Important Keyword: Income Heads, IT Notice, Section 143(1).
Table of Contents
Section 143(1): Letter of Intimation
Once the taxpayer files their return, the income tax department performs an initial check. This process involves verifying any arithmetic mistakes, incorrect claims in the return, differences in tax calculations, and confirming if tax payments are accurate. If the department finds any issues, they send the taxpayer an intimation letter under section 143(1). This letter shows a comparison between the figures provided in the filed Income Tax Return and those calculated by the income tax department.
Intimation under section 143(1)
When a taxpayer submits their return, it undergoes an initial assessment by the Central Processing Centre (CPC). The CPC, established by the Central Board of Direct Taxes (CBDT), centralizes the processing of returns to quickly determine tax liabilities or refunds.
Purpose and Benefits of the CPC
The CPC automates the initial processing of tax returns, providing several benefits:
For Taxpayers: Faster and smoother processing of returns.
For the Tax Department: Reduced workload, allowing focus on more complex tasks.
Process of Preliminary Assessment
The assessment involves a computer-driven system that checks the return for accuracy. Here’s the step-by-step flow:
Recalculation of Income: The system recalculates the total income or loss based on the available information.
Verification: Major categories are verified, including:
Incomes under various heads
Gross total income
Deductions under Chapter VIA
TDS and taxes paid (Self Assessment tax and Advance Tax)
Adjustments and Intimation:
After verification, adjustments are made as per section 143(1).
An intimation letter is sent to the taxpayer detailing the proposed adjustments.
The taxpayer must respond within a prescribed time limit.
If a response is received, final adjustments are made accordingly. If not, the proposed adjustments are considered final.
Final Tax Liability: Adjustments are made against TDS and other relief claims under sections 90/91 if applicable, followed by the issuance of the final intimation to the taxpayer.
Types of Intimations
No Demand or No Refund: No adjustments made, and the filed return is accepted as is.
Demand Intimation: Adjustments result in additional tax liabilities.
Refund Intimation: If the tax liability is lower than the taxes paid, the excess amount is refunded.
Types of Adjustments under Section 143(1)
The CPC may issue an intimation letter for the following adjustments:
Arithmetic Errors: Corrections of calculation mistakes.
Incorrect Claims: Disallowance of claims that are evidently incorrect based on the return’s information.
Disallowed Expenses: Expenses reported in the audit report but not in the return.
Set-Off of Losses: Disallowance of loss set-offs if the previous year’s return was filed late.
Unreported Income: Income shown in Form 26AS/16A/16 but not reported in the return.
Inconsistencies: Contradictions within the return or with other sections.
Sample Intimation letter u/s 143(1)
Communication of Intimation under section 143(1)
Taxpayers can receive the intimation letter under section 143(1) through their registered email or mobile number on the income tax portal. The Central Processing Centre (CPC) is the sender of these intimations.
Time Limit for Issuance
The income tax department must issue the intimation under section 143(1) within nine months from the end of the financial year in which the return was filed.
Example
If Jay filed his income tax return on July 20, 2023, for the financial year 2022-23, the income tax department can send the intimation under section 143(1) up to December 31, 2024. This is because it is nine months from the end of the financial year 2022-23, in which the return was filed.
No Communication within Timeframe
If a taxpayer does not receive any intimation within this nine-month period, it implies that there have been no changes or corrections made to the initially filed return. Consequently, there are no modifications in the tax liability or refund due. In such cases, the filed return is considered to have been accepted as filed, effectively serving as an intimation under Section 143(1).
Steps to download Intimation under Section 143(1)
Login to the e-filing portal Login to the income tax website using valid credentials.
Navigate to View Filed Returns Go to e-file > Income Tax Returns > View Filed Returns
Click on View Details For the relevant Assessment Year, click on View Details
Download Intimation Order under Section 143(1) In the next step, taxpayers can see the status of each filing stage. If it shows ‘Processed’, they can download the intimation by clicking on ‘Download Intimation Order’.
Open Intimation Order under Section 143(1) The intimation order is password-protected. The password to open the intimation letter is PAN in lowercase and the date of birth (DDMMYYYY) is without any space. Eg: PAN is AAAPA1234A and the date of birth is 01/01/2000. The password would be aaapa1234a01012000.
