Income Tax Returns (ITRs)

Income Tax Returns (ITRs)

Total 7 ITRs are notified by the Income Tax Department, which are applicable for different assessee and for their specified income.
  

One has to identify, which ITR form is suitable for filing his/her Income Tax Return. ITR may be different from previously filed return for the same person, if source/type of income is different from previous year.

ITR-1

Who can file ITR- 1?

Eligible assessee:  Resident Individual, excluding;

-an individual who is either a Director in a company or has invested in unlisted equity shares (ITR-2 or ITR-3 is applicable).

Type of Income:  Following type of income can be declared under ITR-1, popularly known as form ‘SAHAJ’.

• Salary or Pension.
• One House property, If income from more than one house property then ITR–1 is not applicable (and ITR-3 is applicable).
• Income from other sources, like interest from term deposit.
• If total income is upto Rs. 50 lakh (if more then Rs 50 lakh, then ITR-2 is applicable).
• If Agriculture income is less then Rs. 5000 (If Rs. 5000 or more than , ITR-2 is applicable).

Explained: What is Total Income?
        

Total Income is Gross Total Income (GTI) - applicable Deductions

Gross Total Income (GTI) = Income from all head of Income (viz. Salary, house property, business and profession, capital gain and other sources).

ITR-2

Who can file ITR- 2 ?

Eligible assessee: Individual and Hindu Undivided Family (HUF)

Type of Income:  Following type of income can be declared under ITR-2:

• If total income is more than Rs. 50 lakh.
• If income from Capital Gain.
• Any foreign income.
• Agriculture Income, if more than Rs. 5000.

    Simply said, ITR-2 is applicable for the Individuals and HUF, who is not eligible to file ITR-1 and who is not having any income under the head 'Profit or gains of business and profession'. 

   ITR-3

    Who can file ITR-3 : Individual and HUF

Type of Income:
  
1. Income from Business/Profession (except, where ITR- 4 is applicable)
2. Income from firm (as a partner)
3. Who is not eligible to file ITR -1 (SAHAJ), ITR-2 and ITR- 4 (SUGAM).


Individual or HUF having type 1, 2 and 3 (as above) income and also have income from Salary/ Pension/Income from Other Sources/Income From House property and Income from Capital gain, then also this form is applicable. 

ITR-4 (SUGAM)

Who can file ITR- 4: 

1. Resident Individual or Resident HUF,
2. A (Resident) firm (other than Limited Liability Partnership/LLP)
3. Total Income does not exceeds Rs. 50,00,000/-

Type of Income:
1. Income from business where income is computed on presumptive basis under:
   - Section 44AD (gross turnover is upto Rs. 2 crore)
   - Section 44AE ( income from goods carriage upto 10 vehicles)
2. Income from profession where income is computer on presumptive basis under:
   - Section 44ADA (gross receipts upto Rs. 50 lakh).

[These are certain provisions under Income Tax Act for small business and professionals, where they can declare income at specified rate/(or higher rate also) on gross turnover/ total receipts and pay tax accordingly].

Now, Who is not eligible for ITR- 4

- An individual who is either a Director in a company or,
- Has invested in unlisted equity shares.

ITR-5

Who is eligible to file ITR-5:

All, except:

- Individual,

- HUF,

- Company,

- Person filing ITR-7

For example: Firms, LLPs, AOPs (Association of persons) and BOIs (Body of Individuals), Artificial Juridical Person (AJP), Estate of deceased, Estate of insolvent, Business trust and investment fund etc.

ITR-6

Who is eligible:

Companies, who is not claiming exemption under section 11 of the Income Tax Act (ITR-7 is applicable).

[Section 11 pertains to relaxation regarding property held for charitable and religious purposes].

ITR-7

Who is eligible to file:

This return is applicable for persons and companies, who are required to file their IT return under following section of Income Tax Act:

- Section 139 (4A): Income from property held for charitable and religious purposes.

- Section 139 (4B) : Retuun for political parties.

- Section 139 (4C) : Association, new agency etc.

- Section 139 (4D) : University, institution etc.

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House purchaser: Do not forget to file Form 26QB

House purchaser: Do not forget to file Form 26QB

This article is for who purchase any property* (immovable viz, House) for more than or equal to Rs. 50 lakh.

