LAW DECODED

Why you must file ITR Most people incur losses or their income does not exceed basic basic exemption limit, so they think there is no need to file ITR but this notion is wrong. Everyone must file ITR because of following reason. WHY YOU SHOULD FILE INCOME TAX RETURN 1. If you do not file ITR then you can not carry forward of your losses. Carry forward of losses means that taking losses in the next year, and if you have any income next year then you may set off your previous year loss against such income.  For Example, in current year you did trading in share market and incurred a loss of Rs. 2 Lakhs but in next year your income from share market is Rs. 3 Lakhs, then first you should reduce last year loss from this income then you shall pay tax on balance amount i.e. Rs. 1 Lakh [3 Lakh - 2 Lakhs] . 2. Sometime various purposes you need last 3 or 4 years ITR such as taking credit card, applying for bank loan, passport etc. Therefore, even if you do not have any income, s...

Which ITR form you should opt for? Every year CBDT notifies new income-tax return (ITR) forms. In 2016 the CBDT had notified the ITR Forms at the end of March, 2016 and it deviated from its past practice of notifying ITR Forms in the month of May or June. This time also the CBDT has notified the ITR forms in the month of March, 2017. As per the assurance given by the Finance Minister in his Budget Speech the CBDT had finally prescribed simplified ITR 1 Form with fewer columns. However, such ITR 1 is applicable only for individuals having income up to Rs 50 lakhs. Further, Individual taxpayers either having dividend income above 10 lakhs or having unexplained credit (taxable at 60% under Section 115BBE) can't opt for ITR-1. The CBDT has scrapped ITR- 2A. Now all assessees (other than those earning salary income and business income) would be required to file ITR-2 only. Earlier taxpayers opting for presumptive taxation were required to file ITR-4S. But now they are r...

Form 16 is important document which you must have at the time filing your Income Tax Return because it contains all your income details which your employer pay you during the financial year and how much TDS is deducted. Form 16 : Form -16 is a kind of statement which is issued by the employer. It is the proof of TDS (Tax Deducted at Source) from your salary income. Form 16 contains the details of tax deduction which is made by your employer out of your salary. Sometimes, it is also called salary TDS certificate. Therefore, it is a prerequisite to cross-check the amount deducted by your employer with form 16 so as to know whether properly deducted tax has been deposited by the employer with the government. If your employer doesn’t give Form 16: Sometimes, the payer deducts the tax and tells you that he has deposited the tax to the Income Tax department. So, should you trust him or not? No way, because payer sometimes doesn’t deposit the deducted tax and as a ...