Response to Intimation under section 143(1)
Upon receiving the intimation, the taxpayer should initially verify the correctness of the information provided. This includes confirming details such as the Name, PAN, Assessment year, etc.
Case scenario
Action
The taxpayer’s filed return matches the department’s calculations, resulting in no additional tax demand or refunds.
In such cases, no actions are required from the taxpayer. And in cases where excess tax are paid the refund amount will be credited to their pre-validated bank account.
As per the calculations of the department, the tax liability is lower however while filing the return taxpayer has paid excess taxes.
In this case, no actions are required by the taxpayer and the refund will be credited to their pre-validated bank account.
There are a few errors in the return filed by the taxpayer.
The taxpayer needs to file a revised return u/s 139(5).
The tax liability as per the calculations of the department is higher than the tax paid by the taxpayer while filing a return.
If the taxpayer Agrees: They need to pay the outstanding demand and file a response.
If the taxpayer Disagrees: They need to file aRectification request u/s 154.
Consequences of Non-response
Upon receiving an intimation letter under section 143(1), the taxpayer must respond within the specified time limit.
Consequences of Non-Response
If the taxpayer fails to respond within the given timeframe, the income tax department will treat the proposed adjustments as final. The department will then proceed to calculate the final tax liability or refund based on these adjustments.
Final Intimation
After these calculations, the taxpayer will receive a final intimation letter detailing the ultimate tax liability or refund. This final letter concludes the assessment process under section 143(1).
Important Keyword: Capital Gains, HUF, Income Heads, ITR Form, ITR-2.
Table of Contents
What is ITR-2 Form?
ITR-2 Form serves as the Income Tax Return form for individuals and HUFs who lack any business or professional income. This means individuals with salary, house property, capital gains, and other sources of income can file ITR-2.
Important Income Tax Documents:
Form 16: For salary income
Form 26AS: Tax Credit Statement
Form 12BB: Statement showing particulars of perquisites, other fringe benefits or amenities, and profits in lieu of salary with value thereof
Form 10BA: Declaration to claim deduction under section 80GG
Form 15G/15H: Declaration to avoid tax deduction at source on interest income
Mandatory ITR Filing:
Until FY 2018-19 (AY 2019-20), filing Income Tax Return wasn’t compulsory if the total income was below the basic exemption limit. However, Budget 2019 introduced a new provision under Section 139(1), mandating ITR filing if a taxpayer engages in high-value transactions. These transactions include:
The ITR-2 Form comprises 25 sections, including Part A General, Schedule Salary, Schedule House Property, Schedule Capital Gains, and others. These sections must be filled before reviewing, paying tax, and submitting the return.
Who Can File ITR-2?
ITR-2 can be filed by individuals or HUFs whose total income includes:
Salary/pension income
Income from multiple house properties
Capital gains income
Income from other sources (including lottery winnings and income from racehorses)
Agriculture income exceeding INR 5,000
Foreign assets/foreign income
Additionally, it can be used when another person’s income is clubbed with the taxpayer’s income falling under any of the above categories.
Who Cannot File ITR-2?
Individuals with total income including business or professional income cannot file ITR-2. Likewise, taxpayers earning income from a partnership firm must file ITR-3 or ITR-4 to declare such income.
File ITR-2 Online using Income Tax Website
General Information Fill in the general information which consists of your contact, personal information, filing status & bank details.
Schedule Salary, House Property & Other Sources In Schedule Salary, you need to review, enter, edit details of your income from salary or pension, exempt allowances and deductions u/s 16. Under schedule house property, you need to review, enter & edit details relating to house property (self-occupied, let out, or deemed let out). The details include co-owner details, tenant details, rent, interest, pass through income etc. and, under schedule other sources, you need to review, enter and edit details of all your income from other sources, including (but not limited to) income charged at special rates, deductions u/s 57 and income involving race horses.
Schedule Capital Gains Capital Gains arising from sale or transfer of different types of capital assets have been segregated. In a case where capital gains arises from sale or transfer of more than one capital asset, which are of same type, please make a consolidated computation of capital gains in respect of all such capital assets of same type. But in case of transfer of land / building, it is mandatory to enter the computation towards each land / building. In Schedule Capital Gains, you need to enter details of your short term and long term capital gains or Losses for all types of capital assets owned.
