Filing of Income tax Return

Who is required to file Income tax Return?

It is compulsory to file returns of income for companies and firms. In case of individuals and HUFs, if the total income before claim of eligible deductions is more than Rs. 2,50,000/- you are required to file  Income tax return. Such limit is Rs.3,00,000/- for persons between the age of 60 years and 80 years and Rs.5,00,000/- above the age of 80 years. The Income tax return is filed under section 139(1) of the Income tax Act.

E-Filing of Income tax returns

If you are NOT an 80- year old person with total income less than Rs.500,000/- and no refund claim in the ITR, you are required to file income tax returns. Assessment Year 2015-16 onward, manual filing of ITR has been discontinued and given way for electronic filing. However, no digital signature is necessary to e-file the return except in cases where there is a business income return with a compulsory tax audit.The e-filing of returns is very beneficial for the taxpayers since the entire record of income tax returns for every individual is accessible at any point of time. Further there are certain advantages:

  • Faster processing of ITR and speedy issue of refunds
  • Viewing the tax credit status online (Form 26AS)
  • Tracking of refunds live
  • Receiving SMS and email alerts about various due dates and important matters

Due dates for filing income tax returns

Category of taxpayers Due Date for Income Tax Return
Individuals, HUF, BOI, AOP. (Taxpayers with no audit requirement.) 31st July of the relevant Assessment Year
Company, Taxpayers whose accounts need to be Audited, Working partner (whose firm’s books need to be Audited) 30th September of the relevant Assessment Year

The income tax return must be filed within the due date

The income tax return must be filed within due date. This is rewarded with following benefits:

  • You can revise your return of income.
  • You can claim the carry forward and set off of losses under business and capital gains.
  • There are certain deductions which are available only when return is filed within the due date.
  • There are certain exemptions which are available when the return is filed within the due date.
  • You can avoid additional interest under section 234A of the Income tax Act.
  • You can avoid the late filing fees which is minimum of Rs.5000/- and maximum of Rs.10000/-.

 

Late fee for delayed returns

From Assessment Year 2018-19 (financial year 2017-18), if the return is filed beyond the due date, a late fee of Rs.5000/- to Rs.10000/- is payable. The fee is charged as per section 234F of the Income tax Act. The default and amount of late fee for A Y 2018-19 is as under:

 

The late fee explained

Different ITR forms

The Income tax returns are to be filed in a specific format prescribed by the Central Government (Central Board of Direct Taxes, CBDT). Such forms are called ITR forms and are published by the CBDT in the months before the start of the filing season every year. These forms are designed to capture specific information in cases of specific kinds of income to be declared by the taxpayer. Hence, the type of ITR in which you are required to file your returns is according to the kind of income that you are declaring in the income tax return. Returns for Assessment Year 2018-19 are specified in SEVEN forms.

ITR form Kind of income and person to which applicable
ITR-1 (SAHAJ) Resident individuals having different combinations of

  • Income from Salaries
  • One house property
  • Other sources (Interest etc.)
  • Total income upto Rs.50 lakh
ITR 2 Individuals and HUFs having different combinations of

  • Income from salary
  • Income from more than one house property
  • Income from interest and other sources and
  • Income from capital gains
  • NOT having income from business and profession
ITR 3 Individuals and HUFs having

  • Income from profits and gains of business or profession
ITR 4 (Sugam) Individuals, HUFs and firms having Presumptive Income from Business & Profession
ITR 5 Firms and LLPs NOT having Presumptive Income from Business & Profession
ITR 6 Companies other than companies claiming charitable non-profit activities
ITR 7 Persons including companies required to furnish return under sections 139(4A) or 139(4B) or 139(4C) or 139(4D) or 139(4E) or 139(4F) (political parties, trusts etc)

The detailed scheme of ITR forms according to different kinds of income and classes of taxpayers is presented in the table below:

Individual and HUF
Nature of income ITR 1 (Sahaj) ITR 2 ITR 3 ITR 4
Income from salary/pension (for ordinarily resident person)
Income from salary/pension (for not ordinarily resident and non-resident person)
Income or loss from one house property (excluding brought forward and carried forward losses)
Income or loss from more than one house property
Agricultural income exceeding Rs. 5,000
Total income exceeding Rs. 50 lakhs
Dividend income exceeding Rs. 10 lakhs taxable under Section 115BBDA
Income from other sources (other than winnings from lottery and race horses or losses under this head)
Income from other sources (including winnings from lottery and race horses or losses under this head)
Capital gains/loss on sale of investments/property
Interest, salary, bonus, commission or share of profit received by a partner from a partnership firm.
Income from business or profession
Income from presumptive business
Income from foreign sources or Foreign assets or having Signing authority in any account outside India

What is original Income tax return?

A valid income tax return in which all applicable columns are filled in and which is filed before the due dates for filing return of income expires is called as original return.

What is Revised Income tax return?

After filing of original return if the taxpayer finds some mistakes or omissions in the original return then such a return can be revised and is called as a revised return. The return can be revised only till the end of assessment year. The return for assessment year 2018-19 can be revised only till 31st March 2019. The form of the ITR can be changed in the revised return, i.e. it is possible to have filed the original return in ITR 1 and to file a revised return it in ITR 2. The revision of return comes with certain disadvantages:

  • The interest on tax amount shall be computed till the date submitting the revised return.
  • If the return is revised to conceal some income, then it may attract penalty.
  • If the return is revised after a notice from the Income tax Department or after a survey action, then this may attract penalty.

What is belated return?

It is possible to file an income tax return beyond the end date of the relevant assessment year. The income tax return filed beyond due date is called as ‘belated return.’ Belated return faces certain disadvantages for a taxpayer:

  • You CANNOT claim the carry forward and set off of losses under business and capital gains.
  • There are certain deductions which are NOT available when return is filed beyond due date.
  • There are certain exemptions which are NOT available when the return is filed beyond due date.
  • You CANNOT avoid additional interest under section 234A of the Income tax Act.
  • You will be charged the late filing fees which is minimum of Rs.5000/- and maximum of Rs.10000/-.

What is ITR-V?

What will happen if the return is not filed?

Is return required to be filed even if all the taxes are paid?