Personal Tax Return Filing

Personal tax return filing in India is when individuals submit their annual income details and information on deductions and taxes paid to the Income Tax Department. This is done using specific forms, known as Income Tax Returns (ITRs), which vary based on the individual's income sources, such as salary, business income, capital gains, and other sources. Filing a tax return is to report your income and pay the appropriate taxes to the government. It's mandatory for those whose income exceeds the basic exemption limit set for the financial year. The income tax filing process can be completed online via the e-filing portal.

Personal income tax return filing need to be filed by following persons:

• Salaried Individuals: Those who earn a salary and whose income exceeds the tax-exempt threshold. Personal income tax filing need to be filed by following persons:

• Individuals and Hindu Undivided Families (HUFs): Those not involved in business or professional pursuits but with other sources of income, such as investments, property, or capital gains, that bring their total income above the tax-free limit.

As mentioned above, the Income Tax Department of India provides a range of ITR forms, from ITR-1 to ITR-7, designed to cater to different taxpayers based on their income sources, amount, and complexity. The following two forms need to be submitted for Personal Income Tax Filing:

• ITR-1 (SAHAJ)
• ITR-2

The ITR-1 Sahaj Form is designed to simplify the tax filing process for individual taxpayers in India, particularly aimed at residents with a total income of less than Rs. 50 lakhs. This form accommodates income from specific sources such as:

• Salary or Pension
• A single-house property
• Other miscellaneous sources

ITR-1 income tax filing is intended for Resident Individuals under the following conditions:

• Income Limit: The individual's total income during the financial year should be Rs. 50 lakh.

• Applicable Income Types: Eligibility for ITR-1 includes individuals earning income from:

• Salary

• One house property

• Family pension (up to Rs. 5,000)

• Other sources, such as:

• Interest from Savings Accounts

• Interest from Deposits (Bank/Post Office/Cooperative Society)

• Income Tax Refund Interest

• Interest on Enhanced Compensation

• Other Interest Income

• Family Pension

• Income Aggregation: Income can be combined with that of a spouse or minor only if it aligns with the specified categories above.

ITR-2 is used in India by individuals and Hindu Undivided Families (HUFs) with income that does not include profits and gains from business or professional activities. It's specifically designed for those with diverse income sources, excluding business or professional earnings.

Who Should File ITR-2?

You're eligible to file ITR-2 income tax filing if you have income from the following sources:

• Salary or Pension: This includes all earnings from employment or post-retirement benefits.

• Multiple House Properties: Income from renting out or owning more than one property.

• Capital Gains: This includes profits or losses from selling assets like stocks, bonds, or property, covering both long-term and short-term transactions.

• Other Sources: This category includes various incomes such as lottery winnings, bets on racehorses, and other legal gambling earnings.

• Agricultural Income: If you earn more than Rs 5,000 from farming or similar agricultural activities.

• Foreign Income or Assets: This applies if you have earnings from abroad or own assets outside India.

• Residential Status: It's suitable for either Resident Not Ordinarily Resident (RNOR) or Non-Residents.

• Directorship: If you hold a directorial position in any company, whether listed or unlisted.

When income tax filing in India, ITR-1 and ITR-2 forms are designed to be annexure-less, meaning you're not required to attach any supporting documents during submission. However, having the right documents is crucial for a smooth and accurate filing experience.

• Aadhaar Card

• PAN Card

• Bank account details

• Form 16 (salary and TDS information)

• Form 26AS (tax credit statement)

• Receipts for tax exemptions or deductions (if applicable)

• Bank interest statements

• Capital gains statements (for asset sales)

• Documents related to foreign assets and income (if applicable)

For personal tax return filing in India, the general deadline for individuals filing ITR-1 and ITR-2, without needing a tax audit, is 31st July of the assessment year that follows the financial year in question.

A late filing fee of Rs 5,000 will be charged for income tax filing between 31 July 2023 and 31 December 2023. Small taxpayers whose total income is below Rs 5 lakh will benefit from a reduced penalty of Rs 1,000 for late filing within this period.

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Personal tax return filing in India is when individuals report their annual income and taxes to the Income Tax Department using specific forms known as Income Tax Returns (ITRs). This process is mandatory for those whose income exceeds the basic exemption limit set for the financial year.

Personal tax returns should be filed by individuals whose income exceeds the tax-exempt threshold, including: Salaried Individuals
Individuals and Hindu Undivided Families (HUFs) with other sources of income such as investments,
property, or capital gains, bringing their total income above the tax-free limit.

For personal tax filing, individuals use various ITR forms, including ITR-1 (SAHAJ) and ITR-2, designed for different income sources and complexities.

The ITR filing charges typically vary based on various factors such as income, filing status, and complexity of the return. At Indiafiling, ITR filing charges are very affordable.

The ITR-1 Sahaj Form is specifically designed for resident individuals with a total income of less than Rs. 50 lakhs, accommodating income from specific sources such as salary, pension, and a single-house property.

ITR-1 is suitable for resident individuals with income from sources such as salary, one house property, and specified other sources, provided their total income during the financial year does not exceed Rs. 50 lakh.

ITR-2 is used by individuals and Hindu Undivided Families (HUFs) with income from various sources excluding profits and gains from business or professional activities.

ITR-2 is applicable if you have income from sources such as salary, multiple house properties, capital gains, foreign assets, and directorial positions, among others.

Essential documents for filing ITR include Aadhaar Card, PAN Card, bank account details, Form 16, Form 26AS, receipts for tax exemptions or deductions, bank interest statements, capital gains statements, and documents related to foreign assets and income.

The general deadline for individuals filing ITR-1 and ITR-2, without a tax audit, is 31st July of the assessment year following the financial year in question.