Income Tax – Income Tax Slab, Income Tax Calculator, Income Tax Returns, Due Dates, E-filing process F.Y. 2020-2021
The present article enables the common man to understand the basics of Income Tax; Income Tax Return; Due dates for filing ITR for Financial Year 2020-2021; E-filing process and some of the relevant important FAQs.
What is the meaning of income tax?
Grossly speaking, taxes are of two types, namely, ‘Direct Tax’ and ‘Indirect Tax’. Taxes that are directly levied on the income is known as ‘Direct Tax’ For eg. ‘Income Tax’.
Talking further about income tax, the income earned is divided into the following ‘Heads of Income’-
1. Income from Salary,
2. Income from House Property,
3. Income from Business and Profession,
4. Income from Capital Gain, and
5. Income from Other Sources.
How is income tax calculated?
The Income Tax is calculated based on the ‘income tax slab rates’ as applicable during the respective Financial Year. Income tax slab rates (both old and new tax regime) as applicable for the Financial Year 2020-2021 (i.e., the Assessment Year 2021-2022) is briefed hereunder-
OLD TAX REGIME-
Tax slab for individuals-
| Individual (resident or non-resident) | Resident senior citizen
(i.e., age group 60 years or more but less than 80 years) |
Resident super senior citizen
(i.e., age group above 80 years) |
|||
| Net Income | Tax Rates | Net Income | Tax Rates | Net Income | Tax Rates |
| Up to INR 2,50,000 | NIL | Up to INR 3,00,000 | NIL | Up to INR 5,00,000 | Nil |
| INR 2,50,001 – INR 5,00,000 | 5% | INR 3,00,001 – INR 5,00,000 | 5% | INR 5,00,001 – INR 10,00,000 | 20% |
| INR 5,00,001 – INR 10,00,000 | 20% | INR 5,00,001 – INR 10,00,000 | 20% | Above INR 10,00,000 | 30% |
| Above INR 10,00,000 | 30% | Above INR 10,00,000 | 30% | – | – |
Tax slab for HUF, AOP and BOI or any other artificial juridical person-
| Net Income | Tax Rates |
| Up to INR 2,50,000 | NIL |
| INR 2,50,001 – INR 5,00,000 | 5% |
| INR 5,00,001 – INR 10,00,000 | 20% |
| Above INR 10,00,000 | 30% |
NEW TAX REGIME-
Tax slab for individual and HUF-
| Total Income | Tax Rates |
| Up to INR 2,50,000 | NIL |
| INR 2,50,001 – INR 5,00,000 | 5% |
| INR 5,00,001 – INR 7,50,000 | 10% |
| INR 7,50,001 – INR 10,00,000 | 15% |
| INR 10,00,001 – INR 12,50,000 | 20% |
| INR 12,50,001 – INR 15,00,000 | 25% |
| Above INR 15,00,000 | 30% |
OTHER INCOME TAX SLABS-
- Partnership firm (including LLP) and the local authorityare taxed at the rate of 30%.
- Domestic company-
| Normal Rate | Special Rate | ||
| Particulars | Tax Rates | Particulars | Tax Rates |
| Turnover or gross receipts up to INR 400 Crores in the Financial Year 2019-2020 | 25% | As per section 115BA | 25% |
| Others | 30% | As per section 115BAA | 22% |
| – | – | As per section 115BAB | 15% |
- Co-operative society-
| Income | Tax Rates |
| Up to INR 10,000 | 10% |
| INR 10,001 – INR 20,000 | 20% |
| Above INR 20,000 | 30% |
It is important to note that ‘Surcharge’ and ‘Health and Education Cess’ is applicable over and above the tax rates mentioned above.
What are the Income Tax Returns (ITRs) in India?
