Income tax is a form of taxation imposed by the government on an individual's earnings.
It applies when a person's income exceeds a certain threshold determined by the government. The rate of income tax is established in the Union Budget at the beginning of each year.
Various sources of income can be subject to income tax, including profits from a business, salary, property sales, interest from savings, mutual funds, and professional income.
In India, the tax system comprises two main types of taxes: direct tax and indirect tax. Direct tax is levied directly on an individual's income, such as the tax deducted from their salary.
On the other hand, indirect tax is calculated and charged indirectly when purchasing goods or services. Many indirect taxes fall under the Goods and Service Tax (GST).
To maintain and track income tax records, individuals are required to electronically fill and submit their income tax return to the Income Tax department.
This process is known as Income Tax e-filing. The income tax return form varies based on the source and type of income, and it must be submitted annually within a specific deadline.
If an individual has paid an excess amount of tax during a particular year, they may be eligible for an income tax refund. This refund is issued when the tax paid exceeds the individual's actual tax liability.
If tax is not paid by the due date, a penalty under Section 234F will need to be paid along with interest under Section 234A.
What do a Financial Year (FY) and an Assessment Year (AY) entail?
What we mean by a financial year is a year that begins on the 1st of April and ends on the 31st of March of the following year.
The assessment year following FY 2022-23 will be from the 1st of April 2023 to the 31st of March 2024.
This period between the 1st of April 2023 and the 31st of March 2024 is called Assessment Year AY 2023-24. This means that currently, returns are being filed for FY 2022-23, during AY 2023-24
When Does Income Tax Return Filing Begin in 2023?
E-filing for Income Tax Return (ITR) for the Financial Year 2022-23 (Assessment Year 2023-24) is expected to begin soon, according to experts.
Tentatively, experts believe that ITR Filing will begin in the first week of June. Presently, the Income Tax Department has made offline filing of ITR possible for ITR-1, ITR-2, and ITR-4.
What are the documents required for filing ITR
Does ITR filing month sound dreadful to you?
Everyone starts calling their Chartered Accountants and relatives to take assistance in filling ITR.
But what’s the whole confusion about?
Requirement, requirement and requirement!
So here is the comprehensive checklist of all the documents/ requirements and information you need to take to file hassle-free ITR.
Basic Documents required for Filing ITR for all types of persons: -
1. PAN Card: It is an essential document. It is mandatory to have a PAN to file an ITR.
2. Aadhaar card: Under Section 139AA of the Income Tax Act, every Indian taxpayer must provide his/her Aadhar card details while filing ITR. It is mandatory to link your Aadhaar card with your PAN card for ITR filing.
3. Bank statements: Bank statements for the financial year for which you are filing the ITR should be available for the whole year and for all the banks. The bank statements should contain details of all the transactions made during the year.
4. Form 26AS: This is a statement that contains details of the tax deducted at source (TDS) on your income, advance tax paid, and self-assessment tax paid. This form will be downloaded from the Income Tax Department's website.
5. Challans: Challan of any advance tax or self-assessment tax(if paid during the year) since it would take approx. 3-4 days in updating the same in Form 26AS.
6. Details of all assets and liabilities as at year end, if taxable income exceeds Rs 50 Lakhs.
7. Form 15G/15H: If you are a senior citizen and your total income is below the taxable limit then you can submit Form 15G/15H to avoid TDS deduction on your income.
8. Any other relevant document depending on sources of income and deductions.
Documents required for Filing ITR on the basis of source of Income:
1. Income under head Salary / Pension:
→ Form 16: It is one of the most crucial income tax documents required by salaried individuals to file ITR. It is a TDS certificate issued by their employers to provide details on the TDS deducted on their salary. This form is issued by the employer to his employees and contains details of salary, allowances, and deductions.
→ Salary Slips: For salaried taxpayers, their latest salary slips form a part of the income tax documents.
→ Pension Statement / Passbook: In case the person is retired then pension statement is required for the financial year for which ITR is filing.
