future and Options||0.017%|
|Capital Market (Delivery)||0.125%|
|Capital Market (Intra-Day)||0.025%|
- Wealth Tax- This tax was imposed on one individual if their net wealth exceeds 30 lacs at the rate of 1% on the amount exceeding 30 lacs. Wealth Tax is no longer leviable from assessment year 2016-17.
- Corporate Tax- Corporates are the annual or the yearly taxes that are payable on the income of the corporate organization operating in India. These are broadly classified as Domestic and Foreign Companies.
Indirect Taxes are the taxes that are not directly levied on the tax payer or the individual, but indirectly imposed on the expense incurred by the individual. Like for an example, when we buy any product, we pay GST (Previously VAT or Service Tax in case of Services). Following are the types of the indirect taxes
- Good and Services Tax (GST)– It is a type of Indirect Tax which is charged on the sale, consumption, manufacture of Goods and services at the National Level. GST was amended by the Constitution of India (122nd Amendment Bill) 2014. GST is implemented for country’s economic growth and reduce the overall tax burden on the goods in the country. The other taxes that are included in the umbrella of GST are
- Value Added Tax (VAT)– The Sales Tax is complimented with Value Added Tax to make it uniform across the country. These taxes are applied when the goods are sold completely and finally to the customer. VAT is now a part of Goods and Service Tax (GST)
- Excise Duty– Excise duty is the type of indirect tax that is levied by the Government on the goods and commodities that are manufactured in India. These goods are meant for the domestic consumption. Ex- Salt, sugar, newspapers, Tobacco, Gasoline, Alcohol etc. Excise is also a part of GST now.
- Service Tax– The Service providers are the connected to the service tax. The service tax is charged on the aggregate amount that is received by the service provider. Example- leasing, The INTERNET, transportation etc. are subjected to the service tax. Service
- Customs Duty– These are the indirect taxes that are imposed on the goods that are imposed on the goods that are exported from India and imported to India.
- Sales Tax– These taxes are imposed by the Government on the sale and purchase of the goods in the Indian Market. These are charged on the movable goods. Anything you purchase in the market, you pay sales tax for it. Examples are- telephone, salon, the advertising company, health centre etc. The last rate of the Sales tax is 14.5%. It is now replaced by GST as is the case with all above stated taxes.
GST is divided into 3 parts
- Central GST (Levied by Union Government of India)
- State GST (Levied by Various State Governments)
- Integrated GST (Levied by Union Government when there is a movement of Goods or Services across state lines.
GST Rates comprises of CGST + SGST which are equal and half of below given rates. GST Rate Slabs are given below
The GST Rates are distributed on the basis of the product category
|GST (0%)||Milk, jaggery, fresh vegetables, unbranded honey and paneer, coconut water, prasad, salt|
|GST (5%)||Kerosene, Coal, tea, spectacles, cashew nuts, mat flooring, raisin, LPG, Footwear (<Rs 500), Apparels (<Rs 1000).|
|GST (12%)||Butter, ghee, almonds, umbrellas, mobiles, packed coconut water, preparations of vegetables, fruits like (Chutney, Jam, Jelly, Pickle)|
|GST (18%)||Hair Oil, toothpaste, computers, CCTV, cornflakes, staplers, ice cream, computer monitor (<17 inches), printers.|
|GST (28%)||Luxury Products, Betting, Horse Racing, 5 Star Hotels, Cinema Tickets etc.|
- For the restaurants serving alcohol, the tax charged will be 18%.
- Education, Healthcare are going to be exempted from GST.
- GST charges on the services on Non-AC Restaurants will be 12%.
- GST on Gold and Jewelery will be 3%
- GST on Diamond and Precious Stones will be 0.25%
- Petroleum Products and Liquor is not a part of GST regime and is still under the VAT and Excise Model.
Other Indirect Taxes
- Professional Tax– It is the tax that is charged on the income on the basis of the profession or employment. An individual earning an income or anyone holding a profession such as a lawyer, doctor, interior or fashion designer etc.
- Municipal Tax– This tax is imposed by the local authority called as Municipality of the country. These are the local taxes that are paid to the Municipal Corporation if he or she owes a house property. These taxes are paid for the maintenance of sewage, road, civic services.
