Mistakes while filing ITR

What do you mean by income tax?

Income tax is a tax levied and collected by the Central Government on income of a person which is calculated at specified rates on the total income of a person and paid directly to the Central Government.

And,

An income tax return is a form or document where the citizens declare their taxable income, deductions as per norms, and tax payments. The undergoing whole process is termed as ITR Filing.


filing ITR

What are the basic and most common mistakes people make while filing ITR?

  • Mistakes in filling basic details – People generally make mistakes while writing their name, PAN card details, their associated bank account numbers, respective address or their basic details which results in rejection of their returns or delays.
  • Filing using incorrect forms – Almost every time there are made some changes to the respective forms. So, people file ITR using wrong forms which are then resulted as defective.
  • Not filing/Forgot to file ITR returns – People generally forgets or are in doubt to file their returns. But, do remember if your total gross income is up to Rs. 2.5 lakhs, then you have to file an ITR return.
  • Forgets to report all interest incomes – People must report/write all the interest incomes he/she is received for the year which can include all the saving bank account, his/her fixed deposits and other recurring deposits, etc.
  • Fails to combine the incomes – People generally fail to combine incomes of his family including his own, his wife, his children and combining that income to his income which then gets the total taxable income.
  • Failing to report income from his previous job – Job change is quite frequent these days. And people also quite often fails to report the income earned through previous job along with his present job, then occurs a discrepancy on TDS.
  • Not reporting incomes even it is tax free – It is your duty to report every income you have even if it is earned through your provident funds or your tax free bonds in a single year.
  • Failing to report all bank accounts – Every year, it is required for the person to report every single bank account to be reported in the forms. Failing to which, these should be charged as defective.
  • Not declaring any type of rent – If you have any other property/house apart from the one in which you are living, then you should report the expected rent in your total income area of the form.

For further information and help related to filing ITR feel free to get in touch with Trutax.in

For any inquiry call us +91 98 91 200793 or email us care@trutax.in

What is ITR-1 and how do I file my ITR-1 Form?

ITR-1What is ITR form?

Income Tax Return Forms are the prescribed formats in which a taxpayer has to provide the information about his income, source of such income and income-tax paid or payable to the Income-tax Department.

What is ITR-1?

ITR-1 Form is a simplified one page form for individuals having income up to Rs 50 lakhs from the following sources:

  • Income from Salary/Pension
  • Income from One House Property (excluding cases where loss is brought forward from previous years)
  • Income from Other Sources (excluding winning from Lottery and Income from Race Horses).

How do I file my ITR-1 Form?

You can submit your ITR-1 Form either online or offline.

Offline:

For offline, the return is furnished in a physical paper form.The Income Tax Department will issue you an acknowledgment at the time of submission of your physical paper return.

Online/Electronically:

  • By transmitting the data electronically and then submitting the verification of the return in the form of ITR-V to CPC, Bengaluru.
  • By filing the return online and e-verifying the ITR-V through net banking/aadhar OTP/EVC.

If you submit your ITR-1 Form electronically, the acknowledgment will be sent to your registered email id. You can also download it manually from the income tax website. You are then required to sign it and send it to the Income Tax Department’s CPC office in Bangalore within 120 days of e-filing. Alternatively, you can e-verify your return.

The Major Changes which are made in the ITR 1 for the AY 2018-19 are:

  • Earlier ITR-1 was applicable for both Residents, Residents Not ordinarily resident (RNOR) and also Non-residents. Now in AY 2018-19, this form has been made applicable only for resident individuals.
  • The condition of the individual having income from salaries, one house property, and other income and having total income up to Rs 50 lakhs
  • There is a requirement to furnish a break-up of salary. Until now, these details would appear only in Form 16 and the requirement to disclose them in the return had never arisen.
  • There is also a requirement to furnish a break up of Income under House Property which was earlier mandatory only for ITR -2 and other forms.
  • Apart from these, your Aadhar number and disclosure of all Bank Accounts is mandatory.

For further information and help related to ITR-1 feel free to get in touch with Trutax.in

For any inquiry call us +91 98 91 200793 or email us care@trutax.in

What is ITR how to file ITR 2018?

The government has made several changes in the way Income Tax returns are filed. Apart from making Aadhaar mandatory to file itr 2018, the government has also introduced different itr Forms.

