Income tax department has launched new income tax website and new set of income tax returns for taxpayers in India. Income tax returns, shortly known as ITR, involve several types and taxpayers must know about them in detail. Individuals, business owners, and companies should file an income tax return every financial year when their income crosses a certain limit. The Ministry of Finance will revise the tax slabs before or after the union budget and taxpayers should aware of them in detail. Moreover, they should contact the income tax department officials to gather more information about various types of ITR forms that will help file returns accordingly.
What is ITR filing?
ITR is a form issued by the income tax department and a taxpayer should submit the same with earned income details. Filing ITR will result in many advantages and the applicability varies depending on the income, amount earned, company, etc. Anyone who is earning more than 5 lakhs per year should file ITR after consulting with an auditor. It is imperative to know the documents needed before submitting an ITR. Taxpayers can also submit a return online after creating an account that will save time to a large extent.
Understanding the types of ITR forms in India
Taxpayers should understand the types of ITR forms in India that will help them choose the right one. It is wise to file ITR forms on or before the due date to avoid penalties and other problems significantly.
ITR-1 is only meant for individuals whose total income exceeds Rs.50 lakhs in a year. The form is also known as Sahaj and people who earn income through salary or pension should file this return. Those who earn more money through one house property and other sources can choose this form for filing tax returns.
Who cannot use the ITR-1 form?
• People whose agriculture income is more than Rs.5000 and 50 lakhs in a year
• Individuals who earn income through capital gains, foreign assets, business, lottery, horse race, and more than one property.
ITR-2A is a new form introduced in the year 2015-16 exclusively for Hindu Undivided Family or individual taxpayers. It is applicable for those who earn income through income and own more than one property. A person who doesn’t earn income from capital gains or any other business is eligible to file this form.
Who cannot use the ITR-2A form?
Individuals who earn money through capital gains, business, foreign assets, and other sources outside India are not eligible to use this form
ITR-2 form is also meant for individuals and Hindu Undivided Families (HUFs) who earn income through salary or pension. Individuals who earn more than Rs.5000 can use this form for filing purposes.
On the other hand, those who have a yearly income of more than Rs.50 lakhs are eligible to apply for this form. An individual who earns income through more than one house property, capital gains, foreign assets, lotteries, and horse racing can use this form while filing income returns.
Who cannot use the ITR-2 form?
Those who earn money from any business ventures are not eligible to apply for this form.
This form is applicable for individuals and Hindu Undivided Families (HUFs) who earn money through salary, commission, interests, remuneration, and bonus. It is essential to know the eligibility properly before filing the ITR-3 form.
Anyone who meets the following requirements can use this form.
• An individual director of a company
• Investments in unlisted equity shares
• Income from house property and other sources
Who can’t use the ITR-3 form?
Those who earn income as a partner in a firm that conducts any business or profession are not eligible to use this form.
ITR-4 is applicable for individuals and Hindu Undivided Family (HUF) and those who meet the following requirements can use this form.
• Income through a business or profession and one house property up to 50 lakhs
• Money earned from lotteries, horse races, speculation, and windfalls which don’t exceed 50 lakhs
Who can’t use the ITR-4?
• Individuals whose income exceeds more than 50 lakhs and earn money from more than one house property
• Individuals who earn more money as a director and getting income from any sources outside India
• People who have foreign assets, investments in unlisted equity shares, and the director of a company
ITR-4S which is also known as Sugam form meant for individuals and Hindu Undivided Families (HUFs). Anyone who earns income more than Rs.50 lakhs from any business and single housing property and has an agricultural income less than Rs.5000 is eligible to apply for this form.
Who can’t use the ITR-4S?
Those who earn income through capital gains and foreign assets are not eligible to use this form.
ITR-5 form is suitable for local bodies who want to return returns online. Therefore, it is imperative to know more details before filing this form. Companies, limited liability partnerships (LLPs), co-operative societies, business trusts, Estate of deceased, Body of Individuals (BOIs), local authorities, Association of Persons (AOPs), and Estate of insolvent can use this form.
Any companies that are not claiming exemptions under section 11 can use this form and they should file the returns online. On the other hand, they should know the structure of the form before submitting the same which will help meet exact requirements.
ITR-7 form is mainly meant for individuals or companies who want to file their returns under the following sections.
• Section 139(4A)- Individuals who earn money through any property for religious activities or charity
• Section 139 (4B)-This section is for political parties that earn money above the non-taxable limit
• Section 139(4C)-It is applicable for news agencies, scientific associations, any funds, and medical institutions
• Section 139 (4D)- This section is for colleges, universities, and other institutions which don’t require the furnishing of income return or loss
• Section 139 (4E)- It is applicable for any business trust that doesn’t want to furnish income return or loss
• Section 139 (4F)-Any investment funds referred to in section 115UB can file the return by mentioning this section and they don’t need to furnish a return of income or loss.
Kindly contact us at 9744922222 or firstname.lastname@example.org for further clarifications.