Business

Income Tax Return: Forms for Missing Deadline and Types of Penalties

July 26, 2022
Bharat Times

E-filing has made it easy for taxpayers to file their Income Tax Returns.

The central government is not considering giving exemption to those who fail to file their income tax return (ITR) before the July 31 deadline. “Dear Taxpayers, Remember if you have not filed your ITR yet. ITR Filing for AY 2022-23 is July 31, 2022,” Income Tax Department said on its official Twitter handle. Time to clear #FileNow Not there.

Why should you file income tax return on time?

Having a clean track record in income tax returns makes it easy to get a loan. there are other benefits Timely filing of Income Tax Returns, such as avoidance of penalties, legal action, easy loan approval, carry forward of losses and accelerated visas for international travel.

What happens if you miss the deadline?

A local circle survey on July 21 said that around 54 per cent of personal income taxpayers are yet to file their returns. The penalty this year is also stricter for those who fail to comply with the ITR filing deadline.

Delay in filing ITR can attract a penalty of Rs 10,000. Through ITR, a person has to furnish information to the Income Tax Department of India regarding the income during the year and the taxes to be paid on it.

If a person’s income exceeds the exemption limit, he/she has to file a tax return. Under the new tax regime, the exemption limit has been set at Rs 2.5 lakh.

Under the old regime, the exemption limit for people below 60 years of age is Rs 2.5 lakh; Rs 3 lakh for people between 60 and 80 years (senior citizens); and Rs 5 lakh for those above 80 years (Super Senior Citizen).

While the new regime has done away with many exemptions, the tax slabs point to much lower rates than the old regime.

Income Tax (IT) a. is based on slab system, which means that the rates vary according to the level of income. The tax rate changes as income increases.

seven types

The Income Tax Department has prescribed seven types of ITR forms, the applicability of which will depend on the nature and amount of income and the type of taxpayer.

ITR 1 or Sahaj: This income tax return form is for individuals whose total income in a financial year is less than Rs 50 lakh. This includes: income from salary/pension, profit from a house property (excluding cases where losses from the previous financial year are carried forward), income from other sources (includes winning lotteries and race houses) is not), and the income from agricultural activities does not exceed Rs.5,000.

ITR 2: This is for individuals and Hindu Undivided Family (HUF) whose total income from the following sources in a financial year is more than Rs 50 lakhs.

ITR 3: This form can be used by an individual or HUF whose source of income arises from business or profession.

ITR 4: Individuals, HUFs and partnership firms (other than LLPs) and residents of India are eligible to file returns under ITR 4 if their income includes business income as per the presumptive income scheme u/s 44AD/44AE. Income from scheme and salary/pension under section 44 ADA does not exceed Rs 50 lakh.

ITR 5: It caters to the following taxpayers – Firms, Limited Liability Partnership (LLP), Association of Persons (AOP), Body of Persons (BOI), Artificial Judicial Persons (AJP), Assets of the Deceased, Property of Bankruptcy, Business Trusts and Investments fund

ITR 6: This form is completed by companies that claim tax exemption under section 11. This section is for income earned from property held for charitable trusts and religious institutions. The important thing to note here is that this ITS can be filed electronically only.

ITR 7: It is to be used by individuals and companies who are required to file tax returns under the following sections: 139 (4A), 139 (4B), 139 (4C), 139 (4D), 139 (4E) and 139 (4F) ).

What are the changes in ITR rules from this year?

The government is giving conditional relief to senior citizens above 75 years of age from filing ITR since last year.

This exemption has been given due to section 194P introduced in the Union Budget 2021.

Read also | These individuals have to compulsorily file income tax returns. read the description

As per section 194P, senior citizens are not required to file ITR if they fulfill the following criteria: If they are residing in India and have attained the age of 75 years or more during the previous year.

The budget also introduced a window of 24 months from the end of the assessment year for filing a revised ITR in case an assessee misses to report an income or finds an error in filing tax return earlier.

There is also the opportunity to pay unpaid taxes for two years.

Income tax information for these high-value transactions

Income Tax Department Monitoring high value cash transactions beyond a specified limit. If you fail to mention such transactions in your Income Tax Return (ITR) filing, you are likely to get a notice.

Filing income tax returns is no longer the hassle it used to be. The long queues and endless worries of meeting the tax-filing deadline were gone.

with online filingAlso known as e-filing, it is convenient to file returns from the confines of your home or office and within a short span of time.