The finance ministry said on Thursday that salaried persons having total annual income of up to R5 lakh would not have to file tax returns for the assessment year 2011-12, a move that would benefit around 85 lakh taxpayers.
Notifying the decision, the Central Board of Direct Taxes (CBDT) said that individuals having total income up to R5 lakh for financial year 2010-11, after allowable deductions and consisting of salary from a single employer and interest income up to R10,000 from deposits in a savings bank account, were not required to file their income tax returns.
?Such individuals must report their Permanent Account Number (PAN) and the entire income from bank interest to their employer, pay the entire tax by way of deduction of tax at source, and obtain a certificate of tax deduction in Form No.16,? CBDT chairman Prakash Chandra said.
However, persons receiving salary from more than one employer, having income from sources other than salary and interest income from a savings bank account, or having refund claims, will not be covered under the scheme. ?The scheme will benefit only the lower income group or persons who have just started their carrer. If you want to claim refunds, then tax return has to be filed,? Deloitte Tax Partner Homi Mistry said.