7 Common Myths about Income Tax Return Filing you should know
We sometimes grow conceptions on basis of rumours. It is also in the case of filing ITR return. There are a variety of misconceptions regarding tax filing in India. You must be aware of them. Most importantly, you have to know the true story instead of the myths, lest you may not repent in case of tax filing. Hence, I am going to state here the actual facts over the 7 common myths about income tax return filing.1. I have a PAN so I must submit my income tax return
Filing of the income tax return must require a valid PAN. But, only possessing a PAN (Permanent Account Number) does not mean to file IT return is mandatory.
As per IT ACT 1961 every citizen of India whose annual gross income is more than the basic exemption limit (presently Rs.250000 for individual below 60 years) must process his or her tax return. But, individual having an annual income less than Rs. 250000 do not need to file ITR.
2. No need to file IT return if income is not taxable
It is mandatory to file a return if gross annual income is more than rupees 250000. Gross income is the total income from salary/ wages/ pension, from savings, from house property etc. before any deductions.Even in case of nil income or income having zero tax liability, you can also file your return. Because ITR filing even with zero tax has many benefits too.If my tax liability is Nil I should not file a return
Though your tax liability may become nil after the deductions for your savings and other expenses, filing an income tax return is mandatory in the following cases:
If your gross income before any deductions is more than the basic exemption limit.
If you have any claim of refund for deduction of TDS from your savings.
You need a return acknowledgement if you intend to apply for a visa or loan.
My income is below rupees 250000, I cannot file ITR
Any Indian citizen can file his/ her Income Tax Return irrespective of income group. But, it is not mandatory to file IT return unless your gross annual income is higher than Rs. 250000.
Though in many cases, you need to file a return even your Gross Income is below basic exemption level. A few of them are as follows:
1) To claim a refund.
2) Intend to have an income proof certificate
3) To furnish return acknowledgement to the bank for processing your loan.
I have already paid my income tax so I have nothing to do with the tax return.
Paying Income Tax as per your income level is not enough. Rather, after the end of the financial year, you have to file your ITR showing all your income savings deductions and liability of tax that you have paid so that Income Tax Department may scrutiny and assess your return. You should not skip this process else you will be penalized from the IT department as per their existing rules.
Income from fixed deposit interest can only be shown in a return after the maturity of the same.
Most of the bank credit interest on fixed deposit quarterly basis. Hence, it is wise to show annual accrued interest on your fixed deposit in your tax return. Otherwise, on the date of maturity interests will be clubbed and may increase your tax liability to the next higher bracket.
Filing of income tax return online is a very complex time-consuming thing and needs to hire a professional to do the job.
It is also one of wrong conceptions to think that ITR filing online is very much complex subject with numerous calculations. On the contrary, it is easier and more convenient to file your return online than to do it manually.Most of the cases you need simply to enter your data in an online form and let the system do all the calculation. You just check and verify the same. In this era of internet, the tedious job of ITR filing can easily be done even from a hand holding smartphone.
RELATED TOPICS: Online income tax return filing- a complete guide
Conclusion:
Hope this piece of writing "7 common myths about income tax return filing" may guide you at the time of filing your return. Hence, if you think that the article is realy helpful one then do not hesitate to share it with others. Thanks for reading.
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