Now it is the time to study the terms
of exemption from requirement of filing of return as the last date of filing of
Income Tax return is 31st July.
Here are some frequently asked question to help you eligibility for such
exemption:
Frequently Asked Questions (FAQs) on EXEMPTION FROM FILING OF INCOME TAX RETURN
Que1. What is
the purpose of this notification and who are proposed to be exempted from the
requirement of filing of the return?
the purpose of this notification and who are proposed to be exempted from the
requirement of filing of the return?
Ans: The primary
objective of this notification is to exempt those salaried taxpayers from the
requirement of filing income-tax returns, who have (i) total income not
exceeding Rs.5,00,000, and (ii) the total income consists only of income
chargeable to income tax under the head Salaries and interest income from
savings bank account if such interest income does not exceed Rs.10,000.
objective of this notification is to exempt those salaried taxpayers from the
requirement of filing income-tax returns, who have (i) total income not
exceeding Rs.5,00,000, and (ii) the total income consists only of income
chargeable to income tax under the head Salaries and interest income from
savings bank account if such interest income does not exceed Rs.10,000.
Further, such
salaried taxpayer would be eligible for exemption from filing a return of
income only if tax liability has been discharged by the employer by way of Tax
Deducted at Source (TDS) and the deposit of the same to the credit of the
Central Government. For this purpose, taxpayer has to intimate his interest
income to the employer during the course of the year.
salaried taxpayer would be eligible for exemption from filing a return of
income only if tax liability has been discharged by the employer by way of Tax
Deducted at Source (TDS) and the deposit of the same to the credit of the
Central Government. For this purpose, taxpayer has to intimate his interest
income to the employer during the course of the year.
For Example –
(i) If an individual has salary income of Rs.4,90,000 and interest income from
savings bank account not exceeding Rs.10,000 (which has been reported to the
employer and tax has been deducted thereon), then the taxpayer would be exempt
from the requirement of filing income-tax returns since the total income from
both the above sources does not exceed five lakh rupees.
(i) If an individual has salary income of Rs.4,90,000 and interest income from
savings bank account not exceeding Rs.10,000 (which has been reported to the
employer and tax has been deducted thereon), then the taxpayer would be exempt
from the requirement of filing income-tax returns since the total income from
both the above sources does not exceed five lakh rupees.
(ii) A taxpayer having salary income of
Rs.4,98,000 and interest income from savings bank account of Rs.2,000 (which
has been reported to the employer and tax has been deducted thereon), would
also be eligible under this Scheme.
Rs.4,98,000 and interest income from savings bank account of Rs.2,000 (which
has been reported to the employer and tax has been deducted thereon), would
also be eligible under this Scheme.
(iii) A taxpayer having salary income upto
Rs.5,00,000 and nil interest income would also be eligible under this Scheme.
Rs.5,00,000 and nil interest income would also be eligible under this Scheme.
(iv) A taxpayer having salary income of Rs.5,50,000,
interest income from savings bank account of Rs.8,000(which has been reported
to the employer and tax has been deducted thereon), and who has claimed
deduction of Rs.70,000 under section 80C (on account of certain
payments/investments/savings) would also be eligible under the Scheme.
interest income from savings bank account of Rs.8,000(which has been reported
to the employer and tax has been deducted thereon), and who has claimed
deduction of Rs.70,000 under section 80C (on account of certain
payments/investments/savings) would also be eligible under the Scheme.
(v) A taxpayer having salary income of
Rs.6,10,000, interest income from savings bank account of Rs.10,000 (which has
been reported to the employer and tax has been deducted thereon), and who has
claimed deduction of Rs.1,00,000 under section 80C (on account of certain
payments/investments/savings), a deduction of Rs.20,000 under 80CCF
(Infrastructure Bonds) and a further deduction of Rs.15,000 under section 80D
(Health Insurance Premium) would also be eligible under the Scheme.
Rs.6,10,000, interest income from savings bank account of Rs.10,000 (which has
been reported to the employer and tax has been deducted thereon), and who has
claimed deduction of Rs.1,00,000 under section 80C (on account of certain
payments/investments/savings), a deduction of Rs.20,000 under 80CCF
(Infrastructure Bonds) and a further deduction of Rs.15,000 under section 80D
(Health Insurance Premium) would also be eligible under the Scheme.
Que2. Whether
a salaried taxpayer having total income of less than Rs.5,00,000 and claiming a
refund of Rs.3,000 would be eligible under this Scheme
a salaried taxpayer having total income of less than Rs.5,00,000 and claiming a
refund of Rs.3,000 would be eligible under this Scheme
Ans: No.
The taxpayer has to file a return of income for making a claim of refund.
The taxpayer has to file a return of income for making a claim of refund.
Que3. Is
having a valid PAN number a precondition for being covered by the notification?
having a valid PAN number a precondition for being covered by the notification?
