Page Contents
- Article compiles 25 Important Points to be Considered before Filing of Income Tax Return for Financial Year 2017-18 / Assessment Year 2018-19.
- 1. Use Correct ITR Form
- 2. Consequences Of Not Filing Of ITR In Time
- 2a. Penalty for Not Filing of ITR in Time
- 3a. Proper Disclosure of Interest Income
- 3b.Taxability of Various Types of Interest
- 4. Clubbing of Income (Minor & Spouse)
- 5.When Filing of ITR Not Required ?
- 6. High Value Transaction ( U/S 285 BA)
- 7. Withdrawal Too Little or Investment Investing Too Much
- 8. Reversal of Deduction u/s 80C
- 9. Receiving of Gift
- 10. Declare Exempt Income
- 11. Matching of TDS in 26AS vs. ITR
- 12. Change of Employer during the year
- 13. Ensure correct TAN in ITR
- 14. Disclosure of Assets & Liabilities
- 15. TDS Not Deducted On Property worth Rs 50 Lakhs
- 16. Full Salary Detail In ITR –I From FY 2017-18
- 17. Salary Income in ITR to match with Form 16 & 26AS
- 18.Whether To Report All Bank Accounts ?
- 19.Have You not filed ITR for Last 2 Years ?
- 20. Which Address In ITR
- 21. Loosing Benefits If ITR Not Filed ?
- 22. Full Payment of Tax Before Filing
- 23. E- Verify your ITR or ITR –V
- 24.What to do if your ITR-V is Rejected
- 25. Detail of Foreign Assets & Liabilities Required
Article compiles 25 Important Points to be Considered before Filing of Income Tax Return for Financial Year 2017-18 / Assessment Year 2018-19.
1. Use Correct ITR Form
ITR 1
- For Individuals having
- Salary Income
- Pension
- Income from Other sources
- Income from House property (only One House )
- Agriculture Income less than Rs. 5000
- Total Income is up to Rs. 50 lakh
ITR 2
- For Individuals and HUF having
- Income from items in ITR 1 which is more than Rs. 50 lakh.
- Income from capital gains
- Foreign Income
- Agricultural Income more thanRs. 5000
- Income from Business or Profession under a Partnership firm
2. Consequences Of Not Filing Of ITR In Time
(Last Date to Submit ITR is 31st July)
1. Notice may be issued u/s 142(1) for non-filing of income tax return.
2. Losses if any during the year, would not be allowed to carry forward. Normally, if you file your return on time, losses of this year can be set-off against gain of forthcoming years.
3. Interest at the rate of 1% per month would be charged on outstanding amount of Tax .
4. Penalty ( Next PPT )
5. Return Filed in time or Belated ITR can be revised before the end of Relevant Assessment Year or completion of assessment which ever is earlier.
2a. Penalty for Not Filing of ITR in Time
Section 234F w.e.f. FY 2017-18 to provide mandatory late fee for default in furnishing the ITR before specified date.
Due Dates of filing return of Income for Individual :
It is 31st July of the assessment year (i.e. 31st Jul 2018 for FY 2017-18).
Resident Individual liable to pay late fees
If total income exceeds the maximum amount not chargeable to tax does not file ITR, is liable to pay late fees.
Income Exemption Limit which is not chargeable to tax
Rs 2.50 Lacs for Individual , Rs 3 Lacs Sr. Citizen , Rs 5 lacs Super Sr citizen . The above income limit is before deductions under chapter VIA (i.e. 80C to 80U)
| LATE FEES | TOTAL INCOME |
| Nil | If Total Income* is below taxable limit.
*Total Income means Gross Total Income Minus Deduction under Chapter VIA (i.e. 80 C to 80U). |
| Rs. 1,000 | If total income is below Rs. 5,00,000/- |
| Rs. 5,000 | If total income exceeds Rs.5,00,000/- and return is furnished up to 31st December 2018 (For the FY 2017-18) |
| Rs. 10,000 | If total income exceeds Rs. 500000/- and return is furnished after 31st of December 2018 (For the FY 2017-18) and non-filing of return. |
3a. Proper Disclosure of Interest Income
> Interest on SB, RD, FDR, NSC, Infrastructure Bond
> No TDS on Savings account but on time deposit (RD & FDR) it is applicable
> Deduction u/s 80 TTA Rs 10000 in respect of savings bank account available
> FDR interest in ITR necessary as TDS is only 10% but assessee may be taxable @ 30%
> Matching with 26 AS
> Submit 15G/15H in time if ITR not to be filed.
