The task of filing Income Tax returns can be quite daunting for many due to the plethora of forms involved. However, in reality, it isn’t as complex as it seems. Here is a quick guide to help you understand the typical documents and forms required for filing returns. A clear understanding helps you file your returns correctly and accurately.
Documents for Evidence of Income
1) **Form 16**
Form 16 is the certificate of Tax Deduction at Source (TDS), given by employers. At the end of each financial year, your employer must mandatorily issue a Form 16 detailing the salary income earned in the year along with the tax deducted on your behalf. It is, however, not compulsory to issue a Form 16 if there has been no TDS deduction in that year. In cases where you have worked in two different companies in a financial year, Form 16 would have to be obtained from both places.
2) **Form 12B**
This form is issued by the employer if your income is over and above Rs. 1,50,000. It details all particulars of perks and fringe benefits given by the employer in the financial year.
3) **Form 16A**
Form 16A details incomes and TDS from sources other than salary. This includes interest on securities, rental income, winnings from lottery and horse races, insurance commissions, payments in respect of deposits under the National Savings Scheme, and fees for professional or technical services. You would have to obtain this statement from each source of income.
Forms for Filing Returns
The new system of filing income tax returns introduced by the government prescribes various forms based on the nature of income earned during the year.
4) **ITR-1**
The ITR-1 is the most basic form used to file returns. This form is for all individuals with income from salary, pension, income from agriculture, and deposit interest. The ITR-1 form is not applicable for those with income from house property (rental income or proceeds from the sale of property), business, brought forward loss of earlier years, or those with capital gains.
5) **ITR-2**
For individuals and Hindu Undivided Families (HUF) with income from activities other than business, or on account of being a partner in a partnership firm, ITR-2 is the applicable form. This form is for those with capital gains arising from the sale of property, stocks, mutual funds, house property, interest from National Savings Certificates (NSCs), other interest-bearing instruments, and rental income from a house.
6) **ITR-3**
Form ITR-3 is meant for those individuals and HUFs who are partners in firms. It is also applicable if you are filing returns on behalf of an HUF that is a partner in a firm. The ITR-3 is not applicable for those carrying out any business under proprietorship.
7) **ITR-4**
The ITR-4 form is meant for individuals and HUFs who are carrying out business transactions and activities under proprietorship. The form is not applicable for any other business activity that is not a proprietary business.
From India, Ahmadabad
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34Documents for Evidence of Income
1) **Form 16**
Form 16 is the certificate of Tax Deduction at Source (TDS), given by employers. At the end of each financial year, your employer must mandatorily issue a Form 16 detailing the salary income earned in the year along with the tax deducted on your behalf. It is, however, not compulsory to issue a Form 16 if there has been no TDS deduction in that year. In cases where you have worked in two different companies in a financial year, Form 16 would have to be obtained from both places.
2) **Form 12B**
This form is issued by the employer if your income is over and above Rs. 1,50,000. It details all particulars of perks and fringe benefits given by the employer in the financial year.
3) **Form 16A**
Form 16A details incomes and TDS from sources other than salary. This includes interest on securities, rental income, winnings from lottery and horse races, insurance commissions, payments in respect of deposits under the National Savings Scheme, and fees for professional or technical services. You would have to obtain this statement from each source of income.
Forms for Filing Returns
The new system of filing income tax returns introduced by the government prescribes various forms based on the nature of income earned during the year.
4) **ITR-1**
The ITR-1 is the most basic form used to file returns. This form is for all individuals with income from salary, pension, income from agriculture, and deposit interest. The ITR-1 form is not applicable for those with income from house property (rental income or proceeds from the sale of property), business, brought forward loss of earlier years, or those with capital gains.
5) **ITR-2**
For individuals and Hindu Undivided Families (HUF) with income from activities other than business, or on account of being a partner in a partnership firm, ITR-2 is the applicable form. This form is for those with capital gains arising from the sale of property, stocks, mutual funds, house property, interest from National Savings Certificates (NSCs), other interest-bearing instruments, and rental income from a house.
6) **ITR-3**
Form ITR-3 is meant for those individuals and HUFs who are partners in firms. It is also applicable if you are filing returns on behalf of an HUF that is a partner in a firm. The ITR-3 is not applicable for those carrying out any business under proprietorship.
7) **ITR-4**
The ITR-4 form is meant for individuals and HUFs who are carrying out business transactions and activities under proprietorship. The form is not applicable for any other business activity that is not a proprietary business.
From India, Ahmadabad
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Good information given by a knowledgeable poster. Additional facts to be remembered:
Declare interest from Saving bank accounts (exemption only up to Rs 10,000). The income tax department definitely scrutinizes the declaration of savings account interest. Interest on Recurring Deposit accounts and Fixed Deposits is taxable. Use the correct Income Tax Return (ITR) form. If you changed jobs during the assessment year, declare both incomes and pay any due taxes. Remember, ITR forms are legal documents when filled out and submitted. Keep a copy of the file safe and hope that no queries arise from the Income Tax Office.
From India, Pune
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Declare interest from Saving bank accounts (exemption only up to Rs 10,000). The income tax department definitely scrutinizes the declaration of savings account interest. Interest on Recurring Deposit accounts and Fixed Deposits is taxable. Use the correct Income Tax Return (ITR) form. If you changed jobs during the assessment year, declare both incomes and pay any due taxes. Remember, ITR forms are legal documents when filled out and submitted. Keep a copy of the file safe and hope that no queries arise from the Income Tax Office.
From India, Pune
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Circular No 1-2018 Processing of income-tax returns under section 143(1) of the Income-tax Act .pdf
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