Budget 2016 had made some changes in the rules related to Income Tax Returns. We discuss these changes and what it means for the tax payers.
1. Who needs to File Income Tax Return Compulsorily?
you need to file your income tax return if your gross taxable income (without any tax saving deduction) is more than the basic tax limit applicable for you.
: you need to file your income tax return if your gross income (without any tax saving deduction) is more than the basic tax limit applicable for you. where STT (Securities Transaction Tax) has been paid which are tax free u/s 10(38).
Until last year the income tax assesses had to show the above capital gains as exempted income in the ITR form. This has been done to cover people who have earned substantial long term capital gains but do not file income tax returns.
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This would also cover people who do not have any taxable income but their long term capital gains exceed their basic tax income limit.
The is as follows:
§ For citizens below 60 years of age – Rs 2.5 Lakhs
§ Between 60 and 80 years (Senior Citizens) – Rs 3 Lakhs
§ Above 80 years (Very Senior Citizens) – Rs 5 Lakhs
There are no separate exemption based on gender as used to be historically [clarifying this as many people still search for separate limits for men and women].
2. Time limit for filing belated return
In most years the due date to file income tax return is July 31. In case you do not file ITR on or before this date, it is called belated return.
With the earlier rule, you could file your belated tax returns within two years from the respective financial year end. For e.g. 31 July 2016 is the deadline for filing ITR for the FY 2015-16 (AY 2016-17). By earlier rule, in case you do not file ITR by this date, you could still file your belated ITR by March 31, 2018.
But with the
3. Right to revise belated ITR
By the existing rule, you cannot revise your returns if it has been filed after deadline of July 31. Budget 2016 has changed this,
But if you do not file your ITR by the due date, you would loose lose your right to carry forward losses.
4. Defective Return
As per present rules assessing officer can term income tax return as defective under certain circumstances. In this case the tax payer is given 15 days period to rectify the mistake. In case the mistake is not rectified, the return is considered as invalid and is equivalent to non-filing of ITR ever. . Here if you had filed return without paying due taxes, your ITR would be termed defective and you would be given 15 days time to pay. In case you do not pay the return would be invalid and assumed that it was never filed.
Now However subsequently you’ll have to pay the dues along with interest for the delay.
The new rules are mostly tax payer friendly except the cut in the time to file belated return. We recommend you to start filing your returns from June onwards and complete it few days before the due date of July 31.