Income Tax Return Filing Season: Frequently Asked Question (FAQ)

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Income Tax Return Filing Season:  Frequently Asked Question (FAQ)

 

What is a return of income?

​ITR stands for Income Tax Return​. It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income are communicated to the Income-tax Department. It also allows carry -forward of loss and claim refund from income tax department.​Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. These forms can be downloaded from www.incometaxindia.gov.in

  • What are the forms of return prescribed under the Income-tax Law?

​​​​​​​​​Under the I​ncome-tax Law, different forms of returns are prescribed for different classes of taxpayers. The return forms are known as ITR forms (Income Tax Return Forms). The forms of return prescribed under the Income-tax Law for filing of return of income for the assessment year 2020-21 (i.e., financial year 2019-20) are as follows:

Return Form Brief Description
ITR – 1 Also known as SAHAJ is applicable to an individual having salary or pension income or income from one house property (not a case of brought forward loss) or income from other sources (not being lottery winnings and income from race horses, income taxable under section 115BBDA or income reffered in section 115BBDA or income referred in section 115BBE).
ITR – 2 It is applicable to an individual or an Hindu Undivided Family not having income chargeable to income-tax under the head “Profits or gains of business or profession”
ITR – 3 It is applicable to an individual or a Hindu Undivided Family who has any income chargeable to tax under the head business or profession
ITR – 4 Also known as SUGAM is applicable to individuals or Hindu Undivided Family or partnership firm who have opted for the presumptive taxation scheme of section 44AD/ 44ADA/44AE.​
ITR – 5 This Form can be used by a person being a firm, LLP, AOP, BOI, artificial juridical person referred to in section 2(31)(vii), cooperative society and local authority. However, a person who is required to file the return of income under section 139(4A) or 139(4B) or 139(4C) or 139(4D) shall not use this form (i.e., trusts, political parties, institutions, colleges)
ITR – 6 It is applicable to a company, other than a company claiming exemption under section 11 (exemption under section 11 can be claimed by charitable/religious trust).
ITR – 7 It is applicable to a persons including companies who are required to furnish return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D) (i.e., trusts, political parties, institutions, colleges).
​ITR – V It is the acknow​ledgement of filing the return of income.

  • What are the different modes of filing the return of income?

​​​​​​The Return Form can be filed with the Income-tax Department in any of the following ways, –

  (i) by furnishing the return in a paper form;

 (ii) by furnishing the return electronically under digital signature;

(iii) by transmitting the data in the return electronically under electronic verification code;

(iv) by transmitting the data in the return electronically and thereafter submitting the verification of the return in Return Form ITR-V;

Note

Where the return of income is filed in the manner given at (iv) without digital signature, then the taxpayer should take two printed copies of Form ITR-V. One copy of ITR-V, duly signed by the taxpayer, is to be sent (within the period specified in this regard, i.e., 120 days) by ordinary post or speed post to “Income-tax Department – CPC, Post Bag No. 1, Electronic City Post Office, Bengalore-560100 (Karnataka). The other copy may be retained by the taxpayer for his record.

  • Which mode of filing of return is applicable to whom?

​​​​​​​​​​​The applicable return of income shall be furnished by a person mentioned in column (ii) of the Table below to whom the conditions specified in column (iii) apply, in the manner specified in column (iv) thereof:—

Sl. Person Condition Manner of furnishing return of income
(i) (ii) (iii) (iv)
1 Individual or Hindu undivided family
(a) Accounts are required to be audited under section 44AB of the Act;
Electronically under digital signature;
(b) A super senior citizen (whose age is 80 years or above at any time during the previous year) who furnishes the return either in ITR-1 or ITR-4

 

 

(A) Electronically under digital signature; or
(B) Transmitting the data electronically in the return under electronic verification code; or
(C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V; or
(D) Paper form;
(c) In any other case
(A) Electronically under digital signature; or
(B) Transmitting the data electronically in the return under electronic verification code; or
(C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V; ]
2 Company In all cases. Electronically under digital signature.
3 A person required to furnish the return in Form ITR-7
(a) In case of a political party;
Electronically under digital signature;
(b) In any other case

 

