Income Tax In Easy Way
Income Tax In Easy Way
This article helps you to know about income tax and its various related information.
Why Government charges Tax?Read here
- Govt. of India provides many kind of services to its resident people or to the non-residents such as infrastructure facility, security etc. and moreover a place where people can earn and live.
- In providing these facilities govt. incurs a huge amount of expenditure and to meet those expenditures, Govt. needs funds and there is no specific source from which govt. can generate revenue.
- Therefore, we can say tax is a fees charged by the govt. against the services provided.
- Govt. major source of revenue is tax (Direct tax and Indirect tax)
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What’s new with the income tax forms this year?
The Government has introduced several new changes to the income tax forms. Take note of these changes before you proceed to file your income tax return. These change are not exhaustive since there are a few minor changes as well.
Income tax filing deadline extended
The deadline to file your income tax return has been extended by a month to August 31st. This is to give taxpayers more time to file their income tax return.
Disclosure of bank account information
Details of all bank accounts held at anytime during the financial year must be reported in your income tax return. This is asked in all the forms. Dormant accounts, those that are inoperational since the past 3 years, can be left out.
Joint bank accounts must also be included.
The type of bank account(savings or current account), name of the bank, its IFSC code must be included. Taxpayers have to choose where they want to receive refund, irrespective of whether there is a refund due in the return or not.
Mention of Aadhar card number
Taxpayers who hold an Aadhaar card have to mention it in their income tax return. This has been added in all the new forms.
ITR-V, the 1-page verification document that has to printed, signed and sent to the Income Tax Department in Bangalore, has been made optional for those who have an Aadhar card. Details though are still awaited on how the Aadhar card would be linked to the income tax return.
Mention of passport number
Taxpayers with a passport must enter their passport number in the income tax return with the exception of those filing ITR-1. Earlier, it was proposed that details of foreign travel will have to extensively reported in the income tax return. This has been rolled back and now a mention of the passport number will be enough.
Reporting foreign assets and income in ITR-2
Resident individuals with foreign accounts, foreign assets and income have been asked to provide more details of their holdings in the income tax return under Schedule FA.
Additional details such as date of opening of account or date of acquisition of the asset, interest accrued or income earned in the account and offered to tax in the return have been asked in the new forms.
The income tax department has introduced a new form called the ITR-2A for those who have salary income, own more than one house property and DO NOT have income from capital gains. Until now, such taxpayers filed their return on the ITR-2 Form. They will now be filing the much shorter Form 2A. However, if the taxpayer has long-term capital gains on which Securities Transaction Tax (STT) is paid which are exempt from tax, this form can still be used. NRIs can file ITR-2A, if applicable, however residents who have a foreign asset or foreign income CANNOT file this form.
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