→ Rent receipts/ Rent Agreement: If you are claiming HRA (House Rent Allowance) deduction and the same is not intimated to the employer then you must have rent receipts/ rent agreement for the financial year.
2. Income under head House Property
The following documents are required to determine when rental income is earned by a taxpayer or there is a home loan-
→Co-ownership details in case of co-owned property
→Municipal Tax Receipts
→Form 16A if TDS is deducted on rental income
→Home loan repayment certificate/ Interest Certificate from the bank
→Pre-Construction Interest Details
3. Income under head Capital Gain
If you have earned capital gains from your mutual funds/equity investments or sale of the property, the proof of these gains is required-
→Purchase and Sale deed, stamp duty valuation in case of sale of house property, land, or building
→Statements from mutual fund or brokers involved.
→For shares & securities-Trading statement/ Stock Ledger/ Contact Notes
→Details of Improvement cost.
→Details of expenses incurred on the transfer of capital assets
→Proof of cost of the asset, cost of improvement and sales receipts in case of movable assets
→Details of investment made to claim exemptions
→Capital Gains Deposit Account details, if any
4. Income under head PGBP
→Balance Sheet and Profit & Loss Statement
→Bank Account Statement/ Passbook
→Supporting documents for expenses incurred
→GST returns, if registered
→Any other documents required to maintain the books of accounts of the business & profession.
5. Income under head Other Sources
→Total Interest income earned from savings
→Interest certificate from deposits/ Bonds/ NSC
→PPF Account Statement/ Passbook
→Dividend Warrants/ counterfoils
→Proof of details of receipt of any other incomes
→Rent Agreement of let out machinery, in case the renting is not the main business.
6. Documents required for Tax Saving investment-
→ELSS/ ULIP/ NSC investment details
→PPF account passbook/ statement
→Life/Medical Insurance Receipts
→Details of Tax Saving FD
→Details of National Pension Scheme investment
→Details of Senior Citizen Saving scheme investment
→Children Tuition Fees Paid Receipts
→Repayment Certificate for home loan/ education loan
→Certificate from specified medical authorities in case of disability
→Receipts/proof of any other tax saving investment/contributions
Documents Required for Foreign Income and Foreign Investments
→Details of foreign income and taxes deducted on the same
→Details of Assets held outside India, including the foreign bank accounts.
Income tax filing due dates for FY 2022-23 (AY 2023-24)
Category of Taxpayer
Due Date for Tax Filing- FY 2022-23
Individual / HUF/ AOP/ BOI
(books of accounts not required to be audited)
31st July 2023
Businesses (Requiring Audit)
31st October 2023
Businesses requiring transfer pricing reports
(in case of international/specified domestic transactions)
30th November 2023
31 December 2023
31 December 2023
Types of Income Tax Return (ITR) Forms
Understanding the right Income Tax Return (ITR) form and the accompanying forms is crucial for accurate and hassle-free tax filing.
Let's have a closer look at the various types of ITR forms and the forms you need to file:
ITR 1: Individuals residing in India with a total income of up to Rs 50 lakh are eligible to file ITR-1. This form is suitable for individuals earning income from jobs, houses, or other sources. Please note that NRIs cannot file ITR-1. Salaried taxpayers can use Form 16 for ITR filing.
ITR 2: Individuals and HUFs (Hindu Undivided Families) with income from sources other than their business or profession can file ITR-2. This form is applicable for individuals and NRIs who earn income from jobs, houses, capital gains, or other sources. Salaried individuals who have gains or losses from stock trading can also use ITR-2.
ITR 3: Individuals who need to disclose their income from business or profession should file ITR-3. Salaried individuals earning income from intraday stock trading or futures and options trading should also choose ITR-3. This form allows individuals to report income from jobs, real estate, capital gains, business or profession (including presumptive income), and other sources.
ITR 4: Individuals, HUFs, and partnership firms subject to the presumptive taxation system can file ITR-4. This form is used to report income from a business with a turnover of up to Rs 2 crore (section 44AD taxation) or income from a profession with a turnover of up to Rs 50 lakh (section 44ADA taxation). Freelancers working in notified professions can also file ITR-4.
