FAQ's on filing the return of income
It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income are communicated to the Income-tax Department. Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. These forms can be downloaded from www.incometaxindia.gov.in
Under the Income-tax Law, different forms of returns are prescribed for different classes of taxpayers. The return forms are known as ITR forms (Income Tax Return Forms).
Filing of return is your duty and earns for you the dignity of consciously contributing to the development of the nation. Apart from this, your income-tax returns validate your credit worthiness before financial institutions and make it possible for you to access many financial benefits such as bank credits, etc.
FAQ's on Provisions useful for non-residents
The due dates for filing return of income are as follows:
|Any person (other than companies), whose accounts are to be audited and the working partner of a firm whose accounts are to be audited
|| 30th September
|In all other cases
Yes, the residential status of a person earning income is very much relevant for determining the taxability of such income in his hands.
Taxability of any income in the hands of a person depends on the following two things:
- Residential status of the person as per the Income-tax Law; and
- Nature of income earned by him.
As per FEMA Act,
An Indian Citizen who stays abroad for (a) employment/ carrying on business or (b) vacation outside India or (c) stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. Persons posted in U.N. organizations and officials deputed abroad by Central/ State Government and Public Sector Undertakings on temporary assignments are also treated as non-resident.
As per Income Tax Act,
An individual is Non-Resident Indian if any of the following conditions are not satisfied:
- He stayed in India for 182 days or more during the previous year, or
- he stayed in India for 365 days or more during the four preceding years and stays in India for at least 60 days (182 days in case of an Indian citizen or a person of Indian Origin coming on a visit to India or in case of an Indian citizen going abroad for an employment) during the previous year.
FAQ's on Computation of Tax
The following chart highlights the tax incidence in case of different persons:
| Nature of income
|Income which accrues or arises in India
|Income which is deemed to accrue or arise in India
|Income which is received in India
|Income which is deemed to be received in India;
|Income accruing outside India from a business controlled from India or from a profession set up in India
|Income other than above (i.e., income which has no relation with India)
- (*) ROR means resident and ordinarily resident.
- RNOR means resident but not ordinarily resident.
- NR means non-resident.
of the Income-tax Act has classified the income of a taxpayer under five different heads of income, viz.:
- Income from house property
- Profits and gains of business or profession
- Capital gains
- Income from other sources
Deductions under Chapter VIA of IT act provide certain deductions which can be claimed from Gross Total Income (GTI). After claiming these deductions from GTI, the income remaining is called as Total Income. In other words, GTI less Deductions (under section 80C to 80U) = Total Income (TI). Total income can also be understood as taxable income.
FAQ's on Salary Income
No, you cannot claim deduction of personal expenses while computing the taxable income.
While computing income under various heads, deduction can be claimed only for those expenses which are provided under the Income-tax Act.
Section 17(1) of the Income-tax Act defines the term ‘salary’. However, not going into the technical definition, generally whatever is received by an employee from an employer in cash, kind or as a facility [perquisite] is considered as salary.
Allowances are fixed periodic amounts, apart from salary, which are paid by an employer for the purpose of meeting some particular requirements of the employee. E.g., Tiffin allowance, transport allowance, uniform allowance, etc.
There are generally three types of allowances for the purpose of Income-tax Act - taxable allowances, fully exempted allowances and partially exempted allowances.
FAQ's on Tax audit
Form-16 is a certificate of TDS. In your case it will not apply. However, your employer must issue a salary statement.
The audit under section 44AB aims to ascertain the compliance of various provisions of the Income-tax Law and the fulfillment of other requirements of the Income-tax Law is called tax audit.
The report of tax audit is to be given by the chartered accountant in Form Nos. 3CA/3CB and 3CD.
- A person carrying on business, if his total sales, turnover or gross receipts (as the case may be) in business for the year exceed or exceeds Rs. 1 crore.
- A person carrying on profession, if his gross receipts in profession for the year exceed Rs. 25 lakhs.
- A person who is eligible to opt for the presumptive taxation scheme of section 44AD (*), sections 44AE and section 44BB but he does not opt for the same and claims the profits or gains for such business to be lower than the profits and gains computed as per the presumptive taxation scheme of section 44AD and his income exceeds the amount which is not chargeable to tax.