- Entertainment Tax– This tax is imposed by the State Government on the financial transaction that is related to the Entertainment. These taxes are imposed on the movie tickets, stage/ theater shows, broadcasting, DTH and cable services. This tax is no longer active and covered under the umbrella of GST from July 1st, 2017 Onwards.
- Stamp Duty, Registration Fees, Transfer Tax– When you are purchasing a property then you have to pay additional charges like the stamp duty, registration fees, transfer tax etc. This tax is levied by the Government for preparing the legal documents of the property. This is the tax is imposed over the handling of the title of the property ownership from one person to another. The amount varies from property to property.
- Education Cess and Surcharge– The Education Cess is divided into two types – Primary Education Cess and Higher Secondary Education Cess. This tax is levied by the Government to improve the education quality in the public schools and colleges. It comprises of the 3% of the income tax. The Cess charges are also included under the GST family structure. Whereas, the surcharge is an extra charge that is clubbed to your existing tax calculation. This tax is applied on the tax amount.
- Gift Tax– If you receive the gift from someone, it is merged with your income and you need to pay tax on it. This tax is called Gift Tax. This tax is applicable if the amount is more than Rs 50,000/- in a year.
- Swachh Bharat Cess – This tax is recently imposed by the Government. The tax is applicable to all the taxable services from 15th November 2015. The effective rate of Swachh Bharat Cess is 0.5%. Swachh Bharat Cess is abolished after the introduction of GST.
- Krishi Kalyan Cess– This tax is levied for the welfare of the farmers. The effective rate of the Krishi Kalyan Cess is 0.5%. This tax came into effect in the year June 1st, 2016. Krishi Kalyan Cess has been abolished after introduction of GST
- Entry Tax– This tax is levied or charged on the goods that are bought within the state or from outside the state. Entry Tax is separately charged by the State Government of India. This tax is also known as the Octroi Tax. Octroi is no longer levied after the introduction of GST.
Some other forms of taxes are
- Dividend tax
- Infrastructure tax
- Property tax
- Luxury tax
- Toll tax.
The above Cess mentioned like -Swachh Bharat Cess, Krishi Kalyan Cess and the Entry Tax are no longer active now and they are clubbed with GST.
Latest Update- The latest report on tax says that after the introduction of the GST all the indirect taxes are merged under GST. So, the above taxes are removed due to the arrival of GST in the queue of Taxes. So, the taxes are reduced from number 25 to 10.
Income Tax Return is the income tax return which you need to file when you have income, depending on the slab range stated by the Government of India. It stores the complete data about the incomes and the investment of a person in a certain fiscal year. For filing an ITR online you need to e-file it online.
What is an e-filing?
The process of electronically filing the income tax return using the internet is known as e-filing. It is a mandatory process for all the companies and firms and individuals requiring the statutory audit and submits the income tax return for the Annual Year 2017-18. The e-filing procedure is possible with or without the digital signature.
Filing an income tax return online can help the person fill all the following relevant information online and can submit the form online itself.
This step by step guide will help you file your ITR quite easily
- Gather All the Information and Documents
Before starting filing an income tax return, make sure you keep all your documents, papers and identity card information ready. This will shorten out your time and will not keep you in a mess. The documents that you need while filing an ITR are
- PAN Card- Permanent Accountant Number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department. A typical PAN is AABPS1205E.
- Form 16 received from your employer- Form 16 is only applicable for the service employers. If you are a salaried person and your employer has deducted TDS on your salary, then he/she will issue you a Form 16. Form 16 shows the salary earned by an employee during the year, deductions and tax deducted or TDS on your salary during the year. This is known as the TDS Certificate.
- Form 16A received from Banks- It is the TDS Certificate showing the tax deducted at source by other deductions such as the bank’s other institutions on the interest/commission that you have earned this year.
- Form 26AS- It is the tax deducted and deposited on your behalf by your deductors. It is provided by the Income Tax Department. It shows you the total tax paid against the PAN during a financial year. you can download this form by logging in to your Income Tax E-filing Account.
