Income Tax Returns, Types & Filing of e-return - Assessment Procedure, Income Tax Laws | Income Tax Laws - B Com PDF Download

An Income Tax (IT) Return is the tax form or forms used to file income tax with the Income Tax Department. The tax return is usually in a predefined worksheet format where the income figures used to calculate the tax liability are written into the documents themselves.

The law states that tax returns must be filed every year for an individual or business that received income during the year, whether through regular income (wages), dividends, interest, capital gains or other sources.

Tax returns, regardless of whether it relates to an individual or a business, must be filed by a specific date.

If the return shows excess tax has been paid during a given year, the assesse is eligible for a ‘tax refund’, subject to the department’s interpretations and calculations.

Due date for filing returns

Due dates of filing income tax return for FY 2017–18(AY 2018–19) are as under :

1. 31 August 2018 for Individuals not requiring audit under any law.
2. 30 September 2018 for Companies or a working partner of a firm or Individuals requiring audit under any law.
3. 30 November 2018 for any person (corporate/non-corporate) who is required to furnish a report in Form No. 3CEB u/s 92E.

The tax department recently has extended the last date to file ITR (Income tax return).

The due date for filing ITR for financial year 2017–2018 or assessment year 2018–2019 has been extended to 31 August from 31 July

Note – From F.Y 17–18 , Late fee u/s 234F shall be levied if return is filed after the due date by any assessee.

Penalty on late filing of ITR (effective from 1st April 2018)

As per the new law from this year, Individuals will have to pay late fee after last date to file income tax return

1. Rs 5000 if tax is filed after due date of 31 July but on before 31 December of that assessment year (in this case 31 December 2018)
2. Rs 10,000 if tax is filed after 31 December but on or before 31 March of the relevant assessment year (in this case from 1 January to 31 March 2019)

But, there is relief to small taxpayer, IT Department has stated if your total income does not exceeds 500,000 , then maximum penalty of Rs 1000 will be levied on delay of ITR filing.

Types of Returns

Before discussing the types of Income Tax Return filing, Let’s first understand that what is ITR. The Income Tax Return is a statement of the incomes of an individual from different sources and the tax that is to be paid on that income. It also acts as a proof of the tax that is being paid by the Assessee. ITR has to be filed every year in the form which is applicable to the assessee. There are 7 types of ITR forms -

• ITR-1
• ITR-2
• ITR-3
• ITR-4
• ITR-4S

The following income tax return forms are only applicable to companies and firms:

• ITR-5
• ITR-6
• ITR-7

ITR-1

This income tax return form is also called a Sahaj form. The ITR-1 form is to be filed solely by an individual taxpayer. Any other assessee liable to pay tax will not be eligible to avail of this form for the purpose of filing their returns. This form is applicable for the following:

• Individuals who earn income through salary or through means such as pension
• Individuals who earn income from a single housing property
• Individuals who have no income from any other business or who have no income from the sale of any assets ie: capital gains
• Individuals who do not own any assets or property in countries other than India
• Individuals who do not earn income from any country outside India
• Individuals whose income from agriculture is below Rs 5,000
• Individuals who earn income from various investments or sources such as Fixed Deposits, Investments, Shares etc
• Individuals who have not earned income from any windfall such as lotteries or horse racing
• Individuals who wish to club the income of their spouse or underage child with their own income, so long as the income to be clubbed is in accordance with the criteria mentioned above

ITR 2

The ITR-2 Form is generally used by individuals who have accrued income through the sale of assets or property as well as individuals who earn income from countries outside India. Individuals or Hindu Undivided Families (HUF) can avail of this form to file their returns. This form is applicable for the following:

• Individuals who earn income through salary or through means such as pension
• Individuals who earn income through the sale of assets or property in India i.e: capital gains
• Individuals who earn income from more than one housing property
• Individuals who do not earn income from any business venture
• Individuals who own assets in countries outside of India
• Individuals who earn income from countries outside of India
• Individuals whose income from agriculture is above Rs 5,000
• Individuals who earned income from any windfall such as lotteries or horse racing

ITR 3

The ITR-3 Form is to be used by a taxpayer who is either an individual or a Hindu Undivided Family (HUF) who solely operate as a partner in a firm but who do not conduct any business under the firm or who do not earn any income from the business conducted by the firm. This form can be filed by those taxpayers whose taxable income earned from business is only in the form of the following received as a partner:

• Salary
• Commission
• Bonus
• Interest
• Remuneration

ITR 4

The ITR-4 form is to be used by those individuals who conduct a business or who earn income through a profession. This form is applicable to any type of business, undertaking or profession, with no limit on the income earned. Along with the income earned from business, taxpayers can also club any income they receive from windfalls, speculation, salaries, lotteries, housing properties etc with their business income. Any individual ranging from shopkeepers, doctors, designers, agents, retailers, contractors etc is eligible to file their income tax returns using this form

ITR-4S

The ITR-4S form is also known as the Sugam form and can be used by any individual or Hindu Undivided Family (HUF) for filing their tax returns. This form is applicable for the following:

• Individuals who earn income from any business
• Individuals who earn income from a single housing property
• Individuals who do not earn income through the sale of assets or property in India ie: capital gains
• Individuals whose income from agriculture is below Rs 5,000
• Individuals who do not own any assets or property in countries other than India
• Individuals who do not earn income from any country outside India

This income tax return form is used in special circumstances and applies to businesses where any income earned is based on a presumptive method of calculation.

