The last date for filing income tax return (ITR) for the Assessment Year 2017-18 has finally arrived. All those who have taxable income are liable to pay income tax to the government and were also required to file their tax return by July 31, 2017. However, in view of the difficulties faced by taxpayers, the due date for filing of Income Tax Returns for F.Y. 2016-2017, i.e. Assessment Year 2017-2018, was extended to 5th August, 2017. If you have still not filed your ITR, then it is time to do so today, otherwise apart from losing out on various benefits, you may also have to incur penalties.
Here are 10 things you must know and try to do today:
1. Assess your income
The first step is to identify whether or not there is an income tax filing requirement. The basic tax exemption limit for the Financial Year 2016-17 for individuals is Rs 2.50 lakh (Rs 3 lakh for individuals with age of 60 years or more and Rs 5 lakh for individuals with age of 80 years or more). If your income is more than the exemption limit, then you must file your return today.
2. Make sure to choose the correct ITR Form for AY 2017-18
- Taxpayers earning income from salary, one house property and other sources can choose ITR-1. However, this time you cannot choose ITR-1 when your income exceeds Rs 50 lakh or you are earning unexplained income or dividend income above Rs 10 lakh.
- Taxpayers earning business income need to file ITR-3. Partner of a firm will also file ITR-3.
- Now old ITR-4S has been withdrawn. Thus, taxpayers opting for presumptive taxation need to file ITR-4 instead of ITR-4S.
3. Check 26AS before filing return
Make sure to check 26AS before filing your tax return. You will get full TDS credit only when full amount of TDS is reflected in 26AS.
4. Mention details of cash deposited during demonetization
You need to mention details of cash deposited during demonetization in the Income Tax Return forms. There is a separate column in ITRs wherein you need to mention details of cash deposited above Rs 2 lakh during November 9, 2016 till December 30, 2016.
5. Disclose your assets
In the tax return, apart from income, you are required to disclose your assets as well. Individuals and Hindu Undivided Families (HUFs) whose total income exceeds Rs 50 lakh are required to disclose all assets held as on the last day of the year in ‘Schedule AL’ in ITR Form No. 2, ITR Form No. 3 and ITR Form No. 4. The assets that are required to be disclosed under this schedule are:
- Immovable assets i.e. land and building;
- Movable assets i.e. a] jewellery, bullion, b] archaeological collections, drawings, paintings, sculpture or any work of art, c] vehicles, yachts, boats and aircrafts, d] financial assets which include bank deposits, shares and securities, insurance policies, loans and advances given, and e] cash in hand; and
- Interest held in assets of a firm or association of persons as a partner or member thereof.
6. Report Aadhaar number
An important reporting requirement applicable with effect from 1 July 2017 is to report Aadhaar number / Aadhaar enrolment ID while filing the ITR. Therefore, if you already have an Aadhaar card, then you are required to link it with your PAN. If you don’t have an Aadhaar card, then you need to apply for it and mention the Aadhaar enrolment ID while filing your tax return.
7. File Form 10E for arrears of 7th Pay Commission
Last year government employees had received arrears of the 7th Pay Commission. Such employees need to file Form 10E on e-filing website before filing of tax return if they want to claim Section 89 relief.
8. Requirement for NRIs
Earlier only resident taxpayers were required to mention details of offshore bank accounts in ITR. Now there is a separate column in ITR wherein non-resident taxpayers are required to mention details of their bank accounts outside India.
9. Inability to carry forward losses
You need to know that losses from business or profession, capital loss, etc. are allowed by the Income Tax Department to be carried forward to the next assessment year. If you do not file your returns on time, you cannot carry forward any loss suffered by you to the next financial year’s tax calculations.
10. Inability to claim refund
If you are employed and receive a salary, your employer deducts TDS and then credits your salary. If you make tax-free investments, your taxable income reduces. As such, due to the TDS already deducted by your employer, if your tax liability is lower than the TDS already deducted, you would be eligible for a tax refund. Moreover, if your total income is below Rs.2.5 lakh and TDS has been deducted, you would be eligible for a tax refund. For these or any other cases where you are eligible for a refund, you have to file your taxes. Only if you file your returns, you may get an opportunity to claim a refund.