Filing of Income Tax Returns (ITR) in July 2014

In India, the system of direct taxation has been in force in various forms since ancient times. There are references both in Manu Smriti and Arthasastra to a variety of tax measures. In modern India income tax was introduced by Sir James Wilson on 24 July 1860. It was a tax selectively imposed on the rich, royalty and Britishers, and hence was not liked by the powerful. The Act lapsed in 1865 and was re-introduced in a different form in 1867.

Important Dates

WHAT IS INCOME TAX?

In the modern times, income tax is an annual tax on income. The Indian Income Tax Act (Section 4) provides that in respect of the total income of the previous year of every person, income tax shall be charged for the corresponding assessment year at the rates laid down by the Finance Act for that assessment year. Section 14 of the Income Tax Act further provides that for the purpose of charge of income tax and computation of total income all income shall be classified under the following heads of income: salaries, income from house property, profits and gains of business or profession, capital gains, income from other sources.

The total income from all the above heads of income is calculated in accordance with the provisions of the Act as they stand on the first day of April of any assessment year. The Income Tax Department is responsible for all activities related to the taxation process.

The Income Tax Department is governed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue under the Ministry of Finance, Government of India.

WHO HAS TO PAY INCOME TAX?

The word income has a very broad and inclusive meaning. In case of a salaried person, all that is received from an employer in cash, kind or as a facility is considered as income. For a businessman, his net profits will constitute income. Income may also flow from investments in the form of Interest, Dividend, and Commission etc. Infact the Income Tax Act does not differentiate between legal and illegal income for the purpose of taxation. Under the Act, all incomes earned by people are classified into five different heads, such as: income from salary, income from house property, income from business or profession, income from capital gains and income from other sources.

INCOME TAX RATES

Individuals, Hindu Undivided Families, AOPs, BOIs

For any other resident individual (born on or after April 1, 1954), any non-resident individual, every Hindu Undivided Family (HUF), Association of Persons (AOP) or a Body of Individuals (BOI),artificial juridical person following are the Income Tax Rates.

Net income range	Income-tax rates	Surcharge	Edu cess	Sec and higher education cess
Up toRs.2,00,000	Nil	Nil	Nil	Nil
Rs.2,00,000 –Rs.5,00,000	10% of (total income minus Rs.2,00,000)	Nil	2% of income-tax	1% of income-tax
Rs.5,00,000 –Rs.10,00,000	Rs.30,000 + 20% of (total income minus Rs.5,00,000)	Nil	2% of income-tax	1% of income-tax
Rs.10,00,000 –Rs.1,00,00,000	Rs.1,30,000 + 30% of (total income minus Rs.10,00,000)	Nil	2% of income-tax	1% of income-tax
AboveRs.1,00,00,000	Rs.28,30,000 + 30% of (total income minus Rs.1,00,00,000)	10% of income-tax	2% of income-tax and surcharge	1% of income-tax and surcharge

Senior Citizen

For a resident senior citizen (who is 60 years or more at any time during the previous year but less than 80 years on the last day of the previous year, i.e., born during April 1, 1934 and March 31, 1954

Net income range	Income-tax rates	Surcharge	Edu cess	Sec and higher education cess
Up toRs.2,50,000	Nil	Nil	Nil	Nil
Rs.2,50,000 –Rs.5,00,000	10% of (total income minus Rs.2,50,000)	Nil	2% of income-tax	1% of income-tax
Rs.5,00,000 –Rs.10,00,000	Rs.25,000 + 20% of (total income minus Rs.5,00,000)	Nil	2% of income-tax	1% of income-tax
Rs.10,00,000 –Rs.1,00,00,000	Rs.1,25,000 + 30% of (total income minus Rs.10,00,000)	Nil	2% of income-tax	1% of income-tax
AboveRs.1,00,00,000	Rs.28,25,000 + 30% of (total income minusRs.1,00,00,000)	10% of income-tax	2% of income-tax and surcharge	1% of income-tax and surcharge

Super Senior Citizen

For a resident super senior citizen (who is 80 years or more at any time during the previous year, i.e., born before April 1, 1934)

Net income range	Income-tax rates	Surcharge	Edu cess	Sec and higher education cess
Up toRs.5,00,000	Nil	Nil	Nil	Nil
Rs.5,00,000 –Rs.10,00,000	20% of (total income minus Rs.5,00,000)	Nil	2% of income-tax	1% of income-tax
Rs.10,00,000 –Rs.1,00,00,000	Rs.1,00,000 + 30% of (total income minus Rs.10,00,000)	Nil	2% of income-tax	1% of income-tax
AboveRs.1,00,00,000	Rs.28,00,000 + 30% of (total income minus Rs.1,00,00,000)	10% of income-tax	2% of income-tax and surcharge	1% of income-tax and surcharge

Co-operative Societies

Assessment year 2014-15
Co-operative societies – The following rates are applicable to a Co-operative Society for the assessment years 2013-14 and 2014-15.