ITR 5: LLPs (Limited Liability Partnerships), AOPs (Association of Persons), BOIs (Body of Individuals), and other alliance firms should file ITR-5. This form is suitable for reporting profits from businesses, professions, and other sources of income.
ITR 6: Businesses should use ITR-6 to report income from their industry or profession, along with any other forms of income.
ITR 7: ITR-7 is designed for businesses, partnerships, and trusts exempt from paying income tax.
To file your ITR correctly, you may require additional forms:
Form 16: Employers provide Form 16, a TDS certificate that outlines your gross pay, exemptions like HRA and LTA, net taxable income, tax-saving deductions, and salary TDS.
Form 26AS: Form 26AS contains details of tax deducted at source (TDS) on various incomes, including salaries, interest, and property sales. It also includes information about self-assessment tax, advance tax payments, and listed financial transactions.
Form 15G and Form 15H: Form 15G and Form 15H allow you to receive income without TDS deductions. Individuals under 60 years of age with gross taxable income below the basic exemption limit can file Form 15G, while senior citizens can file Form 15H if they have zero tax liability on their net income. These forms need to be submitted to the entity responsible for deducting your taxes.
What Happens if You Miss the Due Date for Filing Income Tax Returns
Here are some consequences and steps to follow in case you miss the due date for filing income tax returns.
- Interest: You may have to pay interest @ 1% per month on the unpaid tax amount according to Section 234A.
- Late Fee: You will face a penalty of Rs. 5000 as under Section 234F, which may be reduced to Rs. 1000 if your income is below Rs. 5 lakhs.
- Loss Adjustment: You may have incurred losses from mutual funds, stock markets, properties, or from your businesses alone which can be adjusted against next year’s income. Carrying your losses forward lowers your tax liability greatly. However, remember that you are only permitted to adjust your losses if you declare them in your ITR and file them before the deadline with the income tax department.
- Belated or Late Returns: In most cases of missing the deadline for filing ITR, you can file it after the due date by the belated return due date. Though, you will have to pay the late fee, interest and will not be able to carry forward losses. The due date for filing belated returns for the current financial year is in the assessment year, 31st of December 2023.
Due Dates to Note for Advance Tax Instalments for Financial Year 2023-24
There are many parts to the process of filing income tax. These phases, such as filing income tax returns or paying advance tax on time, need to be followed according to their specific due dates.
The following table captures the due date for payment of advance tax.
Nature of Tax Compliance
Portion of Tax to be Paid
15th of June, 2023
15% of tax liability
15th of September, 2023
45% of tax liability
15th of December, 2023
75% of tax liability
15th of March, 2024
100% of tax liability
31st of March, 2024
100% of tax liability
Who are liable to file Income Tax Return?
1. Every assessee other than company, partnership firm or LLP whose total income exceeds the specified limit prescribed in Income Tax Act must file an income tax return. In case of Company, partnership or LLP, they have to file an Income tax return irrespective of their income or loss.
2. A person whose source of income is from property under religious trusts or charitable trusts or the income is generated from voluntary contribution is also liable to file ITR if income exceeds the prescribed limit.
3. A person has to file an income tax return even if his source of income is from a bond, fixed deposits, or property.
4. Every Indian citizen who has an asset, financial interest in foreign or has signing authority in a foreign account is liable to file an income tax return. For ease of doing, they can choose online income tax return filing.
5. Filing an income tax return is very important for VISA sanctioning, and it also helps to take a loan. So, a person who requires these must file an income tax return.
Why You Should Consult an Expert for Income Tax E-filing
Filing an income tax return is a very important process, and the income tax return is a vital document, so any fault in this process can lead to several other problems and can even attract a penalty.
The faults can occur in the process of choosing the correct income tax return form; you can miss the reporting source of income.
Putting incorrect personal information and wrong information regarding deductions to be claimed can harm the ITR process.
All of this can lead to paying excess tax or incorrect tax information. To minimize your income tax and ITR errors, it is best to consult an expert and do proper e-filing income tax.