Schedule 112A & Schedule 115AD(i)(iii) Proviso Under Schedule 112A, you need to review, enter and edit details about sale of equity shares of a company, an equity-oriented fund, or a unit of a business trust on which STT is paid. Schedule 115AD (1)(iii) proviso involves entering the same details as for Schedule 112A but is applicable to non-residents
Schedule Current Year’s Loss Adjustment (CYLA) In Schedule Current Year’s Loss Adjustment (CYLA), you will be able to view details of income after set-off of current year losses. The unabsorbed losses allowed to be carried forward out of this are taken to Schedule CFL for carry forward to future years.
Schedule Brought Forward Loss Adjustment (BFLA) You can view the details of income after set-off of brought forward losses of earlier years.
Schedule Carry Forward Loss You can view the details of losses to be carried forward to future years.
Schedule VI-A you need to add and verify any deductions you need to claim under Section 80 – Parts B, C, CA, and D of the Income Tax Act
Schedule AMT You need to confirm the computation of Alternate Minimum Tax payable u/s 115JC.
Schedule AMTC You need to add details of tax credits u/s 115JD.
Schedule SPI You need to add the income of specified persons (e.g. spouse, minor child) that is includable or required to be clubbed with your income as per Section 64.
Schedule EI You need to provide your details of exempt income i.e., income not to be included in total income or not chargeable to tax. The income types included in this schedule include interest, dividend, agricultural income, any other exempt income, income not chargeable to tax through DTAA and pass through income which is not chargeable to tax.
Schedule SI You will be able to view the income that is chargeable to tax at special rates. The amount under various income types are taken from the amounts provided in the relevant Schedules i.e., Schedule OS, Schedule BFLA.
Schedule PTI You need to provide details of pass through income received from business trust or investment fund as referred to in section 115UA or 115UB.
Schedule Foreign Source Income (FSI) You need to report the details of income, which is accruing or arising from any source outside India. This schedule is available for residents only.
Schedule TR You need to provide a summary of tax relief which is being claimed in India for taxes paid outside India in respect of each country. This schedule captures a summary of detailed information furnished in Schedule FSI.
Schedule FA You need to provide details of foreign asset or income from any source outside India. This schedule need not be filled up if you are Not Ordinarily Resident or a Non-Resident.
Schedule 5A & Schedule AL In Schedule 5A, you need to provide the information necessary for apportionment of income between husband and wife if you are governed by the system of community of property under the Portuguese Civil Code 1860. If your total income exceeds ₹50 lakh, it is mandatory to disclose the details of movable and immovable assets in Schedule AL along with liabilities incurred in relation to such assets. If you are a non-resident or resident but not ordinarily resident, only the details of assets located in India are to be mentioned.
Tax Paid Under Part B, verify all the auto populated rows from the details that you had entered in the schedules. Verify the tax paid details from the previous financial year.
File Income Tax Return Click on eFile > Income Tax Returns > File Income Tax Return
Assessment Year and Mode Select the appropriate assessment year and select the online mode and click on proceed.
ITR Form Select the appropriate ITR Form, in this case, ITR 2.
Select the checkboxes Next, select the checkboxes applicable to your situation.
Review and File ITR Finally, review all the details that you had entered previously and pay the tax dues (if any) and submit the return. Once you submit the return, proceed to everify it to complete the process.
Structure of ITR-2
Part/ Schedule
Heading
Fields
PART A- GENERAL
Personal Information
Name, Address, Date of Birth, PAN, contact details.
Filing Status
Employer Category, Tax status, Residential status, Return filed under the section.
PART B-TI
Computation of total income
Total Income from all income sources, Losses of the current year set off, Gross Total Income, Deductions under Chapter VI-A.
PART B-TTI
Computation of tax liability on total income
The Bank Account details, Verification, and TRP details (if any) are to be provided.
