How to File Income Tax Return

What is Income Tax?

Income tax is an annual tax on income. The Indian Income Tax Act (Section 4) provides that in respect of the total income of the previous year of every person, income tax shall be charged for the corresponding assessment year at the rates laid down by the Finance Act for that assessment year. Section 14 of the Income tax Act further provides that for the purpose of charge of income tax and computation of total income all income shall be classified under the following heads of income.

A. Salaries 

B. Income from house property 

C. Profits and gains of business or profession. 

D. Capital gains 

E. Income from other sources.

The total income from all the above heads of income is calculated in accordance with the provisions of the Act as they stand on the first day of April of any assessment year. In this booklet an attempt is being made to discuss the various provisions relevant to the salaried class of taxpayers as well as pensioners and senior citizens.

How to file Income Tax return?

Section 139(1) of the Income-tax Act, 1961 provides that every person whose total income during the previous year exceeded the maximum amount not chargeable to tax shall furnish a return of income. The Finance Act, 2003 has introduced Section 139(1B) which provides for furnishing of return of income on computer readable media, such as floppy, diskette, magnetic cartridge tape, CD- ROM etc., in accordance with the e-filing scheme specified by the Board in this regard.

The return of income can be submitted in the following manner: 

(i)            a paper form; 

(ii)           e-filing

(iii)        a bar-coded paper return.

                         Where the return is furnished in paper format, acknowledgement slip attached with the return should be duly filled in.

Returns in new forms are not required to be filed in duplicate.

Returns can be e-filed through the internet.

E-filing of return is mandatory for companies and firms requiring statutory audit u/s 44AB. From A.Y. 2011-12, it is now also mandatory for all business entities (including individuals/HUF) liable to tax audit to e-file their return of income. E-filing can be done with or without digital signature-

a) If the returns are filed using digital signature, then no further action is required from the tax payers.

b) If the returns are filed without using digital signature, then the tax payers have to file ITR-V with the department within 15 days of e-filing.

c) The tax payer can e-file the returns through an e-intermediary also who will e-file and assist him in filing of ITR-V within 15 days.

Where the return of income is furnished by using bar coded paper return, then the tax payers need to print two copies of Form ITR-V. Both copies should be verified and submitted. The receiving official shall return one copy after affixing the stamp and seal.

The Finance Act, 2005 has provided that w.e.f. 01.04.2006 every person shall file a return of income on or before the relevant due date even if his total income without giving effect to the provisions of Chapter VI-A (please see Chapter 5 of this booklet) exceeds the maximum amount not chargeable to tax.