Filing ITR helps in ensuring compliance with the Income Tax Act and entities one to report their income accurately, avail tax benefits, and fulfill their tax obligations. Failure to file ITR or filing incorrect information may result in penalties or legal repercussions.
ADVANTAGES OF ITR FILING
The Income Tax Department states the requirement of the following advantages to file yearly IT returns:
Explore More Services
Got needs? We're all ears
and ready to help!
Click Now! 👉
RESPONSIBILITY OF EVERY PERSON
Filing ITR is a responsibility for many; exemptions is applicable for some catagories but others must file and pay taxes on time.
SMOOTH PROCESSING OF APPLICATIONs
Timely ITR helps obtain loans/visas, serves as income proof; absence may cause difficulties in such applications.
NO PENALTIES
Non-filing of ITR attracts penalties i.e. minimum Rs. 5,000, plus interest under section 234A, resulting in unnecessary expenses.
CARRY FORWARD OF LOSSES
Filing ITR allows carrying forward capital losses for future adjustments against capital gains, thereby maximizing tax benefits.
CREDIBILITY
Timely ITR submission demonstrates responsible nature, strong financial record, establishes credibility, and positive reputation.
CLAIMING OF REFUND
Timely ITR filing is required to claim refund for excess taxes paid through TDS/advance tax, ensuring timely receipt of overpaid taxes
Frequently Asked Questions
Still need help? Get Help Now!
1. Unable to claim benefits U/S 80 TTA/TTB not enabled in Chapter VI A?
Answer: The deduction u/s 80 TTA and 80 TTB will be applicable as per the DOB/Residential status entered in the Personal Information sheet. This deduction shall be allowed only if the income has been offered in "Interest from Savings Bank" or/and "Interest from Deposits (Bank/Post Office/Co-Operative Society) in Schedule OS in Return. For more information refer to instructions for limits on Amount of Deductions as per'Income Tax Act'.
2. Taxpayer is Unable to claim benefits U/S 80 CCD (2)?
Answer: To claim the benefits u/s 80 CCD (2), kindly select the appropriate option in the utility under 'PART (A) General Information/Personal Info tab > Select 'Nature of employment' in ITR1 & ITR4 and in Schedule Salary in ITR2 & ITR3 to proceed further. The deduction under this section shall be limited to 10% of "Net salary - Value of perquisites as per Section 17(2)"
3. Unable to claim the whole donation amount claimed in 'Donation in cash' in 80G sec?
Answer: Deduction u/s 80G shall auto-populate from Schedule 80G provided in the utilities. To claim the same user needs to fill Schedule 80G. Moreover the limit for Donations in Cash is Rs. 2000/- (Two thousand Rupees only), so if, the amount in Donation in Cash exceeds Rs.2, 000 the same is not eligible for deduction. If you have paid donations in other modes kindly enter the details in appropriate cells for claiming eligible amount of donation in returns of income for A.Y2019-20.
4. Invalid Aadhar OTP while entering to e-verify the income tax return?
Answer: You are requested to retry after sometime by generating the fresh Aadhar OTP and proceed further. Or Kindly contact the UIDAI Helpdesk at 1947 for Aadhar OTP related issues. Alternatively, you may e-Verify the income tax return through options given below: Login to e-Filing through Net Banking EVC through pre-validating Bank Account EVC through pre-validating Demat Account EVC through Bank ATM For more information, kindly go through the HELP option provided in e-Filing website www.incometaxindiaefiling.gov.in. Help> Taxpayer > e-Verification > e-Verification options.
5. Are you unable to Link Aadhar with PAN due to profile mismatch and unable to file the income tax return?
Answer :The mentioning the valid 12 digit Aadhar number/ 28 digit Enrolment ID [for those who are yet to get Aadhar but enrolled] in the ITR form is made mandatory for filing of returns. If you have obtained AADHAAR then kindly enter the 12digit AADHAAR number in the ITR. If you have not obtained AADHAAR then kindly enter the 28 digit Enrolment ID in the ITR.
6. I have made the tax payments successfully and still the pending tax is showing in Tax Paid Verification sheet?
Answer :You are requested to enter the e-Pay tax payment details (BSR Code, Challan Details etc) manually while filing the income tax return in 'Tax Details' sheet under 'Sch IT - Details of Advance tax and self-assessment tax payments' and proceed further.
7. Unable to Generate XML ITR through Java software error states "Please enter the Date of Filing"?
Answer: Date of Filing need to be entered in CFL Schedule of ITR for successful generation of XML
8. In schedule TR filed Taxpayer Identification Number is not matching with taxpayer identification Number entered in schedule FSI?
Answer: Kindly download latest ITR software and proceed further
WHO SHOULD FILE ITR?
The Income Tax Department states the requirement of the following assessee to file yearly IT returns:
Salaried individual
If your gross income exceeds the exemption limit before deductions under Sections 80C to 80U, then you must file an ITR return.
What is Form 16 ?
Form 16 is a certificate that contains details of the salary earned by an employee and the TDS duducted by the employer.
If the salary income exceeds the basic excemption limit , The employer is required to deduct TDS on salary at the time of making the payment and deposit the same with the government within the due date.
The employee receives this form annually from their company to include with their tax return.
Form 16 has two parts :
Part A contains the names, addresses, PAN numbers, TAN numbers of both employer and employee, tax deducted and deposited.
Part B specifies the employee's allowances, perquisites, other benefits and deductions allowed under Income Tax Act.
Non individual
Every firm, whether it's a private limited, LLP, or partnership, is required to file IT returns, regardless of whether it made a profit or loss.
Director/Partner
Individuals who are Directors in a Private Limited Company or a Partner in a Limited Liability Partnership firm are also required to file IT returns.