Schedule IT
Details of Advance Tax and Self Assessment Tax Payments
BSR code, Date of Deposit, Chalan number, Tax Paid
Schedule TDS
TDS1: Details of Tax Deducted at Source from SALARY
TAN of Employer, Employer Name, Tax Deducted, etc.
Schedule TDS
TDS2: Details of Tax Deducted at sources from Income other than Salary (As per FORM 16A) & Details of tax deducted at source on sale of immovable property u/s 194IA (Form 26QB)
TAN, Name of Deductor, Year of Deduction, Tax deducted, etc.
Schedule TCS
Details of tax collected at source
TAN of the collector, Name of Collector, Tax Collected, etc.
Schedule S
Details of Income from Salary
Name and PAN of the Employer, Address of the Employer, Salary, Perquisites, Allowance, etc.
Schedule HP
Details of Income from House Property
Details of House Property, Name and PAN of the Co-owners and Tenants, Details of Rent Income, Interest payable on Borrowed Capital, etc.
Schedule CG
Capital Gains
Details about the Short term and Long term Capital gains, Sales consideration, Cost of Acquisition, Deductions under Section 54,54B,54EC,54F,54GB.
Schedule OS
Income from Other Sources
A dividend, Interest, Rental income from machinery, Winnings from lotteries, Crossword puzzles, Races, Games.
Schedule CYLA
Details of income after setoff of current year losses
Details of current year losses and its Inter Headset off
Schedule BFLA
Details of income after Set off of Brought Forward Losses of earlier years
Details of brought forward losses set off against current year’s income, total brought forward losses set off.
Schedule CFL
Details of Losses to be carried forward to the future years
Total of earlier year losses, current year losses, Total of carried forward to future years.
Name of Donee, Address, City or District, State Code, PAN of Donee, Amount.
Schedule SPI
The income of specified persons (spouse, minor child, etc.) included in the income of the assessee (income of the minor child, in excess of Rs. 1500 per child, to be included)
Name and PAN of Person, Relationship, Nature of Income, Amount.
Schedule SI
Income chargeable to income tax at special rates
Description of Special Rate Income, Special Rate, Income, Taxable Income after adjusting min. chargeable to tax, Tax thereon.
Schedule EI
Details of Exempt Income (Income not to be included in Total Income)
Interest income, Dividend, Agricultural Income.
Schedule PTI
Details of Income from Business Trust or Investment Fund
Details of Income earned from Business Trust or Investment Fund as per section 115UA, 115UB.
Schedule FSI
Details of Income from outside India and tax relief
A country, Head of income, Income from outside India, Tax paid outside India, Tax payable in India, Relevant article of DTAA if relief is claimed u/s 90 or 90A
Schedule TR
Summary of tax relief claimed for taxes paid outside India
Details of tax relief claimed
Schedule 5A
Information regarding the appointment of income between spouses governed by Portuguese Civil Code
Name and PAN of a spouse, Income received under different heads, Amount appointed in the hands of the spouse, TDS details.
Schedule FA
Details of Foreign Assets and Income from any source outside India
Details of foreign bank accounts, financial interest in any entities, Immovable Properties, Other Capital Assets.
Schedule AL
Details of Assets and Liabilities
Details of an immovable asset, Details of a movable asset, Interest held in the asset of a firm or AOP.
Here’s a detailed checklist of documents you’ll need for a smooth income tax filing process:
Essential Documents:
PAN (Permanent Account Number)
Aadhaar Card
Bank Account Details
TDS Certificates
Challan of Taxes Paid
Details of Original Return (if filing a revised return)
Details of Notice (if filing in response to a notice)
Documents Based on Type of Income:
For Salary Income:
Form 16/Salary Slips received from your employer
Pension Statement/Passbook
For House/Property Income:
Co-owner details (if applicable)
Address of the property
Interest certificates/Repayment certificate from a bank (for property loan)
Here are the major changes in ITR 2 for Assessment Years 2021-22 and 2020-21:
For AY 2021-22:
Option to Choose Tax Regime: Taxpayers can opt between the old and new tax regimes based on their preference.
Quarterly Breakdown for Dividend Income: Dividend income must be reported with quarterly breakdowns for accurate calculation of interest under Section 234C.