Net income range	Income-tax rates
Up to Rs.10,000	10%
Rs.10,000 – Rs.20,000	20%
Rs.20,000 and above	30%

Firms
Assessment year 2014-15 –

A firm is taxable at the rate of 30 per cent for the assessment years 2013-14 and 2014-15.

Specified Income Tax rates for other income

Check the rates of other taxable income such as: short-term capital gains, long-term capital gains, etc. for the Assessment year 2014-15

TAX CALCULATION AND PAYMENT

The Income Tax Department has developed an online Tax calculator.

Individuals, HUF, Company, Firm, AOP, BOI, etc. can calculate their tax amount of the respective Assessment Year.

Taxpayers, deductors or collectors can pay taxes in cash/cheque at any designated bank branches by submitting the appropriate Challan. An online payment facility is also available.

FILING INCOME TAX RETURNS

As per Taxation Rules, it is mandatory for an earning individual/entity to file a return irrespective of the fact that tax has been deducted at source by his/her employer or not, and whether he/she is eligible for a refund or not.

Note: The CBDT has, vide notification dated 1-05-2013, made E-filing of Return compulsory for Assessment Year 2013-14 for persons having total assessable income exceeding Five lakh rupees.

The CBDT vide its earlier notifications had exempted salaried employees having total income upto Rs.5 lakhs including income from other sources upto Rs.10,000/- from the requirement of filing return of income for assessment year 2011-12 and 2012-13 respectively. The exemption was available only for the assessment year 2011-12 and 2012-13. The exemption was giving considering ‘paper filing of returns’ and their ‘processing through manual entry’ on system.

To file Income Tax Returns (ITRs), one needs to submit the ITRs belonging to the particular assessment year. The ITR forms to file income returns for AY 2014-15 are as follows:

Note:- All Forms are in PDF

Note:- All Forms are in PDF

Indian Individual Income tax Return

SAHAJ
(ITR-1)

SAHAJ and SUGAM forms are coloured forms with standard
features. Taxpayers can download the forms from the website and print using a
colour printer on an A4 size white paper.

Please read the instructions
for SAHAJ before filling the form.

Individuals and HUFs not having income from Business or
Profession

ITR
2
Read instructions
for ITR 2

For Individuals/HUFs being partners in firms and not carrying out
business or profession under any proprietorship

ITR
3
Read instructions
for ITR 3

Sugam – Presumptive Business Income tax Return
SUGAM
(ITR-4S)
Please read the instructions
for SUGAM before filling the form.

For individuals and HUFs having income from a proprietary business or
profession

ITR
4
Read instructions
for ITR 4

For firms, AOPs and BOIs

ITR
5
Read instructions
for ITR 5

For Companies other than companies claiming exemption under section
11

ITR
6
Read instructions
for ITR 6

For persons including companies required to furnish return under
section 139(4A) or section 139(4B) or section 139(4C) or section
139(4D)

ITR
7
Read
instructions for ITR 7

Acknowledgement for e-Return and non e-Return

Acknowledgement

Further instructions and forms for previous years can be found here.

E-FILING OF INCOME TAX RETURNS

The E-Filing facility was introduced by the Income Tax Department for the first time during assessment year 2006-07. At present, it is mandatory for companies and firms requiring statutory audit under Section 44AB to e-file their Income Tax Returns. Also, the e-filing benefit has been extended to all assesses.

For registration in e-filling portal please click here

The registered users can avail online services such as: submit Returns/Forms, view Form 26AS (Tax Credit), Outstanding Tax Demand, ITR-V Receipt Status, CPC Refund Status, Rectification Status, Jurisdiction of Accessment Officers, etc.

TAX DEDUCTION AT SOURCE (TDS)

Tax Deduction at Source (TDS) is one of the modes of collection of taxes, by which a certain percentage of amounts are deducted from a person at the time of making/crediting certain specific nature of payment to the other person and the deducted amount is remitted to the Government account. It is similar to “pay as you earn” scheme also known as Withholding Tax in many other countries.

Every person responsible for making payment of nature covered by TDS provisions of Income Tax Act shall be responsible to deduct tax. However, in case of payments made under sec. 194A, 194C, 194H, 194I and 194J in respect of individual and HUF, only if the turnover or professional receipt exceeds sum of Rs.40 lakh or Rs.10 lakh respectively (the limits are Rs.60 Lakh or Rs.15 Lakh respectively w.e.f. 01.07.2010) in previous year, he is required to deduct tax at source.

Learn the basics of TDS

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Filing of Income Tax Returns (ITR) in July 2014

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