Introduction
Income Tax is levied on taxable income earned during previous years at predefined rate, by the Government as per IT act 1961. Income Tax is an annual Tax on income. The India
In India
Important Definition
1) Assessee Sec 2 (7)-:
Means a person responsible for payment of income tax or any other due (as interest or penalties), as per IT act 1961. Therefore it is not necessary that the assessee should have his own income for example –in case of death of a person the legal heir similary in case of foreigner or mad person or child; the representative shall be treated as deemed assessee.
2) Person Sec 2(31):-
Person word includes:- Individual Firm, Hindu undivided family (HUF), Association of Person (AOP), Body of Individual (BOI), Local Bodies (Gram Panchayat, Municipals Corporation etc, Partnership Firm.
3) Previous Year Sec 3:-
The year in which income is earned is known as previous year. The financial year ending on 31st March is called previous year.
4) Assessment Year Sec 2(9):-
It is the period of 12 months beginning from 1st day of April immediately after the previous year.For example previous year ending on 31-03-2007, the Assessment year will be 2007-2008. The Assessee himself makes self assessment of tax on income earned during previous year (2007-2008), and the payment of Tax at the end of Previous year and file returned during assessment year (2008-2009), on the basic of which the income tax authority makes assessment of tax during year 2008-2009, that is why year will be called assessment year for Financial Year 2007-2008.
5) Gross Total Income:-
The sum of Taxable income of all 5 source (i.e Salary, House Property, Business or profession, Capital Gain & other sources) of assessee, after adjustment of losses & clubbing of Income is called 5) Gross Total Income.
Basic Limit of Exemption from income tax
Applicable for year 2007-2008 Applicable for year 2008-2009
For Man
|
For Man
|
Taxable Income up to Rs.1, 10,000-: Nil
From 1,10,001 to 1,50,000-: 10%
From 1,50,001 to 2,50,000-: 20%
Above 2,50,001-: 30%
|
Taxable Income up to Rs.1, 50,000-: Nil
From 1,50,001 to 3,00,000-: 10%
From 3,00,001 to 5,00,000-: 20%
Above 5,00,001-: 30%
|
For Women
|
For Women
|
Taxable Income up to Rs.1, 45,000-: Nil
From 1,45,001 to 1,50,000-: 10%
From 1,50,001 to 2,50,000-: 20%
Above 2,50,001-: 30%
|
Taxable Income up to Rs.1,80,000-: Nil
From 1,80,001 to 3,00,000-: 10%
From 3,00,001 to 5,00,000-: 20%
Above 5,00,001-: 30%
|
For Senior Citizen
|
For Senior Citizen
|
Taxable Income up to Rs.1, 95,000-: Nil
From 1,95,001 to 2,50,001-: 20%
Above 2,50,001-: 30%
|
Taxable Income up to Rs.2, 25,000-: Nil
From 2,25,001 to 3,00,001-: 10%
From 3,00,001 to 5,00,000 : 20%
Above 5,00,001-: 30%
|
How to file Income Tax Return?
Why it is necessary to file the return?
A common view related to file the return is :- employer or
Bank has already deducted T.D.S.& we don’t have to pay any
Further income tax now so what is the necessity of filing the
Return ?but this is the not a correct view ; the person who
Satisfies the criteria given in the following table has to file
Voluntary return . and if return is not field till the end of
Assessment year then as per section 271(if)assessment officer
Can charge a penalty of Rs. 5000/-
Category of assesses
|
Criteria of filling voluntary return
|
Individual
H.U.F.
A.O.P.
Deemed person
|
If the Gross total income. Earned during any financial year, is
more than the basic exempted limit of income tax (Like for
FY 08-09 – for male: Rs. 1.50 Lac, for female 1.80 Lac & for
Sr. citizen 2.25 Lac), then Filing of return is compulsory for
that year
|
Company, Local Body, Partnership Firm
|
Filing return every year is compulsory without any income limit.
|
How to file the return?
(i) Assessee can file the return by himself or through tax consultant or by registered post in the prescribed format in the office of the concerned income tax officer along with proof of income and investment.
(ii) Salaried persons have many option of filing return
a. By way of new return form – ITR through Internet
b. By way of electronic media through banks under section 139(1B) through Internet
c. By filling form number 16AA at his own office through Suvidha Scheme.
Where to file the return?
As per Section 124, return can be filed in the office of Income Tax Officer under whose jurisdiction, either Assessee residence or Principal place of business/ Profession falls.
Income Exempt from Tax
Details of income exempt from tax (Tax free income) described in Section 10 of Income Tax Act. Out of which. Some important provisions are described in brief, as following:-
Sec. 10(1) Income from Agriculture is exempt. However, if the Net Agriculture
Income exceeds Rs.5000 it is taken into account for slab purpose.
Sec.10 (2a) Share of income of Hindu Undivided Family for the Member is exempt.
Sec.10 (2a) After assessment of tax of a partnership firm the income for its partners is exempt from tax.
Sec.10 (10d) Any sum received from Life Insurance Policy including Bonus is exempt.
Except the following:-
(!) Any sum received from key man Insurance Scheme and othinsurance Scheme elilgible for deduction for U/s 80DD/DDA.
(ii) Any sum received from Life Insurance Policy issued after whose Annual Premium is more than 20% of sum assured and if insured? Person is alive.
Sec.10 (15) Interest received from Post Office Saving Scheme &Govt. Relief Bond.
Sec.10 (16) Scholarship received to meet out the Expenditure of Education.
Sec.10 (20) Income of Local authority, i.e., Panchayat, Municipal etc. is exempt.
Sec. 10(25) Income of statutory provident fund or an approved Superannuation fund of
Gratuity fund.
Sec.10 (32) Income of Minor child up to Rs. 1,500 is Tax free; but if exceed will be added to Income of Parents.
nice
ReplyDelete