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Income Tax Return

Income Tax Return is the form in when assessee files information about his Income and tax thereon to Income Tax Department. Various forms are ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7. When you file a belated return, you are not allowed to carry forward certain losses.

The Income Tax Act, 1961, and the Income Tax Rules, 1962, obligates citizens to file returns with the Income Tax Department at the end of every financial year. These returns should be filed before the specified due date. Every Income Tax Return Form is applicable to a certain section of the Assessees. Only those Forms which are filed by the eligible Assessees are processed by the Income Tax Department of India. It is therefore imperative to know which particular form is appropriate in each case. Income Tax Return Forms vary depending on the criteria of the source of income of the Assessee and the category of the Assessee.

Filling of ITR on these Field

Filing IT returns is mandatory for those who earn a certain annual income within a pre-determined due date. Though it can be a tedious task, it comes with a number of advantages: Advantages of filing tax returns
  • Filing IT returns makes you a responsible citizen of your nation. 
  • This can boost chances of getting a suitable home loan if you apply for one in the future. 
  • Some credit card companies demand proof of tax returns before issuing a card.  
  • As income is recorded by the tax department, it is easier for individuals to enter into future transactions with minimal complications  
  • In cases when you want to claim adjustment against past losses, a return is compulsory. Filing returns may prove useful when someone needs to file a revised return. A person cannot file a revised return unless he/she has filed the original return.  

A business tax return is basically an income tax return. The return is a statement of income and expenditure of the business. Also, any tax to be paid on the profits made by you is declared in this return. The return also contains details of the assets and liabilities held by the business.

Partnership firm is looked upon as a separate entity. It is immaterial that partnership is registered or not registered. So partnership firm is taxes under the income tax slab for partnership firm and partners are taxed under the income tax slab for individuals.

Income tax surcharge is applicable on the amount of income-tax computed. Income tax surcharge is applicable on the following rates based on the total income of the company.
  • Companies having total income of Rs. 1 crore to Rs.10 crore rupees are liable to pay income tax surcharge at the rate of 7% of such income-tax.
  • Companies having a total income of over Rs.10 crore rupeesare liable to pay income tax surcharge at the rate of 12% of such income-tax.

Co-operative society means a society registered under Co-operative Societies Act, 1912 or any other law in force in any State for the registration of co-operative societies.

Regional rural bank is deemed as co-operative society (Circular 319 dated 11-1-1982)

Rate of Tax

Income up to ` 10,000 = 10%

Income ` 10,001 up to ` 20,000 = 20% of income exceeding 10,000 + 1,000

Income ` 20,001 onwards = 30% of income exceeding 20,000 + 3,000

In case the taxable income is above ` 1 crore a surcharge of 12% would be applicable for income earned .

The above rates to be increased by 2% education cess on income tax & 1% secondary & higher education cess on income tax.