Income Tax: Five golden rules to remember while filing ITR
Form no 16 is issued once in a year, on or before 31st May of the next year immediately following the financial year in which tax is deducted.
Last date to file Income Tax Return is just three weeks away. If you have not filed it yet, then do not delay further.
If you are filing it for the first time, you may find ITR filing process complicated. But you can make it simple.
Firstly, you should know your "taxable Income". Taxable income is the total of all incomes excluding all exemptions and deductions. An individual’s tax is calculated on this amount.
Secondly, you need to know about Form 16. Income Tax Form 16 is a certificate from your employer. It certifies that TDS has been deducted on your salary by the employer. If an employer deducts TDS on salary, he must issue income tax Form 16 as per tax rules of India.
Form no 16 is issued once in a year, on or before 31st May of the next year immediately following the financial year in which tax is deducted, ClearTax explained.
Also, if you are a freelancer, professional or consultant, and your salary is less than 50 lakh, then using the Presumptive Taxation Scheme under Section 44ADA of the Income Tax Act, you can actually pay income tax on only half of your gross annual income.
Apart from this, to make your ITR filing just clicks away, Archit Gupta, CEO and Co-founder, ClearTax tells five golden rules to follow:
1. File your income tax returns online. It reduces the probability of errors
2. If you have a refund, it is compulsory to file your return online for the refund to be processed.
3. Reporting all bank accounts and foreign assets and income of a resident individual and including interest income in the income tax return is often forgotten by the return filers.
4. The filers should make sure that they claim all the deductions for which they have made an investment or incurred an expenditure.
5. Many individuals who file their return forget to e-verify their income tax returns. Tax returns can be verified online via the income tax department website or by generating an OTP via Aadhaar linkage or through net-banking. A return which is not verified is not considered as filed.