FAQ's on Tax Deducted at Source (TDS)
A person covered by section 44AB should get his accounts audited and should obtain the audit report on or before the due date of filing of the return of income, i.e., on or before 30th September (extended to 30th November) of the relevant assessment year.
"Tax Deducted at Source", commonly known as TDS is a system in which tax is deducted at the origin of the income. Tax is deducted by the payer and is remitted to the Government by the payer on behalf of the payee.
In respect of various items liable to TDS, the Income-tax Law has prescribed a threshold limit. If the expenditure incurred/payment made during the year is below the threshold limit, then there is no requirement to deduct tax at source.
FAQ's on Permanent Account Number
A payee can approach to the payer for non-deduction of tax at source but for that they have to furnish a declaration in Form No. 15G/15H, as the case may be, to the payer to the effect that the tax on his estimated total income of the previous year after including the income on which tax is to be deducted will be nil.
PAN stands for Permanent Account Number. PAN is a ten-digit unique alphanumeric number issued by the Income Tax Department. PAN is issued in the form of a laminated plastic card (commonly known as PAN card). Given below is an illustrative PAN: ALWPG5809L
A person wishing to obtain PAN can apply for PAN by submitting the PAN application form (Form 49A/49AA) along with the related documents and prescribed fees at the PAN application center of UTIITSL or NSDL. PAN application form (i.e. 49A/49AA) can be downloaded from www.incometaxindia.gov.in
FAQ's on TAN
A Permanent Account Number has been made compulsory for every transaction with the Income-tax Department. It is also mandatory for numerous other financial transactions such as opening of bank accounts, availing of institutional financial credits, purchase of high-end consumer items, foreign travel, transaction of immovable properties, dealing in securities, etc.
TAN i.e. Tax Deduction and Collection Account Number is a 10 digit alpha numeric number required to be obtained by all persons who are responsible for deducting tax at source or collecting tax at source.
There are two modes for applying for TAN: (1) Online mode and (ii) Offline mode, they are as follows:
ONLINE MODE - Online application for TAN can be made from the NSDL-TIN website.
Addresses of the TIN FC are available at www.incometaxindia.gov.in or https://www.tin-nsdl.com.
OFFLINE MODE - An application for allotment of TAN is to be filed in Form 49B in duplicate and submitted to any TIN Facilitation Centre’s (TIN-FC). Addresses of TIN-FCs are available at NSDL-TIN website (https://www.tin-nsdl.com).
FAQ's on MCA
Yes. In such a case, the name and location of branch or the designation of the person responsible for deducting/collecting tax, whichever is applicable, should be clearly given in the application for allotment of TAN
YAn e-form is the electronic equivalent of the paper form. The Ministry of Corporate Affairs has recently launched a major e-governance initiative MCA 21. In the new system, it is envisaged that all company related documents would be filed electronically. The new e-forms have been devised and notified by the Ministry for this purpose.
Digital Signature Certificates (DSC) are the digital equivalent (that is electronic format) of physical or paper certificates. Examples of physical certificates are drivers' licenses, passports or membership cards. Certificates serve as proof of identity of an individual for a certain purpose; for example, a driver's license identifies someone who can legally drive in a particular country. Likewise, a digital certificate can be presented electronically to prove your identity, to access information or services on the Internet or to sign certain documents digitally.
FAQ's on ACES-Service Tax & Excise
Physical documents are signed manually, similarly, electronic documents, for example e-forms are required to be signed digitally using a Digital Signature Certificate.
Service Tax is a tax levied by Central Government of India on services provided or to be provided excluding services covered under negative list and considering the Place of Provision of Services Rules, 2012 and collected as per Point of Taxation Rules, 2011 from the person liable to pay service tax.
Assessee registered with ACES application and with department (Central Excise/Service Tax) can access the online facility to file returns that match their profile (ER-1 / ER-3 / ER-4 / ER-5 / ER-6 / Dealer return OR ST-3) and submit the same to the system.
You can file your returns online after logging into ACES using your user-id and password. You can also prepare your return off-line using Excel Downloadable Utility and then upload the .XML file so generated.
You can revise your ST-3 return once within 90 days from the date of filing the original return, through RET > Fill ST3 > Revise ST-3. Please ensure that in the revised return at A1 you select No for 'Original Return' option and Yes for 'Revised Return' option.