Documents and Requisite Forms Needed for Filing IT Returns in India.

Author: Apratim De, B.A LL.B, 4th Year, New Law College, Bharti Deemed to be University, Pune. Income Tax Return (ITR) filing can be a hectic process sometimes and may often lead to confusion and ambiguity. So here are some steps and documents one needs to have for filing an Income Tax Return. The steps involved in filing Income Tax Return in India are as follows:- Collection of the requisite Documents:- The first and foremost thing which one needs to do for filing their ITR is collecting the requisite documents in order to initiate the process. List of Documents required for filing ITR are as follows:- Pick the appropriate ITR Form:- Income Tax Form (ITR) is a document which consists of the details of earning of an individual and accordingly the amount of tax he/she is entitled to pay to the Income Tax Department. Accordingly the IT Department has created 7 categories of form till date ranging from ITR 1 to ITR 7. Each of these forms is different from the other as the categories each form covers is different depending upon the source of income, amount of income earned and the category to which they belong like individuals, HUF, company etc. Who should file the ITR One should file a ITR if any of the conditions given below is applicable:- (A). If the gross annual income is above Rs. 2.5 Lakh and the individual is aged below 60 years. If the gross annual income is above Rs. 3.0 Lakh and the individual is aged above 60 years but below 80 years. If the gross annual income is above 5 Lakh and the individual is aged above 80 years. (B). More than one source of income:- If an individual has more than one source of income such as property, capital gains etc. (C). To claim an IT return from the income tax department. (D). Any investment made in foreign assets or capital earned from any such assets during the Financial Year. (E). If one wants to apply for a VISA or Passport. (F). If a Taxpayer is among these individuals such as a company or a firm irrespective of profit or loss they incur. Details of which ITR Form to be filed for the Financial Year 2019-20 (AY 2020-21) ITR 1 or SAHAJ Who can File:- Any resident individual whose total income for the assessment year 2018-19 includes:- ● Income from Salary/Pension; or ● Income from One House Property(excluding cases where loss is brought forward from previous years); or ● Income from other sources ( Income earned from winning a lottery or horse race are excluded); or ● Agricultural Income up-to Rs.5000/-. Who cannot File :- ● Earning above Rs.5000/- from agriculture ● If one has access to the income of another person and the deduction of taxes in respect to the said source of income is deducted from another person. ● Owning assets including financial interest in any entity outside India if you are a resident, including signing authority in any account located outside India. ● Owning foreign assets or foreign income. ● If you are a resident, non-resident or not ordinarily resident (RNOR). ● If the taxpayer is a director of a company ● Investments in unlisted equity shares during the financial year ● Earnings from more than one house property. ● Having Taxable Capital Gains i.e. Gains earned as profits by selling of a capital asset like share stocks, a piece of land, business or a artwork ● Earnings from a business or profession. ● Taxpayers whose total income is above Rs.50 Lakhs ITR-2 Form Who can File:- Any resident individual whose total income for the assessment year 2018-19 includes:- ● Individual having income from Salary/Pension; or ● Income from House Property; or ● Income from other sources ( Income earned from winning a lottery or horse race are excluded); or Total income from the above should be more than Rs.50 Lakhs if ● The person is an individual director in a company. ● Investments in unlisted equity shares during a financial year. ● If a person is a resident, non resident, not ordinarily resident (RNOR). ● Earnings from Capital Gains; or ● Foreign Assets/Foreign Income ● Agricultural Income of more than Rs. 5000/- Who cannot File:- Any individual whose total income includes income from Business or Profession for the AY 2018-19 these individuals can declare these incomes under ITR-3 or ITR-4. ITR 3 Form:- Who can File This form can be filed by such individuals or a HUF who earns money from proprietary business or are carrying on profession. The persons earning from the below mentioned sources are eligible to file ITR 3: ● People carrying out a business or profession ● The person is an individual director in a company ● Investments in unlisted equity shares at any point of time during a financial year. ● If the return includes income from house property, salary/pension and Income from other sources. ● Income of a person as a partner in the firm. Who cannot File:- If the individuals or the HUF draw their income from a partnership or as partners from a business or profession then such individuals are not eligible for ITR filing under ITR form 3 in such a case the individuals or the HUF’s are required to file the returns under ITR-2. ITR-4 or Sugam:- Who can File:- ITR 4 is applicable to the Individuals, Hindu Undivided Family (HUF), Partnership Firm (other than LLPs) which are residents having income from a business or profession. It also includes those who have opted for presumptive income as per Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act. However if the turnover of the business is more than Rs.2 Crore, the taxpayers have to file ITR-3. Who cannot File:- The individuals who cannot use ITR-4 Form are as follows:- ● Whose income is more than Rs. 50 Lakhs. ● Having an income from more than one house property. ● If they have brought forward loss or loss to be carried forward under any head of income. ● Owning any foreign assets ● Having