The income earned by the individuals and businesses are subject to tax. The tax levied on the income of a person is Income tax, which is levied and collected by the Central Government. Such tax on income earned is payable in the same financial year wherein it is accrued in the form of advance tax. But the intimation and calculation of the income as well the tax liability is provided in the Assessment Year. This intimation form is called Income Tax Return. The form and time limit for filing ITR are different for different taxpayers based on the criteria
☢ CLAIM REFUND OF TDS PAID FROM SALARY
Salaried personnel receives the income after deduction of applicable TDS. It may happen that after the eligible deductions, the tax liability is lower than the amount of TDS actually deducted. In such cases, the excessive payment can be claimed in the form of refund only if ITR is filed by the person.
☢ ALLOWS CARRY FORWARD OF LOSSES
Most businesses in their initial years face losses from the business. The business loss or capital losses can be carried forward up to 8 years if the ITR is filed. This loss can also be adjusted against the future income that lowers taxable income in the future. If ITR is not filed, the taxpayer is deprived of this benefit.
☢ DEFINE FINANCIAL WORTH
The ITR filed with the Government defines the financial worth of the taxpayer. The track of ITR shows the financial capacity and also increases the capital base of a person. Hence, the track of income and financial worth is decided by the previously filed ITR. The investors and institutions look forward for returns filed to know the capacity of the business.
☢ LOAN PROCESSING AND HIGH RISK COVER
Higher the financial worth, easier the loan processing. The same applies to high-risk cover insurance. The ITR is a considerable document for making decisions in this regards.
Online TDS return is a statement given to the IT department every quarter. It is essential for every deductor to deposit income tax and file for TDS return on time.
An employer or company that has valid TAN – Tax Collection and Deduction Account Number can file for online TDS return. Any individual or business who makes a particular payment which is stated under the I-T Act needs to deduct tax at source. The deposit for the same has to be made within the stipulated time.
An assessee can submit an e-TDS return if the same was deducted from their income. As mentioned earlier, it is the obligation of the assessee to file within the due date or be liable to pay a penalty for delay. The categories of assessees eligible to electronically file TDS return every quarter are:
2) Persons whose accounts are audited u/s44AB
3) Persons holding an office under the Government
Obtain PAN Number for permanent identity through online application
PAN or Permanent Account Number is a 10 digit alpha-numeric identity issued by the Income Tax Department of India. It is a unique account number allocated by the Income Tax Department, which is used to track and manage all the Income Tax assessee in India.
Although the PAN card application is voluntary, it must be obtained before engaging in certain transactions. For entering into a financial transaction exceeding a specified amount, quoting PAN is compulsory. Also, every business entity must apply for PAN card application within the 30 days of its formation or incorporation.