For AY 2020-21:
Mandatory Filing for RNORs and Non-Resident Individuals: RNORs and non-resident individuals must file ITR 2 even if their income is below INR 50 lakh.
Disclosure of High-Value Transactions: Taxpayers must disclose cash deposits exceeding INR 1 crore in current accounts, expenditure above INR 2 lakh on foreign travel, or expenditure above INR 1 lakh on electricity.
Resident Individuals Owning Multiple Properties: Residents with more than one house property must file ITR 2.
Ineligibility for Business and Profession Income: Taxpayers earning income from business and profession cannot file ITR 2.
Disclosure of Company Details: Directors in a company or those holding unlisted equity investments must disclose the type of company.
Separate Section for LTCG Calculation: A dedicated section, Section 112A, is introduced for calculating long-term capital gains on the sale of equity shares or units of a business trust liable to STT.
Important Keyword: HUF, Income Heads, ITR Form, ITR-2A.
Table of Contents
ITR-2A form for Multiple House Property Income [Discontinued]
ITR-2A made its debut in the fiscal year 2014-15 (Assessment Year 2015-16), tailored specifically for individuals and Hindu Undivided Families (HUFs) with salary income and ownership of more than one house property. However, those with capital gains were ineligible to utilize this form. Regrettably, this form bid adieu starting from the fiscal year 2016-17 (Assessment Year 2017-18). Henceforth, taxpayers can file ITR-2 instead of ITR-2A.
Who Can File ITR-2A?
Individuals and HUFs with the following income sources are eligible:
Salary Income
Income from House Property (Single or multiple house properties)
Income from Other Sources
Agricultural/Exempt Income (without any limits)
Who Cannot File ITR-2A?
However, ITR-2A is not suitable for individuals or HUFs with the following income types:
Income from Capital Gains
Business or Profession Income
Income from Foreign Sources and/or possessing any foreign assets
Structure of ITR-2A
Part/ Schedule
Heading
Fields
PART A- GENERAL
Personal Information
Name, Address, Date of Birth, PAN, contact details.
Filing Status
Employer Category, Tax status, Residential status, Return filed under the section.
PART B-TI
Computation of total income
Total of all the incomes.
PART B-TTI
Computation of tax liability on total income
The Bank Account details, Verification details.
Schedule IT
Details of Advance Tax and Self Assessment Tax Payments
BSR code, Date of Deposit, Chalan number, Tax Paid.
Schedule TDS
TDS1: Details of Tax Deducted at Source from SALARY
TAN of Employer, Employer Name, Tax Deducted, etc.
Schedule TDS
TDS2: Details of Tax Deducted at sources from Income other than Salary (As per FORM 16A)
TAN, Name of Deductor, Year of Deduction, Tax deducted, etc.
Schedule S
Details of Income from Salary
Employer Details, Salary, Perquisites, Allowance, etc.
Schedule HP
Details of Income from House Property
Details of House Property, Name and PAN of the Co-owners and Tenants, Details of Rent Income, Interest payable on Borrowed Capital, etc.
Schedule OS
Income from Other Sources
A dividend, Interest, Rental income from machinery, Winnings from lotteries, Crossword puzzles, Races, Games, etc.
Schedule CYLA
Details of income after setoff of current year losses
Schedule BFLA
Details of income after Set off of Brought Forward Losses of earlier years
Schedule CFL
Details of Losses to be carried forward to the future years
Schedule VI-A
Deductions under Chapter VI-A
Deductions under section 80C, 80CCC, 80CCG, 80D, 80DDB, 80E, 80G, 80TTA etc.
80G
Details of donations
Name of Donee, Address, City or District, State Code, PAN of Donee, Amount, etc.
Schedule SPI
Income of specified persons (spouse, minor child etc.) included in the income of the assessee (income of the minor child, in excess of Rs. 1500 per child, to be included)
Name and PAN of Person, Relationship, Nature of Income, Amount.
Schedule SI
Income chargeable to income tax at special rates
Description of Special Rate Income, Special Rate, Income, Taxable Income after adjusting min. chargeable to tax, Tax thereon.
Schedule EI
Details of Exempt Income (Income not to be included in Total Income)
Interest income, Dividend, Agricultural Income, etc.
