Income Tax Filing – Description
Income Tax Filing is the process of submitting your income details to the Income Tax Department of India to determine tax liability or refunds. It is a mandatory process for individuals, businesses, and organizations earning taxable income in a financial year. Tax returns are filed using an Income Tax Return (ITR) form based on income sources and taxpayer category.
Purpose of Income Tax Filing:
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Legal Compliance – Mandatory under the Income Tax Act, 1961.
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Avoid Penalties – Late or non-filing can lead to fines or legal action.
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Claim Tax Refunds – Get refunds on excess tax deducted (TDS).
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Loan & Visa Approvals – Banks and embassies require ITRs for verification.
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Carry Forward Losses – Allows taxpayers to adjust losses against future profits.
Who Needs to File an ITR?
✅ Individuals earning above the basic exemption limit (₹2.5 lakh for individuals, ₹3 lakh for senior citizens).
✅ Businesses & Professionals with income above the prescribed limit.
✅ Companies, LLPs, Trusts, and NGOs, regardless of profit or loss.
✅ Freelancers & Self-Employed Individuals exceeding taxable income.
✅ NRI & Foreign Income Earners meeting tax conditions.
Types of ITR Forms & Eligibility:
| ITR Form | Applicable For |
|---|---|
| ITR-1 (Sahaj) | Salaried individuals with income up to ₹50 lakh, one house property, and other limited sources. |
| ITR-2 | Individuals & HUFs (Hindu Undivided Families) with income above ₹50 lakh or capital gains. |
| ITR-3 | Business owners & professionals. |
| ITR-4 (Sugam) | Presumptive taxation for small businesses & professionals (up to ₹2 crore turnover). |
| ITR-5 | Partnership firms, LLPs, associations. |
| ITR-6 | Companies (except those claiming tax exemption under Section 11). |
| ITR-7 | Trusts, NGOs, and institutions under Sections 139(4A) to 139(4D). |
How to File Income Tax Returns?
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Gather Required Documents (PAN, Aadhaar, Form 16, Form 26AS, bank statements, investment proofs).
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Login to the Income Tax e-Filing Portal (www.incometax.gov.in).
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Select the Appropriate ITR Form based on income type.
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Fill in Income & Deduction Details (Salary, business income, capital gains, exemptions).
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Verify Tax Calculation and pay any outstanding tax, if applicable.
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Submit the ITR & Verify (via Aadhaar OTP, net banking, or offline by sending a signed ITR-V to CPC, Bangalore).
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Receive Acknowledgment & Processing Status from the IT Department.
Due Dates for ITR Filing (FY 2023-24):
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Individuals & Non-Audit Cases – July 31, 2024
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Businesses Requiring Audit – October 31, 2024
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Companies & Firms Filing Transfer Pricing Reports – November 30, 2024
Penalties for Late Filing:
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₹1,000 (income below ₹5 lakh).
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₹5,000 (income above ₹5 lakh).
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Additional interest under Section 234A, 234B & 234C for tax dues.
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