What is ITR? Which ITR should you File? Types of ITR, How to file ITR? Income Tax Returns e-filing – ITR forms for FY 2021-22, AY 2022-23
ITR is denoted as Income Tax returns. Income tax act 1961 controls all the forms of ITR and functions/operations to be done correctly. This article will give you in-depth details of the ITR, its types, and how you can file your tax return. We have covered everything that you must know before diving into It. Let's understand ITR step by step.
What is ITR?
ITR (Income Tax Return) is a form that taxpayers are believed to submit to the Income Tax Department of India. In this form, All information related to the taxpayer’s yearly income and the whole amount of tax to be paid is mentioned along with a refund that needs to be credited for that specific year. The Department of income tax has announced seven types of forms to date. The Relevancy of these ITR forms differs on the basis of earned income, source of the income of tax-payer, and category of income. We have mentioned all seven ITR forms below with details.
Types of ITR
This ITR form is also called Sahaj and it must be filled out only by the residential individuals' taxpayers. There are certain conditions to fill out this ITR form which are mentioned below.
- If an individual does not have any income source from another country or does not have any property outside of the country.
- If an individual is receiving his income in the form of a pension or salary.
- If the earned income in agriculture is less than Rs. 5000.
- If an individual’s total income is not crossed Rs. 50 lakhs.
- The individual should not be a director of any company.
- If the individual is not having foreign assets or property.
ITR-2 Form can be used by the (HUF) Hindu undivided family or any individual taxpayer. There are almost the same conditions to fill out the ITR-2 form as the ITR-1 form. Details are given below.
- There are minor differences in ITR-2 Form than ITR-1. The total income of the individual taxpayers should be more than 50 lakhs when received through the house property, pension, lottery, or any other activity.
- If the individual’s income earned through agriculture is more than Rs. 5000. That individual is eligible to fill out ITR-2.
The newly ITR-3 form is for both an individual taxpayer and (HUF) Hindu undivided family whose source of income is business and profession. Following are the eligibility criteria.
- When an individual earns income through profit, a commission
- When you are the director of a company.
- If Your income is through the partnership of any firm.
- If any individual taxpayer made investments in the unlisted shares during the financial year.
This ITR-4 is used by the individual, (HUF) Hindu undivided family or partnership firms. ITR-4 is also named Sugam. Eligibility is mentioned below to fill out the form ITR-4.
- If any individual is getting income through the business as per the income scheme under sections 44AD and 44AE.
- When an individual’s income is through the profession as per the presumptive income scheme under section 44AD.
- If the income is from house property but is not more than Rs.50 lakh.
- When an individual wants to fetch his income on a presumptive basis then it is taken as a presumptive scheme under sections 44AD, 44AE, and 44ADA.
The ITR-5 form was introduced for the AOPs (Association of Person), LLPs (Limited Liability Partnership), BOIs (Body of individuals), AJP ( Artificial Juridical Person), Investment funds, and Business trust, and local authorities. As per the reference in section 2(31)(vii), this form is for the person who belongs to a firm, AOP, BOI, LLP, artificial juridical person, business trust and investment fund, or local authority. ITR-5 should not be used by the person who has to file the income return under sections 139(4A), 139(4B), 139(4C), and 139(4D).
ITR-6 is for Those companies who do not claim an exemption under section 11(Income from property held for charitable or religious purposes). ITR-6 Form is to be filled out by the companies who do not claim tax exemption on their income under section 11 of the income tax act. This tax return must be filled only by electronic methods.
Those AOPs (Association of Person), LLPs (Limited Liability Partnership), BOIs (Body of individuals), AJP ( Artificial Juridical Person), Firms and Companies have to file income tax returns through the ITR-7, If their claim exemption is under the following details.
- If their income comes from the religious and charitable trust Under section 139(4A).
- If they are getting income from political sources under section 139 (4B).
- If their income is through scientific research under section 139 (4C).
- If they are having income from the university or colleges under section 139 (4D).
Taxpayers who are not claiming exemption under Section 139 (4A), Section 139 (4B), Section 139 (4C) or Section 139 (4D) are not eligible to provide ITR-7 form for Income Tax Return.
Why should one file ITR?
Filing income tax returns is mandatory in India If any of the following conditions are pertinent to you.
- If any individual willingly wants to claim An income tax refund from the department.
- If the individual is looking for a visa, a loan or to apply for a visa.
- If your income or wealth gains are from foreign assets during the financial year.
- Irrespective of loss and profit every taxpayer company or firm must file an income tax return.
- If an individual’s income exceeds more than the basic exemption limit as mentioned below-
- Rs. 2.5 lakh For those individuals who are below 60 years of age.
- Rs. 3.0 lakh for those individuals who are between the age of 60 to 80 years.
- Rs. 5.0 lakh for those individuals who are above 80 years of age.
However, those individuals are also eligible for income tax returns whose income is below the exemption limit and if they meet with following criteria stated below.
- Those individuals who have spent or incurred the expenditure of more than 2 lakh for anyone or self on foreign travel.
- Those individuals who have spent or aggregate expenditure of additionally more than 1 lakh for electricity consumption.
- Those individuals who have deposited amounts of more than Rs. 1 crore in bank accounts.
Types of forms to file ITR?
Form-16 is used as proof of filing income tax returns by the employer to the government. The form-16 is an income tax form for companies, firms, and unorganized corporations to give their employees details about the deducted tax. This form contains all the details like net salary, HRA and LTA exemptions, gross taxable salary, tax-saving deductions, salary TDS, and any loss that happened with the employee.