Schedule 5A
Information regarding the appointment of income between spouses governed by Portuguese Civil Code
Name and PAN of spouse, income received under different heads, amount appointed in the hands of the spouse, TDS details, etc.
Here’s a comprehensive guide on the documents required and the filing process for ITR 2A:
Essential Documents:
PAN (Permanent Account Number)
Bank Account Details
TDS Certificates
Counterfoils of Taxes Paid
Details of Original Return if Filing Revised Return
Details of Notice if Filing in Response to Notice
Documents Based on Income Type:
For Salary Income:
Form-16 or Salary Slips received from your employer
Pension Statement/Passbook
For House/Property Income:
Address of the property
Co-owner details (if applicable)
Interest certificates/Repayment certificate from a bank (for property loan)
Important Keyword: Business and Profession Income, Income Heads, ITR Form, ITR-3.
Table of Contents
What is ITR-3 form?
The ITR-3 form is designed for individuals and Hindu Undivided Families (HUFs) who earn income from a business or profession. This form is also appropriate for those who receive income from a partnership firm or Limited Liability Partnership (LLP). Simply put, you need to file ITR 3 if your income falls under the category of “Profit or Gain of Business or Profession.” Additionally, it is used when a tax audit is required.
Up until FY 2018-19 (AY 2019-20), it wasn’t mandatory to file an Income Tax Return if your total income was below the basic exemption limit. However, the 2019 Budget introduced the seventh proviso to Section 139(1). According to this provision, taxpayers must file an ITR even if their total income does not exceed the basic exemption limit if they have engaged in certain high-value transactions. These transactions include:
Depositing more than INR 1 crore in a current account
The ITR-3 form is meant for individuals and Hindu Undivided Families (HUFs) who have income from various sources, including:
Partners in a Partnership Firm or LLP:
If you are a partner in a partnership firm or an LLP, you need to file ITR 3.
Income from Multiple Sources:
Individuals earning income from salary, house property, capital gains, and other sources, along with “Profits or Gains of Business or Profession,” must file ITR 3.
Non-Eligibility for Presumptive Taxation:
Those not eligible for the Presumptive Taxation Scheme under Section 44AD, 44ADA, or 44AE should use ITR 3.
Who Cannot File ITR-3?
The ITR-3 form cannot be used by certain entities, including:
Separate Legal Entities:
Partnership firms, LLPs, companies, and charitable trusts cannot file ITR-3. These entities have to use other specified forms suitable for their structure and income types.
Structure of ITR Form 3
Part/ Schedule
Heading
Fields
PART A- GENERAL
Personal Information
Name, Address, Date of Birth, PAN, contact details, etc.
Filing Status
Employer Category, Tax status, Residential status, Return filed under the section, etc.
PART B-TI
Computation of total income
PART B-TTI
Computation of tax liability on total income
The Bank Account details, Verification and TRP details (if any) are to be provided here
Schedule IT
Details of Advance Tax and Self Assessment Tax Payments
BSR code, Date of Deposit, Chalan number, Tax Paid
Schedule TDS
TDS1: Details of Tax Deducted at Source from SALARY
TAN of Employer, Employer Name, Tax Deducted, etc.
Schedule TDS
TDS2: Details of Tax Deducted at sources from Income other than Salary (As per FORM 16A)
TAN, Name of Deductor, Year of Deduction, Tax deducted, etc.
Schedule TDS
TDS3: Details of tax deducted at source on sale of immovable property u/s 194IA (Form 26QB)
PAN & Name of the Buyer, TDS-certificated Number, TDS Amount, etc.
Schedule TCS
Details of Tax Collected at Source (TCS) [As per Form 27D issued by the collector]
TDS/TCS Number of the Collector, Name of the Collector, Tax Collected, Amount being Claimed
Schedule S
Details of Income From Salary
Name and PAN of the Employer, Address of the Employer, Salary, Perquisites, Allowance, etc.
Schedule HP
Details of Income from House Property
Details of House Property, Name and PAN of the Co-owners and Tenants, Details of Rent Income, Interest payable on Borrowed Capital, etc.