3b.Taxability of Various Types of Interest
| Sl | Nature of Interest | Taxability | Remarks |
| 1. | Bank Fixed Deposit Interest | yes | |
| 2. | Bank Saving Bank interest | Yes | Deduction u/s 80TTA available |
| 3. | Bank R.D. Interest | Yes | |
| 4. | 5 Year Tax Saver FDR | Yes | |
| 5. | PO saving Bank | Yes | Deduction u/s 80TTA available |
| 6. | PO RD A/C and FDR | Yes | |
| 6. | KVP | Yes | |
| 7. | NSC | Yes | Deduction u/s 80C available |
| 8. | PF/PPF | No | |
| 9. | Corporate FDR | Yes | |
| 10. | Foreign Gold Bond | Yes | |
| 11. | Capital Gain Bond | Yes |
4. Clubbing of Income (Minor & Spouse)
> Earning from investment in the name of minor child or spouse to be clubbed in donor income
> Minor child means less than 18 years
> A deduction of Rs 1500 per children
> No clubbing if spouse in professional capacity
5.When Filing of ITR Not Required ?
(When GTI after exemption is less below taxable limit )
| Details | Taxpayer A | Taxpayer B | Taxpayer C |
| GTI | 300000 | 400000 | 800000 |
| Less :Exemption ( HRA, LTC Conveyance ) | 20000 | 160000 | 200000 |
| Less :Deduction (80 c & 80TTA ) | 40000 | 70000 | 150000 |
| Net taxable income | 240000 | 170000 | 450000 |
| Whether filing of ITR Required ? | Yes | No | Yes |
| Tax payable | Nil | Nil | 23175 |
| Reason for Filing/non filing | Even though the taxable income is less than 250000 but before deduction exceeds 250000 | GTI after exemption is less than 250000 | Taxable Income before deduction is more than 250000 |
6. High Value Transaction ( U/S 285 BA)
| Sl. | Nature and value of transaction | Report by Whom | |
| 1. | a) Payment in cash for purchase of DD/PO/Banker’s Cheque aggregating to Rs. 10 Lakh or more
b) Cash deposits/withdrawals aggregating to Rs. 50 Lakh or more, in or from one or more current account. |
A bank/co-operative bank | |
| 2. | Cash deposits in SB aggregating to Rs. 10 lakh or more in a year | A bank/co-operative bank/ post Master General | |
| 3. | Time deposits aggregating to Rs. 10 lakh or more in a financial year( other than time deposit issued on renewal of a/c ) | A bank/co-operative bank/ post Master General/ Nidhi/ Non-banking Co. | |
| 4. | Credit Card Payment made by any person of an amount aggregating-
a) Rs. 1 Lakh or more in CASH b) Rs. 10 Lakh or more by any other mode, against bill raised in respect of one or more credit cards in a FY. |
A bank/ co-operative bank/ any other company or institution issuing credit card | |
| 5. | Bonds or debentures aggregating to Rs. 10 lakh or more in a F.Y . | A company or institution issuing bonds or debentures | |
| 6. | Shares aggregating to Rs. 10 lakh or more in a F.Y for receipt of money from a person | A company issuing shares | |
| 7. | Buy Back aggregating to Rs. 10 Lakh or more in a F.Y | A company listed on a recognised stock exchange purchasing its own securities under section 68 | |
| 8. | Mutual Fund aggregating to Rs. 10 lakh or more in a F.Y | A trustee of a Mutual Fund or such other person managing the affairs of the Mutual Fund | |
| 9. | Foreign Currency aggregating to Rs. 10 Lakh or more in a F.Y for sale of foreign currency | Authorised person under FEMA | |
| 10. | Purchase or sale of immovable property of Rs. 30 Lakh or more. | Registrar or Sub-Registrar/ Inspector- General | |
| 11. | Goods & Services exceeding Rs. 2 lakh
Receipt of cash exceeding Rs 2 lacs for sale of goods and services |
Any person who is liable for audit under section 44AB | |
7. Withdrawal Too Little or Investment Investing Too Much
- If no withdrawal or little from the salary a/c suspicion may arise
- Investment too much compared to income
8. Reversal of Deduction u/s 80C
> LIC surrendered before 2 years
> ULIP surrendered before 5 years
> PF encashment before 5 years on change of job
> Deduction claimed u/s 80C for Repayment of Housing Loan and selling of house before 5 years
9. Receiving of Gift
> Gift from non relative exceeding Rs. 50,000 taxable
> Gift from relative not taxable
> Gift on certain occasion not taxable
> Clubbing provision on gifting to be checked
> Donor may come under scrutiny if receiver under scrutiny
10. Declare Exempt Income
> Capital gain from shares, mutual funds
> Dividend Income
> Maturity of LIC
11. Matching of TDS in 26AS vs. ITR
> TDS in ITR should match with 26AS
> TDS on FDR normally comes through 26AS
12. Change of Employer during the year
- To disclose income received from previous Employer
- To disclose exemption claimed from the previous employer
13. Ensure correct TAN in ITR
14. Disclosure of Assets & Liabilities
( If Total Income Exceeds Rs. 50 Lacs)
15. TDS Not Deducted On Property worth Rs 50 Lakhs
- Buying immovable property of Rs 50 lacs or more
- Deduct 1% TDS from the payment to the seller.
