The Central Board of Direct Taxes (CBDT) which is a part of Revenue and Ministry of Finance, is responsible for administration of direct taxes through IT Department.
The CBDT will soon have a single-window financial information database of taxpayers which has a 360 degree profiling of income, source of income and spending.
CBDT will improve data mining and business intelligence vis-a-vis the database which has information like TDS, annual information reports, excise, service tax and value added tax (VAT).
There are around 3.5 crores ITR filed annually, and the tax department selects 3 to 4 Lakh cases for scrutiny based on risk profiling.
Income Tax Return or ITR is the process of declaring total income of an individual or a firm, to the IT Department of India at the end of each financial year.
Financial Year: The financial year begins on 1st April of the current year and ends on 31st March of the next year.
Assessment Year: This is the year which follows the Financial Year. FY is the year you earn the income and AY is the year you pay tax on the income earned in FY.
Claiming of tax refund: Let’s say TDS or Tax Deducted at Source, has been deducted from an investment. If your salary is below the minimum tax exemption limit, you can claim tax refund after filing ITR.
Loan processing: When you apply for loans, the eligibility and the quantum of loans depends on income and the income proof is ITR. Income Tax Returns shows total income earned during the year and taxes deducted on it.
Carry Forward Losses: Income Tax rules allow carry-forward of losses and set them off against capital gains, if you file ITR in the relevant assessment year. You can carry forward losses incurred and set it off against income of subsequent years.
Compensation: ITR establishes income proof to arrive at the compensation if applicable
The CBDT will soon have a single-window financial information database of taxpayers which has a 360 degree profiling of income, source of income and spending.
CBDT will improve data mining and business intelligence vis-a-vis the database which has information like TDS, annual information reports, excise, service tax and value added tax (VAT).
There are around 3.5 crores ITR filed annually, and the tax department selects 3 to 4 Lakh cases for scrutiny based on risk profiling.
What are the income tax return?
Income Tax Return or ITR is the process of declaring total income of an individual or a firm, to the IT Department of India at the end of each financial year.
Financial Year: The financial year begins on 1st April of the current year and ends on 31st March of the next year.
Assessment Year: This is the year which follows the Financial Year. FY is the year you earn the income and AY is the year you pay tax on the income earned in FY.
Benefits of filing Income Tax Returns when income is below exemption slab:
Claiming of tax refund: Let’s say TDS or Tax Deducted at Source, has been deducted from an investment. If your salary is below the minimum tax exemption limit, you can claim tax refund after filing ITR.
Loan processing: When you apply for loans, the eligibility and the quantum of loans depends on income and the income proof is ITR. Income Tax Returns shows total income earned during the year and taxes deducted on it.
Carry Forward Losses: Income Tax rules allow carry-forward of losses and set them off against capital gains, if you file ITR in the relevant assessment year. You can carry forward losses incurred and set it off against income of subsequent years.
Compensation: ITR establishes income proof to arrive at the compensation if applicable
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