- All Your Bank Statements
- Property Details
- Home Loan Certificates
- Business/Professional Income Details
- Self-Assessment Challan/ Advance Tax Challan
- Investment Proofs
- Now visit the e-filing website – www.incometaxindiaefiling.gov.in
- If you are a first-time user and you are filing it for the first time then click on the “New Registration tab” and register yourself by providing the relevant information about yourself and create your personal username and password. Make sure that when you are creating your user-id you must have your e-mail id and mobile number active.
- After the registration, an active link is provided. After clicking on the activation link, you are given a one-time password (OTP), where you have provided the OTP which has been sent to your mobile number.
- Click on the registered user if you have registered yourself already on the website. If you have any issues or problem related to the registration process you can contact the customer helpline number.
- Now click on the login tab and provide the required details like- your User ID, your PAN details, date of birth, and the captcha code was given. Then click on the login button to get signed in.
- After logging in, your account dashboard appears on the screen. Click on the “e-file tab” and select “Prepare and submit ITR online” option.
- Now select the relevant form and the assessment year for which the ITR must be filed. Here the taxpayer can fill in the address from the PAN database or add a new address. Here the income tax department asks you whether you want to digitally sign your return. If you select the “Yes” option then you need to upload your digital signature which needs to be pre-registered at the income tax official website.
- Now click on the submit button, and the website will redirect you to the page for filling to the form selected by you. Before starting e-filing the ITR form, one should read the General Instructions given at the start of the form.
- After that, you will be given to fill in the required information in different tabs, like the General Information, Income Details, Tax details, taxes paid in the ITR form. Make sure the tax payable shown in the online form matches the information and calculations given by you.
- Before submitting final, you need to save the data you have provided earlier and recheck it to avoid any mistakes. Once “Preview and Submit button is chosen your form will appear on the screen allowing you a preview of your ITR form before the final submission is made.
- Once the submit button is clicked your ITR will be uploaded and you will be asked to verify your return using any of the options available.
- If you have already added your digital signature, you will be asked to upload the same signature while submitting your ITR at the final step. Once it is upload and the final submission is made then your ITR filing process is completed and no further verification is required. You don’t have to send an acknowledgment/ITR-V to the CPC Bangalore.
- If you haven’t uploaded any digital signature while filing an ITR then you can verify your return either electronically using Aadhaar OTP or by sending a signed-printout of the ITR-V sent to CPC Bangalore within 120 days from the date of e-filing.
- An acknowledgment/ITR-V is sent on your registered e-mail ID once you have successfully uploaded. This acknowledgment pops out on your account on the e-filing website from where you can download if it is required.
- Now the department will process your ITR once you verify it. After your ITR is processed you will be intimated about the email via email and SMS on your registered mobile number.
So, you can now easily file your Income Tax Return (ITR) without any complication.
provide links to previous income tax post once published.
Pension is a form of income which a person gets in his retirement, which comes in every working individual’s life. It is also a stage in life where people get apprehensive about their finances due to lack of regular pay checks. And people get conscious about their lifestyle and worry about their expenses.
At such a time, pension plans ensures that you continue receiving regular income after your retirement, once the regular work pay checks cease. In India, government offers many pension schemes to inculcate savings habit in people, so that they can retire gracefully.
Income Tax Rules for Pensioners
Pension is a compensation offered by the past employer and employee for offering their service in the organization. Also note that, pension paid is based on a previous agreement of service and not on agreement for services. And as per the, Section 60 of the CPC and section 11 of the Pension Act, pension is an allowance or stipend given to a person for providing his service to the past organization which comes to an end upon the death of an employer. Hence, if a pensioner is getting their pension from a nationalised bank, a pensioner will get several deductions on salary income such as under section 89 (1). Also during tax deduction at source from the pension, adjustment will be done in terms of tax rebate under section 88 and 88 B.
Income Tax Form for Pensioners
Let us discuss the income tax form which is required for pensioners.
Form No. ITR 1 – Also known as Sahaj and is filed by the assessee. And this form is meant for the individuals whose source of income is salary and not for any business enterprises.
Also, pensioners can file their income tax returns by filling this form. This form is used by majority of salaried taxpayers who own one house and have their income which is taxable (Income from other sources) in addition to their pension.
Method of Filing Form No ITR 1
Fill in the correct details and follow the below mentioned procedure:
- Part A – In part A, the applicants are required to fill their personal details such as his name, birth date, email id and other related information.