(A) Electronically under digital signature; or
(B) Transmitting the data in the return electronically under electronic verification code; or
(C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V.
4 Firm or limited liability partnership or any person (other than a person mentioned in Sl. 1 to 3 above) who is required to file return in Form ITR-5
(a) Accounts are required to be audited under section 44AB of the Act;
Electronically under digital signature;
(b) In any other case.
(A) Electronically under digital signature; or
(B) Transmitting the data in the return electronically under electronic verification code; or
(C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V
  • Is it necessary to attach any documents along with the return of income?
  • Who can use ITR – 1 (SAHAJ)?
  • Who cannot use ITR – 1 (SAHAJ)?
  • Who can use ITR – 2?
  • Who cannot use ITR – 2?
  • Who can use ITR – 3?
  • Who cannot use ITR – 3?
  • Who can use ITR – 4 (SUGAM)?
  • Who cannot use ITR – 4 (SUGAM)?
  • Who can use ITR – 5?
  • Who cannot use ITR – 5?
  • Who can use ITR – 6?
  • Who cannot use ITR – 6?
  • Who can use ITR – 7?
  • Who cannot use ITR – 7?
  • How to file the return of income electronically?
  • What is e-filing utility provided by the Income-tax Department?
  • Is there any e-filing help desk established by the Income-tax Department?
  • What is the difference between e-filing and e-payment?
  • Will I be put to any disadvantage by filing my return?
  • What are the benefits of filing my return of income?
  • What are the benefits of e-filing the return of income?
  • Is it necessary to file return of income when I do not have any positive income?
  • What are the due dates for filing returns of income/loss?
  • Will I be penalized on late filing of ITR even if I am not liable to file it?
  • If I fail to furnish my return within the due date, will I be fined or penalized?
  • Can a return be filed after the due date?
  • If I have paid excess tax how will it be refunded to me?
  • If I have committed any mistake in my original return, am I permitted to file a revised return to correct the mistake?
  • How many times can I revise the return?
  • Am I required to keep a copy of the return filed as proof and for how long?
  • There are various deductions that are not reflected in the Form 16 issued by my employer. Can I claim them in my return?
  • Why is return filing mandatory, even though all my taxes and interests have been paid and there is no refund due to me?
  • Am I liable for any criminal prosecution [arrest/imprisonment, etc.] if I don’t file my Income-tax return, even though my income is taxable?
  • What is Form 26AS?
  • What to do if discrepancies appear in actual TDS and TDS credit as per Form 26AS?
  • What precautions should be taken while filing the return of income?

​​​

The followings are the important steps/points/precautions to be kept in mind while filing the return of income:
1)  The first and foremost precaution is to file the return of income on or before the due date. Taxpayers should avoid the practice of filing belated return. Following are the consequences of delay in filing the return of income/ Loss (other than house property loss):
a.        Losses cannot be carried forward.
b.        Levy of interest under section 234A.
c.        Late filing fees under section 234F is levied for return filed from A.Y 2018-19 onwards. Late filing fee of Rs. 5,000 shall be payable if return furnished after due date but before 31st December of the assessment year. In other cases, late filing fees of Rs. 10,000 is payable. However amount of late filing fees to be paid cannot exceed Rs. 1,000, if total income does not exceed Rs. 5 Lakh.
d.        Exemptions under section 10A​, section 10B, are not available.
e.        Deduction under 80-IA, 80-IAB, 80-IB, 80-IC , 80-ID and 80-IE, are not available.
f.        Deduction under 80IAC, 80IBA, 80JJA, 80JJAA, 80LA, 80P, 80PA, 80QQB and 80RRB are not available. (From A.Y 2018-19)
2)    Taxpayer should download Form 26AS and should confirm actual TDS/TCS/Tax paid. If any discrepancy is observed then suitable action should be taken to reconcile it.
3)    Compile and carefully study the documents to be used while filing the return of income like bank statement/passbook, interest certificate, investment proofs for which deductions is to be claimed, books of account and balance sheet and P&L A/c (if applicable), etc.
4)    No documents are to be attached along with the return of income. The taxpayer should identify the correct return form applicable in his case. Carefully provide all the information in the return form. Confirm the calculation of total income, deductions (if any), interest (if any), tax liability/refund, etc.
5)    Ensure that other details like PAN, address, e-mail address, bank account details, etc., are correct.
6)     After filling all the details in the return of income and after confirmation of all the details, one can proceed with filing the return of income. In case return is filed electronically without digital signature and without electronic verification code do not forget to post the acknowledgement of filing the return of income at CPC Bangalore within 120 days of filing return of income.

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