Our team of experienced and expert Chartered Accountants has industry experience of over two decades, which enables us to provide our clients with the best consultancy in reducing their tax liabilities and significant tax reliefs.
We understand that filing income tax returns can be a complicated process, and therefore, we help our clients in calculating their correct income tax payable or refundable and filing their returns on time.
Income Tax Return Filing Service
An income tax return is a form in which a person files information on their income earned during a financial year and its tax thereon to the Income Tax Department. It is mandatory for individuals, HUFs, Firms or LLPs, companies, NGOs, Societies, Trusts, etc., to file their ITRs within the due dates prescribed under the act. Those who earn less than the amount chargeable to tax can also submit their returns voluntarily.
Benefits of Filing Income Tax Returns
Filing income tax returns is not only a legal obligation but also has various benefits, including:
- Avoidance of penalties: One of the most significant benefits of filing ITRs is avoiding any penalties. Failure to file ITRs on time can lead to hefty penalties and interest charges. Therefore, filing ITRs on time can help individuals avoid these unnecessary costs.
- Quick loan approvals: Filing ITRs also makes it easier to avail of loans such as home loans, car loans, or personal loans. Banks and other lending institutions often require proof of income, which can be easily obtained through ITRs.
- Establishing financial credibility: Filing ITRs can help individuals establish financial credibility with various agencies, such as banks, credit card companies, and insurance providers. This can help in getting better interest rates, higher credit limits, and better insurance policies.
- Claiming tax refunds: If the taxes paid by an individual are higher than the actual tax liability, then filing ITRs can help claim a refund of the excess taxes paid. This can result in a considerable amount of money back in the individual’s pocket.
- Proof of income: ITRs are a valid proof of income and can be used as evidence of income for various purposes such as applying for visas, loans, credit cards, and scholarships.
- Avoidance of legal troubles: Filing ITRs can also help individuals avoid any legal troubles with the tax authorities. Filing ITRs regularly and correctly can prevent any potential legal issues that may arise due to non-compliance with tax laws.
Reasons why to File Income Tax Returns by Individual taxpayers?
Filing income tax returns is essential for individual taxpayers for various reasons. Some significant benefits of filing income tax returns are:
Getting Loans and Credit Cards Approved
ITR copies are mandatory to get various loans and credit card approvals, including housing loans, vehicle loans, personal loans, and business loans. Without a copy of ITR, getting approval for such loans can be challenging.
Quick Visa Approvals
To obtain visa approvals, it is mandatory to produce proof of income tax returns along with other essential documents required by the immigration department.
Claiming Income Tax Refunds and Business Losses
Filing income tax returns is necessary to claim any income tax-related refunds and business losses from the IT department. Filing returns is also essential to carry forward previous year losses.
Avoiding Penalties and Prosecution
Failure to file the return of income when required can result in punitive provisions in the form of fines, penalties, and prosecution under the income tax act. It is advisable to file returns on your own or hire a professional, such as an income tax consultant, to ensure compliance with the law.
ITR Filing for HUF
A Hindu Undivided Family (HUF) is treated as a separate entity for assessment under the Income Tax Act. HUF consists of Father, sons, and daughters, and the Karta can deliver his share in the co-parcenary to his wife. The provisions of computing income of the HUF are the same for a normal person. Ahuja & Ahuja Chartered Accountants can help you in forming HUF as well as in filing the income tax return.
ITR Filing for Partnership Firms
Partnership firms are a popular business structure in India, where two or more individuals come together to form a business entity. A partnership firm can either be registered or unregistered. A registered partnership firm is one that has obtained a registration certificate from the Registrar of Firms. An unregistered partnership firm, on the other hand, does not have a registration certificate.
Under the Income Tax Act, 1961, a partnership firm is required to pay tax at a flat rate of 30%, along with a 12% surcharge if the taxable income exceeds Rs. 1 crore. Additionally, a 4% health and education cess is also applicable. It is important to note that a partnership firm is a separate legal entity from its partners, and is required to pay income tax, irrespective of whether it is registered or not.
To file tax returns for a partnership firm, the Form ITR-5 needs to be submitted. This form is specifically used for filing tax returns for partnership firms, while a separate form is available for individual tax filing of partners. The process for submitting the ITR-5 form can be completed online through the income tax department’s portal.
Ahuja & Ahuja Chartered Accountants can assist you in filing tax returns for your partnership firm, irrespective of whether it is registered or not. Our team of experienced professionals is well-equipped to handle all aspects of tax compliance, including preparation and filing of returns, ensuring timely and accurate filing.
So, if you’re looking for a reliable and experienced tax consultant for ITR filing of your partnership firm, get in touch with us today.
ITR Filing of NGO/Trusts/Society
Filing income tax returns for trusts, NGOs, and societies can be a complex process due to their unique tax mechanism. Unlike businesses, trusts cannot claim deductions for all expenditures incurred, as there is no direct link between the income received and expenses incurred for charitable causes. To avail of deductions for amounts applied towards charitable purposes, trusts must obtain registration under Section 12A of the Income Tax Act-1961, which is a one-time procedure.
Once registered, trusts can claim exemptions provided under the Income Tax Act, and funds used for charitable or religious purposes are deemed as the application of income and are exempt from taxation. Additionally, registered trusts can set apart 15% of their receipts for charitable purposes, which is granted as an application of income under Section 11(2) and is not considered a part of the trust’s total income.
Registration under Section 12A lasts until it is cancelled by the Commissioner of Income Tax (Exemption), and there is no requirement for renewal. Charitable trusts, religious trusts, societies, and Section 8 companies claiming exemption under Sections 11 and 12 of the Income Tax Act must obtain 12A registration.
Dealing with such critical matters can be cumbersome for taxpayers, which is why it is important to hire the right professional expert.
Frequently Asked Questions on ITR filing
If you’re filing your income tax return, you may have a few questions in mind. We’ve put together some commonly asked questions and their answers below:
What documents do I need to file my ITR?
The documents required to file your income tax return include your PAN Card, Aadhaar number, income tax login credentials, bank statement, investment proof for claiming deductions, TDS certificates (Form 16 or 16A), records of sale or purchase of assets/investments, and proof of payment of insurance premium, PPF, purchase of NSCs, mutual funds, donations, etc.
Should I file my ITR if TDS is deducted?
Yes, even if TDS is deducted, you should file your income tax return. Filing your ITR is essential if you want to claim a refund. If you don’t file your ITR, you may receive a notice from the department.
How do I pay my income tax?
You can pay your income tax by using challan 280 self-assessment tax through net banking.
Can I file an income tax return for the year I missed?
Yes, you can file an income tax return for the year you missed by filing a belated return. The belated return can be filed up to 31st December following the relevant financial year. For example, the belated return of F.Y. 2021-22 can be filed up to 31.12.2022. However, for F.Y. 2020-21, the due date for filing the belated return has been extended to 31st March 2022 by the Income Tax Department.
What is e-verification of ITR, and how is it done?
Electronic Verification Code (EVC) is a code sent to the registered mobile number of the tax filer while filing his/her returns online. It helps verify the identity of the tax filer. An EVC can be generated through the e-filing portal of the Income Tax Department. After successfully e-verifying your ITR, you’re not required to send physical ITR-V to Bangalore for further processing. You can verify your ITR electronically via Aadhaar OTP, net banking, or EVC on the Income Tax website.
Do I need to attach any documents while e-filing my ITR?
No, you don’t need to attach any documents while e-filing your income tax return. However, you should keep all the necessary documents safely so that you can provide them to the department if required during scrutiny or assessments.