- TDS to be deposited with Govt. using Form 26QB.
16. Full Salary Detail In ITR –I From FY 2017-18
(Earlier the detail was to be filled in ITR 2 only )
17. Salary Income in ITR to match with Form 16 & 26AS
| Form 16 | Amount | Amount |
| Salary as per section 17 (1) | 30,57,579 | |
| Add : Value of Perks as per 17 (2) detailed in 12 BA | 16756 | |
| Total salary | 30,74,536 | |
| Less : Allowances exempt u/s 10 | 21900 | |
| Conveyance 19200 + Institute Fees 2700 | ||
| Income chargeable under the head salary | 30,52,637 | |
| ITR-2 | Amount | Amount |
| Salary excluding exempt allowances | 30,35,880 | |
| Value of Perks ( after adjusting 21900) | 16756 | |
| Income chargeable under the head salary | 30,52,637 | |
| 26 AS | Amount Paid/ Credited | TDS deducted & deposited |
| 30,74,536 | 7,24,237 | |
| Note : Here salary income as per ITR and 26AS not matching | ||
18.Whether To Report All Bank Accounts ?
> All operative accounts are to be reported
> Dormant accounts not to be reported
> Dorman A/c i.e. non operative for 36 M
> Dormant if no transaction initiated
> Transaction : Withdrawal of cash ,cheque payment, Transfer of funds etc.
19.Have You not filed ITR for Last 2 Years ?
- FY 2015-16
- FY 2016-17
For both the year as above ,last date to file the ITR was 31.03.2018 . Now the time limit is exhausted.
20. Which Address In ITR
> May be 3 to 4 addresses quoted at various places.
> Addresses in Voter’s ID, bank account, Aadhaar card and PAN records may not match
> It is advisable to give address of the place where you currently reside.
21. Loosing Benefits If ITR Not Filed ?
> For availing loan facility like home, or personal.
> For visa and immigration processing
> For income proof/ Net worth certificate
> For claiming excess tax paid via refund
> Applying for a higher insurance cover
> Last and most important is your peace of mind
22. Full Payment of Tax Before Filing
- Tax Challan 280
- Payment of self assessment
23. E- Verify your ITR or ITR –V
- Post ITR-V physical copy to CPC Bangalore within 120 days
- Else E –verify through different mode
- E- verify through linking your Aadhaar with your PAN on the e-filing website
- E- verify through Net banking in the bank site
- E- verify through Income tax e- filing portal with e-file menu option
- E filing through Demat a/c
24.What to do if your ITR-V is Rejected
> ITR filed but status showing as “ITR-V Rejected”.
> Know reason of rejection on clicking of acknowledgement No
> If reason is “Filing date has exceeded the due date”, means ITR-V is not reached to CPC-Bangalore within 120 days of e-Filing.
> What do I do now? File a revised return and send the revised ITR-V to CPC Bangalore.
> Other reasons for the ITR-V rejection either signature is missing or the ITR-V document is of “poor quality”.
> If the 120 days not elapsed, simply print a fresh copy of ITRV, sign to CPC within 120 days
25. Detail of Foreign Assets & Liabilities Required
Kept at any time during the financial year
- Details of foreign bank accounts
- Details of Financial interest in any Entity
- Detail of Immovable Property
- Details of any capital assets
- Details of bank A/c for which you are a signatory
- Detail of income derived from any source o/s India
Would like to know the applicability of interest received from Monthly income scheme from Post Office Under Sl.No. 3a & 3b..
Also, do we need to declare the interest credited on Provident Fund Account / Public provident fund account under exempted income ?