Schedule IF
Information regarding partnership firm in which you are a partner
Name and PAN of the Firm, Whether the firm is liable to audit?, Percentage share in profit, Amount of share in the profit, Capital balance as on 31st March in the firm.
Schedule BP
Details of Income from Firm of which you are a partner
Salary, bonus, commission or remuneration, Interest received from the firm on capital, expenses, Net Income
Schedule CG
Capital Gains
Details about the Short term and Long term capital gains, Sales consideration, Cost of Acquisition, Deductions under section 54, 54B, 54EC, 54F, 54GB, etc.
Schedule OS
Income from Other Sources
Dividend, Interest, Rental Income from machinery, Winnings from lotteries, Crossword puzzles, Races, Games, etc.
Schedule CYLA
Details of income after setoff of current year losses
Schedule BFLA
Details of income after Set off of Brought Forward Losses of earlier years
Schedule CFL
Details of Losses to be carried forward to the future years
Schedule VI-A
Deductions under Chapter VI-A
Deductions under section 80C, 80CCC, 80CCG, 80D, 80DDB, 80E, 80G, 80TTA etc.
80G
Details of donations
Name of Donee, Address, city or district, state code, PAN of Donee, amount, etc.
Schedule SPI
The income of specified persons (spouse, minor child, etc.) included in the income of the assessee (income of the minor child, in excess of Rs. 1500 per child, to be included)
Name and PAN of person, relationship, nature of income, amount
Schedule SI
Income chargeable to income tax at special rates
Description of special rate income, Special rate, Income, Taxable income after adjusting min. chargeable to tax, Tax thereon
Schedule EI
Details of Exempt Income (Income not to be included in Total Income)
Interest income, Dividend, Agricultural income, etc.
Schedule FSI
Details of Income from outside India and tax relief
Country, Head of income, Income from outside India, Tax paid outside India, Tax payable in India, Relevant article of DTAA if relief is claimed u/s 90 or 90A.
Schedule TR
Summary of tax relief claimed for taxes paid outside India
Details of tax relief claimed
Schedule 5A
Information regarding the appointment of income between spouses governed by Portuguese Civil Code
Name and PAN of the spouse, Income received under different heads, Amount appointed in the hands of the spouse, TDS details, etc.
Schedule FA
Details of Foreign Assets and Income from any source outside India
Details of foreign bank accounts, financial interest in any entities, Immovable properties, Other Capital Assets, etc.
Schedule AL
Asset and Liability at the end of the year (other than those included in PART A – BS of the return of the firm in which you are a partner) [Applicable in a case where total income exceeds Rs. 25 Lakh]
Particulars of Assets and Liability
Filing your income tax return (ITR) is a crucial annual task, and understanding the process can sometimes feel overwhelming. To simplify things, let’s break down the essentials step by step.
Part A: General
When filling out your ITR-3 form, attention to detail is key. Ensure every section is completed as indicated. If a particular schedule or item doesn’t apply to you, mark it with “NA” or “Nil.” For negative figures or losses, precede the figure with a hyphen (-). All figures should be rounded off to the nearest rupee, but when it comes to total income, round off to the nearest multiple of ten rupees.
Sequence for Filling Parts and Schedules
Follow this sequence for a smooth filing process:
Part A- General
Schedules
Part B-TI and Part B-TTI
Verification
Details relating to TRP (Tax Return Preparer) and counter signature of TRP if applicable
Documents Needed to File ITR-3 Form
Gather these essential documents before starting:
PAN (Permanent Account Number)
Bank Account Details
TDS Certificates
Counterfoils of Taxes Paid
Details of Original Return if Filing Revised Return
Details of Notice if Filing in Response to a Notice
Additionally, prepare documents based on your income type:
Salary Income: Form-16 or Salary Slips from your employer, and Pension Statement/Passbook.
Other Sources: Savings/current account statements, interest certificates, dividend warrants, rent agreements (for let-out machinery), and details of any other income receipts.
Capital Gains: Documents such as sales and purchase deeds, contract notes, cost of purchase, improvement costs, and details of expenses incurred on the transfer of capital assets.
How to File ITR-3?
You have two options: physical submission or electronic filing. Since the financial year 2013-14, electronic filing has been compulsory for taxpayers with incomes exceeding INR 5 lakhs.