Suppose,

-Mr A purchase a house (or any other immovable property) from Mr. B,

-Sale price is fixed as Rs. 50 Lakh (or more than 50 Lakh, say Rs. 2.50 crore),

-Mr. A will make the payment of Rs. 50 Lakh (or more than Rs. 50 Lakh, say Rs. 2.50 crore) to Mr. B,

- At the time of making the payment,

- Mr. A will deduct 1% of the sale amount (1% of Rs. 50 Lakh/2.50 crore, as per above example),

- Mr A can ask PAN of the Mr B,

- And will deposit this 1% (amount deducted) to Government through authorized Bank branches ( list :- https://www.tin-nsdl.com/authorized-banks.html)/or himself through online banking,

- Within 30 days from the month, in which deduction is made (or sale amount is paid to the seller),

- After this, Mr. A may issue form 16B (available for download at www.tdscpc.gov.in after payment) to Mr. B,

-Stating amount deducted and paid to the Government (for taking Tax Credit by Mr. B).

Here, the noting point is that liability to deduct 1% of the sale amount and pay to Government is of purchaser (Mr. A) and not the of the seller (Mr. B).

After the deduction Mr. A has to furnish the information online (in form 26QB) at site www.tin-nsdl.com

* Property excludes Rural Agriculture Land.

*Property includes any under construction property also.

Now suppose that house was in the joint names of Mr. B and Mrs C and Mr D and Mr. A purchased the house.

Then form 26QB has to be filed for each unique Buyer Seller transaction.

(Mr A ------Mr B)

(Mr A ----- Mrs C)

(Mr A -----Mr D)

Hence 3 form 26QB.

Mr. A and Mr. B purchased house from Mr. C and Mr. D (for Rs. 51 Lakh)

(Mr. A ---- Mr. C)

(Mr. B ---- Mr. C)

(Mr. A ----Mr. D)

(Mr. B ---- Mr. D)

Hence four form 26 QB have to be filed.

- If form 26QB not filed within 30 days, fee will be levied.

Step by Step Guide to file form 26QB:

Step 1

1. Log on to NSDL e-Gov -TIN website (www.tin-nsdl.com).

1. Click on the option “Furnish TDS on property”.

1. Select Form for Payment of TDS on purchase of Property.

Step 2:

After selecting the form you will be directed to the screen for entering certain information.

Example:-

a) Permanent Account Number (PAN) of Property Purchaser and Seller.

b) Address of the Purchaser, Seller as well as the Property being purchased

c) Financial/ Assessment Year will be populated on the basis of Date of Payment/Credit selected in the Form.

d) Major Head Code - To indicate the type of tax applicable viz; Tax on companies/Tax on other than companies

e) Value of Property

f) Date of agreement/booking

g) Amount Paid/credited (Transaction amount)

h) Rate of TDS

i) TDS Amount

j) Dates of payment/credit, deduction

k) Select the option for “Payment of taxes on Subsequent Date”It is important to ensure that PAN of Buyer and Seller are correctly mentioned in the form.

There is no online mechanism for subsequent rectification. Deductor will have to approach the Assessing Officer or CPC-TDS for rectification of errors.

Step 3

After entering all the above detail, click on PROCEED button. The system will check the validity of PAN. In case PAN is not available in the database of the Income Tax Department then you cannot proceed with the payment of tax.

If PAN is available then TIN system will display the contents you have entered along with the “Name” appearing in the ITD database with respect the PAN entered by you.

Step 4

You can now verify the details entered by you. In case you have made a mistake in data entry, click on "EDIT" to correct the same. If all the detail and name as per ITD is correct, click on "SUBMIT" button.

Nine digit alpha numeric ACK no. will be generated and you will be provided with an option to print an Acknowledgment slip.Please be informed that the name and status of PAN is as per the ITD PAN Master.

You are required to verify the name before making payment. In case any discrepancy is observed, please confirm the PAN entered by you. Any change required in the name displayed as per the PAN Master can be updated by filling up the relevant change request forms for PAN. If the name is correct, then click on "Confirm".

Step 5

With the printout of the Acknowledgment slip, you may visit any of the authorized Bank branches to make the payment of TDS subsequently. The Bank will make the payment through its net banking facility and provide you the Challan counterfoil as acknowledgment for payment of taxes.

Based on the information in the Acknowledgment slip, the bank will make the payment only through net-banking facility by visiting tin-nsdl.com and entering the acknowledgement number duly generated by TIN for the statement already filled by the buyer in respect of that transaction.

In case you desire to make the payment through e-tax payment (net banking account) subsequently, you may access the link “E-tax on subsequent date” on the TIN website. On entering the details as per the acknowledgment slip, you will be provided an option to submit to the bank wherein you have to select the Bank through which you desire to make the payment.

You will be taken to the net banking login screen wherein you can make the payment online.offline Form:https://onlineservices.tin.egov-nsdl.com/etaxnew/PopServletOffline

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