ITR of Salaried Person

ITR of Salaried Person

ITR stands for Income Tax Return. Every salaried person with an income of more than Rs. 2,50,000 is required to file there ITR with the Income Tax Authority in Form ITR-1.

ELIGIBILITY OF FILING OF ITR FOR SALARY CLASS PERSON

A salaried employee, for income tax purposes, is a person who receives a salary from an employer for providing services under a contract of employment. The income may include salary, perquisites, allowances, and other benefits. The salaried employee is liable to pay income tax on the income earned from such employment after deducting the deductions and exemptions under the Income Tax Act 1961. The salaried employee is required to file an income tax return every year and the reporting in the income tax Return the details of income, deductions, taxes paid, and refund claimed, if any.

THE BASIC EXEMPTION LIMITS FOR FY 2022-23 AND FY 2023-24

Individuals which annual income of Rs. 3,00,000 or higher are required to file their Income Tax Returns (ITR) under the new tax regime irrespective of their age

TAX SLAB RATES FOR FY 2023-24 UNDER THE NEW REGIME.

For Individuals below 60 years of age –

For Senior Citizens (60-80 years of age) –

For Super Senior Citizens (Aged > 80 years) –

WHAT ARE THE REQUIRED DOCUMENTS FOR A SALARIED PERSON TO FILE AN ITR?

You need to collect all the documents that are relevant to your income tax filing. These include Form 16 (TDS certificate) and any other documents that show your income, deductions, and exemptions. However, if you don’t have Form 16, you can still compute your income using other documents like salary slips, bank statements, and investment statements.

You can also get information about your TDS and TCS from Form 26AS, which is available on TRACES through the Income Tax Portal.) Keep Form 16A, Exemptions under Section 80D and 80U, and Capital gains statement handy if applicable.

WHAT HAPPENS IF MY TAXABLE INCOME IS LESS THAN THE BASIC EXEMPTION LIMIT?

As per the Income Tax Act of India, individuals are required to file an ITR only if their annual income exceeds the basic exemption limit. However, there are certain conditions in which you might be required to file an ITR even if your income falls within the basic exemption limit. Given below is a list of such conditions –

Bank Deposits of more than 50 lakhs – If the individual having total annual savings bank deposit in one or more accounts exceeds Rs.50 lakhs, then, such individual shall required to file Income tax Return (ITR).

Current Account Deposits of more than Rs. 1 Crore – If an individual deposits Rs.1 crore or more in one or more current accounts during the financial year, then such individual shall require to file must file an ITR.

Annual Sales Turnover above Rs.60 lakhs – Individuals having an annual sales turnover of more than Rs.60 lakh are required to file an ITR.

Professional income above Rs.10 lakh – If the professional income exceeds Rs.10 lakhs during a financial year, then he/she has to file an ITR.

Electricity Bill Exceeding Rs. 1 Lakh – If an individual’s electricity bill during the year exceeds Rs.1 lakhs, he/she is required to file an ITR.

TDS/TCS exceeding Rs.25,000 – If the TDS/TCS of a person is more than Rs.25,000, ITR filing is mandatory. However, this threshold is Rs.50,000 for senior citizens.

Income from foreign assets – If an individual has an asset in a foreign country or is a beneficiary of an asset in a foreign country, he/she must file an ITR.

Expenses on foreign travel: If an individual spends Rs. 2 lakh or more on foreign travel for himself or for another person during the financial year, then, such an individual has to file an ITR.

What are the benefits of ITR filing?

Easy Loan Approval: When applying for loans, banks often ask for your ITR, as it acts as proof of your income. Therefore, filing an ITR makes it easier for you to get your loans approved.

Claiming Tax Refund – There can be instances where TDS might have been deducted from your income, even if your income falls below the basic exemption limit or the TDS deducted exceeds your actual tax liability. In such cases, you can claim a tax refund while filing your ITR.

Acts as Income and Address Proof – Your income tax return acts as proof of your income and investment for various banks and financial institutions.

Quick Visa Processing – Most embassies require you to submit your income tax returns from the previous years while applying for a visa. Therefore, filing an ITR can actually help speed up your visa processing.

Carry Forward of Losses – The Income Tax Act allows individuals to carry forward their previous year’s losses. These losses can be offset against future income. However, this benefit is only available if you file your ITR within the prescribed timeline.

Helps Buying Term Insurance Insurance providers often require individuals to submit their income tax returns as proof of their income. The total coverage amount is determined based on the individual’s earnings.

Claim Refund of Excess Tax Payments: If your income is below the threshold limit but TDS has been deducted from income such as fixed deposit, salary, or interest income,. In such cases, you can claim a refund of the same while filing your ITR.

External Government Website Link

MCA | INCOME TAX| SEBI 

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