ITR 5 :

The ITR-5 form is to be used by only by the following entities for filing income tax returns:

• Firms
• Limited Liability Partnerships (LLPs)
• Body of Individuals (BOIs)
• Association of Persons (AOPs)
• Co-operative Societies
• Artificial Judicial Persons
• Local Authorities

ITR 6

The ITR-6 form is to be used only by companies except those companies or organisations that claim tax exemption as per Section 11. Those organisations that claim tax exemptions as per Section 11 are organisations wherein the income received is accumulated from the property used for the purpose of religion or charity. This particular income tax return form can only be filed online.

ITR 7

The ITR-7 income tax form is to be filed by individuals or companies that are required to submit their returns under the following sections:

• Section 139(4A) - Under this section, returns can be filed by those individuals who receive income from any property that is held for the purpose of charity or religion in the form of a trust or legal obligation
• Section 139(4B) - Under this section, returns are to be filed by political parties provided their total income earned is above the non-taxable limit
• Section 139(4C) - Under this section, returns are to filed by the following entities:
• Any institution or association mentioned under Section 10(23A)
• Any association involved with scientific research
• Any institution mentioned in Section 10(23B)
• Any news agency
• Any fund, medical institution or educational institution
• Section 139(4D) - Under this section, returns are to be filed by entities such as colleges, universities or any other such institution wherein income returns or loss are not required to be provided in accordance with other provisions outlined in this section

Section 139 of Income Tax Act 

However, As per Section 139 of the Income Tax Act, the different types of Income Tax Return Filing are:

1.Normal Return u/s 139(1)

2.Belated Return u/s 139(4)

3.Revised Return u/s 139(5)

4.Loss Return u/s 139(3)

5.Defective Return u/s 139(9)

Normal Return

Normal return is the return which is filed by a person who is required to file the return as per the criteria. Income Tax Return Filing in the case of normal return has to be done by the following persons :

• Any person whose total income exceeds the threshold limit which is Rs.2,50,000 in the FY 2018-2019 for normal assesses and this limit is Rs 3,00,000 for assesses who are more than 60 years old but less than 80 years old and Rs 5,00,000 for super senior citizens (assesses who are more than 80 years old).

• Company or a Firm.

• A person who is carrying forward any loss under a head of income.

•  If a person is not required to file a return but is having any assets located outside.

• A person who is having a signing authority in any account located outside India.

• A person who is income which is derived from property held under a trust for charitable or religious purposes or a political party or a research association, trade union, a not for profit university or educational institution, a hospital, infrastructure debt fund, news agency, educational or medical institution or any other specified authority, body or trust.

• A person who is having long-term capital gains from the sale of equity shares or business trust in a company or sale of a unit of equity oriented mutual funds of more than Rs 2,50,000 in a financial year. These are exempted under Income Tax but an income tax return has to be filed.

Belated Return

If the assessee fails to furnish the return of income within the due date under Section 139(1) or within the time which is allowed to him through the notice under Section 142(1), then he can file a Belated Return.

Due date for filing Belated Return

The belated return shall be filed on or before 31st March of the relevant Assessment Year. It may be noted that the date of filing a belated return has been changed from F.Y. 2016-17. Earlier, the belated return was allowed to be filed before the end of F.Y. after the relevant A.Y.

Revised return of Belated Return

From F.Y. 2017-18, the Belated income tax return filing under section 139(4) which has been done by the assessee for any year can be revised as per section 139(5) for if he discovers any omission or any wrong statement therein. The revised return for belated return can be filed at any time before the expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.

Revised Return

Revised return is a return which is filed u/s 139(5) as revision for the original return. It is a revision for any omission or mistake made in the filing of that original return. In order to meet the deadline, a person may forget to disclose some income or may make any other mistake like a mistake in claiming any deduction.

Returns eligible for revision:

• An original return filed u/s 139(1).

• The belated return filed u/s 139(4) can also be revised now.

Time Limit of Revised Income Tax Return filing

Revised Return of Income Tax can be filed by an assessee any time

• before the end of the relevant assessment year; or

• before completion of the assessment

whichever is earlier.

For example: If an assessee files the return for F.Y. 2016-17 (A.Y. 2017-18) on 8th July 2017. And later on, if he discovers some mistake, then he can file a revised return of Income Tax anytime up to 31 March 2018 or before the completion of Assessment, whichever is earlier.

Loss return

The Income tax return filed with the details of losses is the Loss Return. You may have to file an income tax return with details of the loss, depending upon the type of loss. Filing a return for your losses helps to carry them forward to future years, in which these can be set off against future gains when they arise.

If you have a loss from business or profession or loss under the head capital gains, you must file an income tax return as:

• If you have any income in that year, your losses will be set off with the income you have earned and you have to pay tax on the income after deducting losses from it.

• If you don’t have any income in that year, then in such a case you will be allowed to carry forward losses and adjust them against future income in your returns for coming years. Losses from house property, capital loss, and business loss are allowed to be carried forward for 8 years.

Defective Return

Defective Return u/s 139(9) is the type of return for which a person receives a notice because the IT Department has found any discrepancies or mistakes or any missing information in ITR.Once you file your income tax return, the details provided by you in the ITR is cross-verified and processed by the IT dept. The dept compares the details provided by you with the information that is available to them.

Time limit

A person who has received notice under section 139(9) about the defective return can rectify the return within a period of 15 days from the date of such intimation under section 139(9).