For Physical Submission:
Submit the ITR-3 in paper form or a bar-coded return form.
The department will provide you with an acknowledgment stamped with the submission details.
For Online/Electronic Submission:
Submit the ITR-3 online after digitally signing it, or submit it online and send the signed verification (ITR-V) to the Central Processing Center, Bangalore, within 120 days.
Alternatively, use the e-verification option to avoid sending the ITR-V and streamline the process.
Sample ITR 3 Form AY 2021-22
Major Changes in ITR 2 for AY 2021-22
Taxpayers now have the option to choose between the old and new tax regimes. Additionally, dividend income must be added with quarterly breakdowns for accurate calculation of interest under Section 234C.
Filing your ITR shouldn’t be daunting. With this simplified guide, you’re equipped to navigate the process smoothly.
Important Keyword: Income Heads, ITR Documents, ITR-4, Presumptive Tax.
Table of Contents
What is ITR-4 form?
The ITR-4 form is designed for taxpayers who have chosen the presumptive taxation scheme under Section 44AD, Section 44ADA, or Section 44AE of the Income Tax Act. This scheme is intended to simplify the tax filing process for small businesses and professionals by allowing them to declare income at a prescribed rate without maintaining detailed books of accounts.
However, if your business turnover exceeds INR 2 crores (or INR 50 lakh for professionals), you will need to file ITR 3 instead of ITR 4. This is because the presumptive taxation scheme is only applicable within these turnover limits. When your income surpasses these thresholds, more detailed reporting is required, which is accommodated by ITR 3.
To file your tax returns, you can download the appropriate income tax utility from the official income tax department website. This tool will help you in filling out and submitting your ITR form accurately.
Until FY 2018-19 (AY 2019-20), it wasn’t mandatory to file an Income Tax Return if your total income was below the basic exemption limit. However, with Budget 2019, a new provision was added to Section 139(1), making it compulsory to file an ITR if you engaged in certain high-value transactions, even if your total income is below the exemption threshold. These transactions include:
Depositing more than INR 1 crore in a current account.
Certificate from Specified Medical Authorities (in case of disability)
Receipts/Proof of any other tax-saving investments/contributions
ITR-4 Form Breakdown:
The ITR-4 form consists of six sections:
Personal Information
Gross Total Income
Disclosures
Total Deductions
Taxes Paid
Total Tax Liability
How to File the ITR-4:
You can file your ITR 4 either physically or electronically. Since FY 2013-14, electronic filing is mandatory for taxpayers who:
Have an income of more than INR 5 lakhs
Own assets outside India, including financial interests in any entity, or have signing authority in any account outside India
Claim relief under Section 90/90A/91, requiring Schedule FSI and Schedule TR to be completed
Physical Submission:
Submit the ITR 4 in paper form or as a bar-coded return form duly filled.
The income tax department will provide you with an acknowledgment and a stamped submission copy.
File ITR-4 Online using Income Tax Website
Log in to the e-filing portal using your user ID & password.
Click on e-file > Income Tax Returns > File Income Tax Return from the dashboard
Select the appropriate assessment year
Select the online mode of filing the ITR
Select the applicable status and click on proceed
Select the ITR 4 option from the list provided
Read the instructions and click on the option to proceed
Select the options that are applicable to your particular situation and click on proceed
Review the prefilled data and click on proceed
Enter your income and deduction details in the different section
You will be shown a summary of your tax computation based on the details you provided. If there is tax liability payable based on the computation, you will receive the option to pay instantly or pay later
After paying tax, click Preview Return. If there is no tax liability payable, or if there is a refund based on tax computation, you will be taken to the Preview and Submit Your Return page
Once validated, on your Preview and Submit your Return page, click Proceed to Verification
On the Complete your Verification page, select your preferred option and click Continue
ITR 4 for AY 2021-22
Major Changes in ITR 2 for AY 2021-22
Old Tax Regime: This regime allows various deductions and exemptions (like HRA, 80C, 80D, etc.) but comes with higher tax rates.
New Tax Regime: This regime offers lower tax rates but does not permit most deductions and exemptions. Taxpayers need to evaluate their financial situations to choose the most beneficial option.
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