signing authority in any account situated outside India ● Having income from any source outside India ● Director in a company ● If a person has investments in unlisted equity shares at any time during the financial year. ● If the person is a resident, non resident, not ordinarily resident (RNOR). ● Having foreign assets or foreign income ● If you are assessable in respect of income of another person in respect of which tax is deducted in the hands of the other person. ITR-5 Who can File:- The individuals who can use ITR-5 for filing are as follows:- ● Limited Liability Partnership (LLP) ● Association of Persons (AOP) ● Body of Individuals (BOI) ● Artificial Juridical Persons (AJP) ● Estate of Deceased ● Estate of Insolvent ● Business trust and investment Fund ● Artificial Juridical person as mentioned in Section 2(21)(vi) of the Income Tax Act,1961 ● Persons as defined in Section 160(1)(iii)(iv) of IT Act 1961 Who cannot File:- ● Individual Taxpayers ● HUF ● Company ● Persons obligated to file tax under Section 139(4A), 139(4B), 139(4C), 139(4D), 139(4E), or 139(4F),i.e. ITR 7 Form. ITR-6 Who Can File Companies[1] except those which are exempted under Section-11 (Income from property held for charitable or religious purposes) can file under this form by electronic means only. Who cannot File ● Firm ● Individuals ● Hindu Undivided Family (HUF) ● Local Authority and artificial judicial person ● Body of Individuals (BOI) ● Association of Persons (AOP) ● Companies claiming exemption under Section 11 ITR-7 Purpose:- The purpose of filing ITR-7 Form is that the people who are holding properties and are receiving gains for the same are required to file IT Returns for receiving gains from such property. So as a result for the category of these people the IT Department has different policies for filing IT return. Who can File:- 1). Entities who can file ITR under this Form:- ● Section 139(4a):- Return of Charitable and Religious Trusts ● Section 139 (4b):- Requires Political Parties to file Income Tax Return in case the total income exceeds the maximum allowable tax exempt limit. ● Section 139 (4c):- Entities having income from scientific research institutions, news agencies and so on. ● Section 139 (4d):- Entities who have income from university, colleges, institutions or khadi and village industries. ● Individuals having income from the property that is in name of trust ● Government or Non-Government Educational Institutions mentioned in Section 10(23A) and Section 10(23B). 2). Linking Aadhaar with PAN Secondly for filing IT Returns the taxpayers must link their Aadhar Card with their PAN card on or before filing of the IT Return. 3). Documents required by the Salaried Employees The salaried employees need to have following documents in order to file your tax returns:- ● PAN Card ● Form-16 issued by the employer ● Month wise salary slips For the Annual Year 2019-20 it is essential to gather information on all taxable allowances received and the amount claimed exempt out of such allowances. E.g. house rent allowance, leave travel allowance etc and disclose the same in IT the Return. 4). Documents related to interest income ● Bank Statement/Passbook for interest on the savings account ● Interest income statement for Fixed Deposit. ● TDS certificate issued by banks and others. 5). Tax Credit Statement (Form 26AS )[2] Form 26AS is provided by the IT Department consisting of the information about taxes paid by the individual and the taxes deducted by the department. 6). Income Tax Deductions under Section 80C[3] Investments made under PPF, NSC, ULIPS,ELSS, LIC qualify for deductions under Section 80C. 7). Documents required to claim the following expenses as deductions:- ● Contribution to Provident Fund ● Documents of Payment of Tuition Fees of the children ● Life Insurance Premium Payment ● Stamp Duty and Registration Charges ● Principal Payment on your home loan ● Equity Linked Savings Scheme and Mutual Funds Investment ● Under Section 80C one cannot claim more than Rs. 1.5 Lakhs 8). Other Investment Documents ● Interest Paid on Housing Loan:- Tax Payers can save as much as upto Rs.2,00,000/- on interest on housing loans for self occupied houses. Interestingly for let out or deemed let out property there is no limit of interest on housing loans eligible for tax saving till FY 2016-17. Moreover from Financial Year 2017-18 the total loss from house property available for set-off against other income is capped at Rs.2 Lakhs and therefore interest on housing loan is eligible for tax saving up-to Rs. 2,00,000/- for let out property as well. ● Documents of payment of interest on Education Loans ● Documents of stock trades made during the year can be taxed under Capital Gain. 9). Documents Required for ITR Filing:- Generally for filing an ITR no annexures are required to be attached to it. The IT Act mentions obtaining certificates and proofs to claim deduction which makes it ambiguous for the taxpayers as to whom they must hand over such certificates and proofs. The taxpayers just need to procure the above mentioned documents and are not required to submit it to any particular person authority except when asked by the Assessing Officer(AO) on sending a notice seeking clarification or asking for the document as a proof for the transactions mentioned in the returns. [1] Companies registered under Companies Act 2013 or under the former act.
[2] https://www.incometaxindia.gov.in/Pages/tax-services/online-26AS-e-filing-website.aspx
[3] https://www.incometaxindia.gov.in/Pages/tools/deduction-under-section-80c.aspx DISCLAIMER: Views and opinions as expressed in the Research Articles are solely of the author and any member of the Editorial team or the Founder, Co-Founder or other members of the website shall not be liable for the same.

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