There are up to nine types of income return forms that a taxpayer could use to file his returns, only the following forms are to be taken into consideration by individuals when filing returns,

  • ITR-1
  • ITR-2
  • ITR-2A
  • ITR-3
  • ITR-4
  • ITR-4S

The following income tax return forms are only applicable to companies and firms:

  • ITR-5
  • ITR-6
  • ITR-7

file ITR

ITR-1:

This income tax return form is also called a Sahaj form. The ITR-1 form is to be filed solely by an individual taxpayer. Any other assesses liable to pay tax will not be eligible to avail of this form for the purpose of filing their returns. This form is applicable for the following:

  • Individuals who earn income through salary or through means such as pension
  • Individuals who earn income from a single housing property
  • Individuals who have no income from any other business or who have no income from the sale of any assets i.e.: capital gains
  • Individuals who do not own any assets or property in countries other than India
  • Individuals who do not earn income from any country outside India
  • Individuals whose income from agriculture is below Rs 5,000
  • Individuals who earn income from various investments or sources such as Fixed Deposits, Investments, Shares etc
  • Individuals who have not earned income from any windfall such as lotteries or horse racing
  • Individuals who wish to club the income of their spouse or underage child with their own income, so long as the income to be clubbed is in accordance with the criteria mentioned above

 

The ITR – 1 form is divided into these parts:

* Part A has general information
* Part B has gross total income
* Part C shows deductions and taxable total income
* Part D shows computation of tax payable
* Part E includes all other information
* Schedule IT provides detail of advance tax and self-assessment tax payments
* Schedule TDS provides detail of TDS/TCS

 

For further information and help related to file ITR feel free to get in touch with Trutax.in Our Help line number +91 9891200793 available for small business and start up to grow their business rapidly. For any inquiry call us +91 9891200793 or email us care@trutax.in

How to reduce Taxation and Financial Planning

Taxation and Financial Planning

Taxation and Financial Planning: We know that knowing the tax ramifications of any investment is essential to developing a complete plan for our life.  Without the intimate knowledge of taxation in relation to wealth, it is like running a marathon without shoes.

You may anticipate significant changes in income or expenses based on a change of job or career, or a change of life stage or lifestyle. Not only may the amounts of income or expenses change, but the kinds of incomes or expenses may change as well. Taxation and Financial Planning for those changes in relation to tax obligations is part of personal financial planning.

Obligations change more broadly as your stage of life changes. Although everyone is different, there is a typical pattern to aging, earning, and taxes-

In young adulthood, you rely on income from wages, and you usually have yet to acquire an asset base, so you have little income from interest, dividends, or capital gains. Your family structure does not include dependents, so you have few deductions but also low taxable income.

As you progress in your career, you can expect wages, expenses, and dependents to increase. You are building an asset base by buying a home, possibly saving for your children’s education, or saving for retirement. Because those are the kinds of assets encouraged by the government, they not only build wealth but also create tax advantages—the mortgage interest deduction, retirement, or education savings exemption.

Generally, you can expect your income to increase during your middle adult life, but that is when many people typically have dependents and deductions such as mortgage interest and job-related expenses to offset increased tax obligations. As you age, and especially when you retire, you can expect less income and also fewer deductions: any kids have left home, the mortgage in paid off.

The bigger picture is that at the stages of your life when income is increasing, so are your deductions and exemptions, which tend to decrease as your income decreases. Although your incomes change over your lifetime, you tax obligations change proportionally, so they remain relative to your ability to pay.

The tax consequences of such changes should be anticipated and considered as you evaluate choices for financial strategies. Because the tax code is a matter of law it does change, but because it is also a matter of politics, it changes slowly and only after much public discussion. You can usually be aware of any tax code changes far enough in advance to incorporate them into your Taxation and Financial Planning.

There are two types of taxes in India –

  1. Direct Tax: A direct tax is a tax you pay on your income directly to the government.
  2. Indirect Tax: Indirect tax is a tax that restaurants, theatres and e-commerce websites charge you on for goods or a service. This tax is, in turn, passed down to the government. Indirect taxes take many forms: service tax on restaurant bills and movie tickets, value added tax or VAT on goods such as clothes and electronics.
    Goods and services tax, which has recently been introduced, is a unified tax that has replaced all the indirect taxes that business owners have to deal with.