Ans: Yes.
The notification clearly specifies that the individual has to report his PAN to
the employer. Hence having a valid PAN is a precondition for falling within the
ambit of the notification.
The notification clearly specifies that the individual has to report his PAN to
the employer. Hence having a valid PAN is a precondition for falling within the
ambit of the notification.
Que4. Can
an individual who is getting income under the head “salaries” from more than
one employer take benefit of the notification?
an individual who is getting income under the head “salaries” from more than
one employer take benefit of the notification?
Ans: No. A salaried
taxpayer who has earned income from more than one employer during the financial
year is not covered under this Scheme.
taxpayer who has earned income from more than one employer during the financial
year is not covered under this Scheme.
Que5. Whether
this notification would also cover taxpayers having ‘loss from house property’,
which are often reported by the employees to the employer.
this notification would also cover taxpayers having ‘loss from house property’,
which are often reported by the employees to the employer.
Ans: No.
Under the existing procedure, DDO/employer can give credit to the employee for
a claim for loss under the head “income from house property” u/s 24 made by the
employee. As a result, a salaried employee’s total income may reduce to less
than Rs.5,00,000 as loss from the head “income from house property” would have
been set-off against salary income. Such a taxpayer is not exempted from filing
his return of income as the notification exempts only cases where the total
income is under the head “salary” and from savings bank account (income from
other sources) not in excess of Rs.10,000. If the taxpayer has any loss under
the head “income from house property”, he will not be eligible for exemption
from filing a return of income.
Under the existing procedure, DDO/employer can give credit to the employee for
a claim for loss under the head “income from house property” u/s 24 made by the
employee. As a result, a salaried employee’s total income may reduce to less
than Rs.5,00,000 as loss from the head “income from house property” would have
been set-off against salary income. Such a taxpayer is not exempted from filing
his return of income as the notification exempts only cases where the total
income is under the head “salary” and from savings bank account (income from
other sources) not in excess of Rs.10,000. If the taxpayer has any loss under
the head “income from house property”, he will not be eligible for exemption
from filing a return of income.
Que6. Does
savings bank account include other banking accounts like fixed deposits or
recurring deposits accounts?
savings bank account include other banking accounts like fixed deposits or
recurring deposits accounts?
Ans: No. The benefit
of the notification is available to taxpayers whose interest income comprises
of interest earned on savings bank account ONLY.
of the notification is available to taxpayers whose interest income comprises
of interest earned on savings bank account ONLY.
Que7. Circular
No. 8/2010 dated 13.12.2010 which is applicable for Assessment Year 2011-12
stipulates that the Drawing and Disbursing Officer (DDO)/Employer while
deducting TDS from salary of an employee cannot allow deduction u/s 80G except
donations made to the Prime Minister’s Relief Fund, the Chief Minister’s Relief
Fund or the Lt. Governor’s Relief Fund. Whether the notification would cover
only these cases?
No. 8/2010 dated 13.12.2010 which is applicable for Assessment Year 2011-12
stipulates that the Drawing and Disbursing Officer (DDO)/Employer while
deducting TDS from salary of an employee cannot allow deduction u/s 80G except
donations made to the Prime Minister’s Relief Fund, the Chief Minister’s Relief
Fund or the Lt. Governor’s Relief Fund. Whether the notification would cover
only these cases?
Ans: Yes. An
individual cannot avail the exemption under this notification if the claim of
deduction for donations under section 80G is for donations other than those
mentioned in Circular No.8/2010. A taxpayer has to file a return of income for
making a claim in respect of claim of deduction under section 80G for such
donations (not specified in Circular No.8/2010).
individual cannot avail the exemption under this notification if the claim of
deduction for donations under section 80G is for donations other than those
mentioned in Circular No.8/2010. A taxpayer has to file a return of income for
making a claim in respect of claim of deduction under section 80G for such
donations (not specified in Circular No.8/2010).
Que8. Will
a salaried individual having agricultural income, which is exempt from tax, be
covered within the ambit of the notification?
a salaried individual having agricultural income, which is exempt from tax, be
covered within the ambit of the notification?
Ans: A
salaried individual with agricultural income exceeding five thousand rupees
shall be out of the ambit of the notification. A return will have to be filed
in such a case, even if other conditions of the notification are satisfied as
the agricultural income (of more than Rs.5,000) has to be included, for rate
purposes, in the total income.
salaried individual with agricultural income exceeding five thousand rupees
shall be out of the ambit of the notification. A return will have to be filed
in such a case, even if other conditions of the notification are satisfied as
the agricultural income (of more than Rs.5,000) has to be included, for rate
purposes, in the total income.
Reference:
http://www.incometaxindia.gov.in/archive/FAQ_ITRExemptionFiling_07182011.pdf
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