All you need to know about filing Income Tax Returns
July, 29th 2021
It’s that time of year when salaried class should focus on filing their Income Tax Returns. The due date for filing the returns which would normally be July 31, 2021 has been extended to September 30, 2021 due to the COVID-19 pandemic. The return pertains to the financial year 2020-21 and assessment year 2021-22. Here is all that you need to know.
How can one file the returns?
One of the simplest ways is through the New Income Tax portal, which has enabled a JSON utility to file the returns. If a taxpayer downloads the utility and fills the form, they will be able to file the Income Tax Returns. The utility will assist the Assessee by pre-filling the information already available to it. The taxpayer needs to confirm if that information is correct and can proceed to disclose other incomes if any.
What are the key things to keep in mind while filing returns?
The key thing is to ensure complete disclosure of information of your income. Often salaried persons try to file returns purely based on their Form 16. Chances are that they may miss information like interest incomes, transactions in share market and other critical information which are required to be disclosed while filing the return.
Abhishek Murali, Chairman, Direct Taxes Committee, Southern India Regional Council of Institute of Chartered Accountants of India said such transactions are now easily tracked and notices are issued for non-disclosure.
What are the factors to keep in mind?
There are different sets for income tax return forms. Normally salaried assessees file their returns under ITR 1 or ITR 2 forms. ITR 1 is for people with income of up to ₹50 lakh, one house property and income. However, if the person owns more than one house or the house is co-owned they will need to file ITR 2. The taxpayers should choose the correct form applicable to them, as the department will treat the incorrect form filed as an invalid return even if the Income details are correct.
There are complaints about glitches on the new income tax website. What should a taxpayer do when he faces difficulty while filing a return?
Everyday progress has been made in resolving the technical issues. If any person is facing any glitch or difficulty, the first advice would be to wait a day and try it again. Owing to the magnitude or work involved, some functionalities get temporarily disabled and subsequently get improved and enabled. If, even after a 24-hour wait, it continues to show the glitch, it is advisable to raise a grievance on the Income Tax Portal detailing the specific nature of the issue faced, with a screenshot. The National Website Development team will ensure it is taken up in a speedy manner and resolved.
What are the penal actions involved?
The penalty on under-reporting is 50% of the tax payable on the under reported income. However, where there is a mis-reporting of the income or deliberate mis-reporting the penalty will be 200% of the tax payable on the under reported income. Also, if tax payable is ₹1 lakh or more and if a self-assessment tax is not paid by July 31, 2021, an interest would be levied. However, Mr. Murali said representations have been made to defer the interest levy due to Income Tax website glitches and delays in filing tax deducted at source forms by employers, amid the COVID-19 pandemic.