- Part B – In part B, the applicants are required to fill their Gross Total Income i.e. the salary from income.
- Part C – In part C of the form, the applicants has to furnish his deductions as provided in Form 16 and total taxable income.
- Now applicants are required to provide details pertaining in their operational bank account along with IFSC code and the branch and bank code of the same.
- Now, verification of the details so furnished has to be done.
- Also the applicants have to furnish details related to advance tax as well as payments made towards self-assessment tax in the part mentioned as Schedule IT.
- Applicants are also required to furnish details related to TDS (Tax Deduction at Source) from salary, under the part mentioned as Schedule TDSI.
- Under the part mentioned as Schedule TDS2, the applicant has to furnish details related to TDS having income sources other than salary.
Method of Tax Calculation for Pensioners
Generally pension is calculated through one’s income earned through salary under the head of salary in one’s ITR form. Pension is either paid in a monthly or as a lump sum amount and is known as commuted pension, whereas, pensions paid on a periodical basis is known as un – commuted pension and is liable to be 100% taxed.
- Commuted pension is received by the family of the tax payer, which is a lump sum payment and may be exempted from tax under the head income from other sources.
- And un – commuted pension is received by the family of the tax payer, however, subjected to a minimum of Rs. 15,000 or 1 / 3rd of the total pension amount is exempted from tax.
- Also, in case of sudden death of the employee, family pension is given on a monthly basis to a family member of an employee by his employer.
How much tax do I pay on my Pension?
In case the income of an individual exceeds the exemption limit, that individual is required to file income tax returns. And the pension income from an employer is taxed as salary income while interest on various investments is taxed as income from other sources. However, when it comes to PPF (Public Provident Fund), the interest income will be tax exempted. In case of your taxable income is above the exemption limit, that individual is required to file their Income Tax Returns.
Filing an Income Tax Return by Post is quite easy just like a child’s play. You just need to get a form printed out which will take a few seconds and then post it to the required Income Tax Office Address which is located in Bangalore. Let us know the complete details about the process of Filling ITR offline by Post.
An Income Tax Return is the type of tax-form which is used to file income tax with the Income Tax Department. The Tax Return is usually a predefined worksheet formula with the income figures which are used to calculate the tax liability in the documents.
The Law states that the tax must be filled every year for an individual or business that received income during the year, whether through the regular income/wages, dividends, interests, capital gains or other sources.
Tax Return, regardless of whether it relates to an individual or a business, must be filled by a specific date. If the return shows that an excess amount of tax has been paid during a given year the assesse is eligible for a “Tax Refund”, subject to the departments, interpretations, and calculations.
How to fill ITR Offline by Post
For sending the ITR file through speed post a unique Pin Code (560500) is introduced and allocated to the Centralized Processing Center (CPC), Income Tax Department located in Bengaluru.
Steps from filling up the form offline to Posting and Sending It to CPC Bangalore.
Step 1. Visit the official website of the Income Tax Department. Download the ITR-V form the website.
Step 2. If you have downloaded the ITR-V form then you require a password to open it.
Password Format to Open ITR-V
The Password is your PAN Number in lower case letter along with the date of birth.
Date of Birth- 01/01/1982
After receiving the ITR-V (acknowledgment) you need to send it to the CPC, Bangalore within a time period of 120 days of e-filling your income-tax return.
An ITR-V form is called Income Tax Return- Verification form. It is basically a one-page document. It is received only when you file your IT Return Online without using a digital signature. This document is sent by the IT Department. Then the IT Department verifies the authenticity of your e-filing which does not have your digital signature. On the receipt of a form of ITR-V, you need to sign the copy of the form in blue ink.
Step-3. Send the form to the following address
Address of CPC Bangalore, for Speed Post:
Post Bag No. 1
Electronic City Post Office
This will take a period of 3-4 days to receive the documents. After receiving the documents, the CPC Bangalore sends an email acknowledgment on the receipt of ITR-V. It takes a minimum of 4-5 days.
You can check your status on the https://incometaxindiaefiling.gov.in/
if your ITR-V has not been marked as received after 10 years you can call on the Government Helpline Number 1800 4250 0025 / +91 80 2650 0025 from 9 am- 8 pm.