The Income Tax Department breaks down income into five heads:

S. No  Type of Income  Income covered
1  Income from Salary  income from salary and pension
2  Income from Other Sources  Income from savings bank account interest, fixed deposits, winning Tottery
3  Income from House Property mostly rental income from your house
4  Income from Capital Gains  Income from sale of a capital asset such as mutual funds, shares, house property
5  Income from Business and Profession When you are self-employed, work as a freelancer or contractor or you run a business. Life insurance agents, chartered accountants, doctors and lawyers who have their own practice, tuition teachers etc.

 

 

 

 

 

Tax Slabs

How much tax you should pay depends upon the tax slab applicable to your income. Income tax is calculated on the basis of these tax slabs.

taxpayers under 60 years of age in FY 2018-2019 and FY 2017-2018-

 

Income Slab Tax Rate
Up to Rs.2,50,000 No Tax
Rs.2,50,000 – Rs.5,00,000 5%
Rs.5,00,000 – Rs.10,00,000 20%
Rs.10,00,000 and beyond 30%

 

Income tax calculation:

Income from salary = Basic salary + HRA + Special Allowance + Transport Allowance + any other allowance.

Some components of your salary are exempt from tax, such as,

Medical reimbursements

Telephone bills reimbursement.

If you receive HRA and live on rent, you can claim exemption on HRA.

Transport allowance is given to employees as part of their salary to meet travel expenses from residence to work & back. Starting financial year 2015-16, limit of exemption on transport allowance is 1,600 per month or Rs 19,200 per annum.

For further information and help related to Taxation and Financial Planning feel free to get in touch with Trutax.in Our Help line number +91 9891200793 available for small business and startup to grow their business rapidly.

 

What is Form-16 and how to upload it on the e-filing website?

 

form16

Form-16: Form-16 is a form which is used as a certificate from the employer which validates that the Tax is deducted from the salary and it is submitted to higher authorities. It contains the valid information which is necessary to file your ITR. Form 16 is issued in once a year before 15th June of the immediately following financial year of your tax deducted. Form-16 is divided into two parts which are Part A and Part B. If you lost your form-16 by mistake then you can get another copy of it from your employer who has issued you the form. Both parts include the following information:

Part A: Part A contains the following information:

  1. Full Name and Address of the Employer
  2. TAN and PAN Number of Employer
  3. PAN of the Employee
  4. Summary of tax deducted and deposited quarterly, which is certified by the Employer

Part B: Part B contains the following information:

  1. The detailed breakup of the salary of the employee.
  2. Deductions allowed under the income tax act (under chapter VIA)
  3. Relief under section 89

There are few details required from Form-16 while filing your return. These details are as given below:

  • Taxable Salary of employee
  • The breakup of Section 80C Deductions
  • The aggregate of Section 80C Deductions
  • TDS (Tax Deducted at Source)
  • Tax Payable or Refund Due
  • TAN Number of Employer
  • PAN Number of Employer
  • Name and Address of Employer
  • Current Assessment Year
  • Your (Taxpayer’s) Name and Address
  • Your PAN Number

Upload Form 16 Online: You can upload your Form 16 online it’s very easy simply visit to Online ITR filing website and upload a copy of your Form 16 in the form of PDF or Doc. No need to add anything manually. Just log in to Online ITR filing website and upload it, all the information will be fetched automatically.

For any inquiry call us +91 98 91 200793 or email us care@trutax.in

Guidelines for filing ITR-1 form

ITR-1 Form Filing

Who can file ITR-1?

ITR-1 is applicable to individuals whose total income includes:

  • Income from Salary or Pension.
  • Income from one House Property.
  • Income from other sources excluding winning lottery income and horse racing income.

If you are eligible for filing ITR-1 then sign up on Trutax and file your income tax returns within few minutes:  e-filing ITR-1

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Important Income Tax changes in Budget 2018

Budget 2018

Feb 1, 2018, was the important day for every Indian taxpayer as our Hon’ble Finance Minister announced the budget 2018 and proposed many changes in personal finance. If you pay taxes then you should know about the latest income tax changes which the Government has announced in the Budget 2018.

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Income Tax Deduction

Income Tax Deduction

There is a number of Income Tax Deduction available under Section 80 which taxpayers can consider to save their taxes and plan their finances better for future.  Taxpayers can claim a maximum deduction of Rs. 1.5 lakh under this section to reduce their taxable income in any financial year.  Any individual or Hindu undivided family is eligible for this deduction and save their taxes.

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