Income tax returns (ITR) filing: This is for whom ITR 3 form is for
Out of the five heads of income, the income from freelance, web-designing business shall be taxed under head ‘Profits and Gains from Business or Profession’ whereas, income from Fixed Deposits shall be taxed under head ‘other sources’.
Q. This year I will be filing taxes as a freelance web designer for the first time. I received payments from various companies. In some cases the TDS has been cut. I also have interest income from bank FDs. How do I file taxes? - Akash Vaid
A. Out of the five heads of income, the income from freelance, web-designing business shall be taxed under head ‘Profits and Gains from Business or Profession’ whereas, income from Fixed Deposits shall be taxed under head ‘other sources’. You shall be required to file ITR Form 3 giving the details of income. The Tax Deducted at Source (TDS) can be claimed as credit from the ascertained tax liability.
Q. My son and I jointly own a flat, which is given on rent. Since I am the only one taking the rental income, should my son show it in his tax returns? I can show my bank statements as proof. As a retired person my income is below the taxable limit. -S K Chheda
A. The Income Tax Law provides to tax share of each person in the income from jointly owned house property in case the shares of the co-owners are definite and ascertainable. Thus, you will have to compute income from house property separately for yourself and your son, in case the shares are definite and ascertainable.
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Q. Last week I saw a query on municipal tax. Can I claim this exemption if I own a house in a co-operative housing society? Can my husband and I claim the exemption? -Chandni Shailesh
A. If a property is self-occupied, it entails no tax at all. Therefore, municipal taxes can be claimed as deduction from the rental income derived from a let-out house property only.
Suraj Nangia, Partner, Nangia Advisors LLP
Source; DNA Money