Form-26AS is a compact annual tax statement that contains information about tax deducted or collected at the source and TDS on various salaries, interest, self-assessment, and advances tax. The Budget for 2020-21 had declared the modified Form 26AS providing a more comprehensive profile of the taxpayer going further the details of tax organized and deducted at source. In the month of May, the Income Tax Department announced the new annual report in Form 26AS.
Proceeding above the components of tax removed or collected at source, the revised Form 26AS will reminisce every detail provided by banks and financial institutions, which were prematurely documented in their Statement of Financial Transactions.
Form-15G and 15H
Form-15G or 15H helps individuals receive income without the tax deducted at the source. If your net taxable income is below the basic exemption limit and ages under 60 years then you can fill out the form-15 and submit it. If you are a senior citizen and the tax exists is zero on your net revenue earned from profit or gross income then you need to fill out the form-15H. An individual has to submit both of the forms to his employer. Individuals whose total income is below the tax limitation can save tax deducted at source on interest by presenting form-15G or form-15H.
Difference between form-15H and 15G
(HUF) Hindu Undivided families and Indian residents less than 60 years of age are qualified for form 15G.
Indian citizens aged 60 years or above are eligible for form-15H.
Employees can Utilize form 15G for non-deduction of TDS on Employers’ PF Withdrawal, interest from post office deposits, interest income from bank deposits, interest from rental income, from a life insurance policy, interest from the corporate bond.
Form-15H can be used for claiming non-deduction of TDS on the interest generated from fixed pledges, corporate bonds, post office, and EPF withdrawal.
Form-15G enables individuals who are below 60 years to TDS deductions from interest income in a financial year.
This form helps the individuals who are above 60 years can save TDS deductions from interest income in a financial year.
Form-15G is allocated against an FD holder who is below 60 years.
Form-15H is allocated against the FD holder and RD holder who is aged 60 years or above.
Form 15G is provided by the Income Tax Department and all banks of India issue.
Form 15H is provided by the Income Tax Department and all banks of India to issue.
validity of form-15G has been expanded from 31st June 2021 to 30th March 2021.
The validity of the form-15H has been expanded from 31st June 2021 to 30th March 2021.
The verification rate can be done through the e-filing portal.
The verification rate can be accomplished through the e-filing portal.
How to file ITR?
Before proceeding further, We should make sure that we have all these valid documents which are PAN, Aadhaar, Bank account details, investment details, and Form-16.
Following are the steps -
- First login to the myitronline account. If you have the form-16 then click on the “upload form-16 PDF” but in case you do not have this form in PDF format then press on continue.
- Fill out personal details such as PAN, date of birth, and Name as mentioned on PAN. Name of the father, and address.
- Fill out the details about your salary, profession, or employer type and name along with TDS information.
- Enter the details of investment for claiming the deduction.
- Fill in the details of taxes paid. You can fill in these details by uploading the form-26AS along with the self-assessment tax paid in a relevant financial year.
- Feed the details of your bank account and go ahead for e-filing and click on proceed to e-filing. If you notice any option of ‘Refund’ or ‘No Tax Due’, Click on proceed to e-Filing. You will get a declaration number on the next screen.
- Lastly, Click on the e-verify income tax return when your return is filed.
Frequently Asked Questions-
Who needs to file ITR?
According to the regulations of income tax laws, any individual who is earning more than 2,50,000 to 5,00,000 lakh is mandated to pay the tax returns. It helps the Government to operate financial sectors more efficiently.
Is it mandatory to file ITR?
Yes. Filing Income Tax returns is mandatory for all registered taxpayers and any individual who is earning more than 2,50,000 to 5,00,000 lakh is mandated to pay the tax returns.
Who is exempted from ITR?
Those registered taxpayers whose net income is below the exemption limit of Rs.2 .5 lakh, don't have to file ITR by using the ITR-1 form.
What is the minimum income to file ITR?
The minimum income to file ITR should be up to 2.5 lakh as per the financial year of 2021-22.
Should I file ITR if my income is less than 5 lakh?
Yes. You have to file ITR even though your income is less than 5 lakh.
Do salaried employees need to file ITR?
Yes. Salaried employees whose income is up to 5 lakh must file an income tax return with the ITR-1 form.
What happens if I don't file ITR?
In case you are unable to file ITR. It can lead to penalties or imprisonment of 3 months to 2 years.
Is ITR mandatory for government employees?
No. As per the rule of income tax, It is not compulsory to file income tax returns for government employees if their income is less than the taxable limit.
From where can you download these ITR forms?
You can download ITR forms from the website of Income Tax.
Is Form 15H unrestricted for (HUF) Hindu Undivided Family?
No. (HUF) or Hindu undivided families can not fill out the form-15. This form is not functional for HUF.
How to link PAN to Aadhaar?
There are two simple methods to link your PAN to Aadhaar. You can do it by e-filing login on the income tax portal.
How to apply for the PAN card?
You can apply for the PAN card through the online method. This procedure is easy and convenient. You just need to fill out the valid information and submit the required documents.
https://tin.tin.nsdl.com/pantan/StatusTrack.html. You can visit this website to submit the application online.
How do I check my ITR status?
Any individual can check their ITR status on the following website. You will need your PAN details and ITR declaration number.
What is the late fee for filing ITR with a due date?
The late fee for filing ITR is Rs. 5000 with the due date before the 31st of December 2020. However, the late fee for return filing is Rs.1000 which should not exceed more than this if the net income of the individual is below Rs.5 lakh.
Can I file an ITR in the case of a loss in business, house property, or sale of shares?
Yes. you have to file ITR even though the loss of business or interest is paid on the home loan. Make sure to file ITR before the last date.