Having Income from other sources
you earn dividends from mutual funds, bonds, equities, fixed deposits, interest, or other sources, then you must file an IT return.
Income from charity or voluntary contributions
you receive income through charity or religious trusts, as well as income from voluntary contributions, then you are required to file IT returns.
Foreign income
NRIs and tech professionals on onsite deputation, as well as anyone with foreign income or assets, are required to file IT returns.
Other situations where it is mandatory to file ITR
If you have deposited an amount exceeding Rs.1 crore in one or more current accounts during the financial year
If you are seeking tax refunds, whether you are an individual or a business, then you must file IT returns.
If you have paid an electricity bill exceeding Rs. 1 crore in a single bill or on an aggregate basis during the financial year.
If you have spent Rs. 12 lakh or more on foreign country travel.
If you hold any asset outside India or have signing authority in any foreign account.
If your total sales or turnover in a business is Rs 60 lakhs or more during the financial year.
It is always advisable to file ITR even if you are not required to do so, as it helps in building a good credit history and may be required as proof of income in various situations like availing loans, obtaining visas, etc.
Consequences of Not Filing ITR within the deadline
Failing to submit your tax return within the deadline can lead to a number of unfavorable circumstances:
If you fail to file your ITR within the due date, you may have to pay a late filing fee of up to Rs. 10,000 depending on the delay in filing.
You will not be able to offset any losses other than those arising from property loss against future gains. This can lead to an increase in your overall tax liability.
You will also be charged interest under Section 234A at a rate of 1% per month or part of a month on any outstanding tax due until payment is made. It's important to remember that you can't file your ITR unless you've paid your taxes in full, and the longer you delay, the more interest you'll accrue.
If you're entitled to receive a refund for excess taxes paid, filing your returns before the deadline will ensure that you receive your refund sooner. However, if you miss the income tax filing deadline, your refund may be delayed, causing further inconvenience. You will not receive your refund untill you file the ITR.
Legal consequences :
The income tax officer may start prosecution proceedings against you if you intentionally refuse to file a return, despite receiving reminders. If convicted, you could be imprisoned for up to two years, and fined up to 50% of your due tax. The period of prosecution could even extend to seven years if you owe a significant sum to the department.
Therefore, in a nutshell, timely filing of your ITR not only ensures that you meet your legal obligations, but it also safeguards you against unwanted legal and financial consequences.
WHO SHOULD FILE ITR?
The Income Tax Department states the requirement of the following assessee to file yearly IT returns:
Salaried individual
If your gross income exceeds the exemption limit before deductions under Sections 80C to 80U, then you must file an ITR return.
What is Form 16 ?
Form 16 is a certificate that contains details of the salary earned by an employee and the TDS duducted by the employer.
If the salary income exceeds the basic excemption limit , The employer is required to deduct TDS on salary at the time of making the payment and deposit the same with the government within the due date.
The employee receives this form annually from their company to include with their tax return.
Form 16 has two parts :
Part A contains the names, addresses, PAN numbers, TAN numbers of both employer and employee, tax deducted and deposited.
Part B specifies the employee's allowances, perquisites, other benefits and deductions allowed under Income Tax Act.
Non individual
Every firm, whether it's a private limited, LLP, or partnership, is required to file IT returns, regardless of whether it made a profit or loss.
Director/Partner
Individuals who are Directors in a Private Limited Company or a Partner in a Limited Liability Partnership firm are also required to file IT returns.
Having Income from other sources
you earn dividends from mutual funds, bonds, equities, fixed deposits, interest, or other sources, then you must file an IT return.
Income from charity or voluntary contributions
you receive income through charity or religious trusts, as well as income from voluntary contributions, then you are required to file IT returns.
Foreign income
NRIs and tech professionals on onsite deputation, as well as anyone with foreign income or assets, are required to file IT returns.
Other situations where it is mandatory to file ITR
If you have deposited an amount exceeding Rs.1 crore in one or more current accounts during the financial year
If you are seeking tax refunds, whether you are an individual or a business, then you must file IT returns.
If you have paid an electricity bill exceeding Rs. 1 crore in a single bill or on an aggregate basis during the financial year.
If you have spent Rs. 12 lakh or more on foreign country travel.
If you hold any asset outside India or have signing authority in any foreign account.
If your total sales or turnover in a business is Rs 60 lakhs or more during the financial year.
It is always advisable to file ITR even if you are not required to do so, as it helps in building a good credit history and may be required as proof of income in various situations like availing loans, obtaining visas, etc.
Consequences of Not Filing ITR within the deadline
Failing to submit your tax return within the deadline can lead to a number of unfavorable circumstances:
If you fail to file your ITR within the due date, you may have to pay a late filing fee of up to Rs. 10,000 depending on the delay in filing.
You will not be able to offset any losses other than those arising from property loss against future gains. This can lead to an increase in your overall tax liability.
You will also be charged interest under Section 234A at a rate of 1% per month or part of a month on any outstanding tax due until payment is made. It's important to remember that you can't file your ITR unless you've paid your taxes in full, and the longer you delay, the more interest you'll accrue.
If you're entitled to receive a refund for excess taxes paid, filing your returns before the deadline will ensure that you receive your refund sooner. However, if you miss the income tax filing deadline, your refund may be delayed, causing further inconvenience. You will not receive your refund untill you file the ITR.
Legal consequences :
The income tax officer may start prosecution proceedings against you if you intentionally refuse to file a return, despite receiving reminders. If convicted, you could be imprisoned for up to two years, and fined up to 50% of your due tax. The period of prosecution could even extend to seven years if you owe a significant sum to the department.
Therefore, in a nutshell, timely filing of your ITR not only ensures that you meet your legal obligations, but it also safeguards you against unwanted legal and financial consequences.