Income Tax Returns-
Basically, income tax returns (IT returns) is a form through which the annual income of the taxpayer is reported. Based on the income assessment group, the taxpayer will have to submit one of the following ITR forms-
| ITR forms | Applicable to |
| ITR 1 | Resident individual-
|
| ITR 2 | Individual and HUFs not having any income from profits and gains of business or profession |
| ITR 3 | Individual and HUFs having income from profits and gains of business or profession |
| ITR 4 | Resident individual, HUFs and Firms (not LLP)-
|
| ITR 5 | Any person other than-
|
| ITR 6 | Companies (other than companies claiming exemption under section 11) |
| ITR 7 | Any person (including company) who are required to furnish return under section 139(4A); or section 139(4B); or section 139(4C); or section 139(4D). |
What is the last date for filing ITR for AY 2021-22?
As per the latest issued circular no. 17/2021 dated 9th September 2021, the due dates for filing the ITR for the Financial Year 2020-2021 is extended. Original due date and extended due dates are tabulated hereunder-
| Particulars | Original due date | Extended due date |
| ITR filing by the taxpayers not covered under tax audit | 31st July 2021 | 31st December 2021 |
| ITR filing by the taxpayers covered under tax audit | 31st October 2021 | 15th February 2022 |
| ITR filing by the taxpayers required to furnish report referred in section 92E | 30th November 2021 | 28th February 2022 |
E-filing process F.Y. 2020-2021-
Recently, on 7th June 2021, the Central Board of Direct Taxes launched the new e-filing portal www.incometax.gov.in.Despite many initial technical challenges, the new portal has certainly tried to make the ITR filing much easier.
ITR filing is possible in both online and offline modes. The basic steps to be followed for filing the ITR is summarized hereunder-
STEP 1 – Visit site https://www.incometax.gov.in/iec/foportal.
STEP 2 – Click the ‘Login’ icon available on the right-hand side.
STEP 3 – Enter ‘User ID’ and click Continue.
STEP 4 – Enter ‘Password’ and click Continue.
STEP 5 – Click ‘File Now’.
STEP 6 – Select Assessment Year 2021-2022 from the drop-down list.
STEP 7 – Select the mode of filing i.e. Online or Offline.
STEP 8 – Click Continue.
STEP 9 – Based on the mode of filing selected, fill up the required details and submit the return.
FAQ-
Q.1 What is the e-filing of income tax return?
E-filing of income tax return is a process through which the taxpayer has to submit their income tax return ‘online’.
Q.2 How do I Efile my tax return?
Post ‘Login’ into the e-filing portal www.incometax.gov.in one can e-file the return using either online mode or offline mode.
Q.3 What is the e-verification of income tax return?
E-verification is a process that helps to verify the identity of the return filers. It is mandatory to e-verify the ITR within 120 days of its filing. In case of failure, the return will be treated as null and void.
Q.4 What is form 16 in Income Tax?
Form 16 is a certificate issued by the employer to salaried individual acknowledging that the TDS deducted is deposited with the Income Tax Department.
Q.5 How is tax calculated on salary?
Tax is calculated on salary on the basis of the tax slab rates as applicable to the individual.
Q.6 How can I reduce my taxable income?
Some basic steps to reduce the taxable income are-
- Use entire limit of INR 1.50 Lakhs available under section 80C.
- Contribute to the National Pension Scheme.
- Avail health insurance premium deduction.
- Claim deduction on rent paid and interest on home loan taken.
- Keep some money in saving bank account and avail interest deduction up to INR 10,000 under section 80TTA.
Q.7 What income is tax free?
Income which are exempt from the scope of Income Tax are tax free incomes. Agricultural income, gratuity, provident fund income, amount received from insurance, gifts, etc. are some of the examples of tax free income.
Q.8 What is taxable limit?
Any income above the exemption limit is taxable limit under income tax.
Q.9 What is the exemption limit for very senior citizen age above 80?
Exemption limit for very senior citizen having age above 80 years for the Financial Year 2020-2021 is INR 5 Lakhs.
Q.10 What are deductions for senior citizens AY 2020-21?
Following deductions are available to senior citizens-
- Deduction under section 80TTB up to INR 50,000 on interest earned on deposits,
- Higher deduction under section 80D up to INR 50,000 for payment of medical insurance premium.
- Higher deduction under section 80DDB up to INR 1 Lakhs for ailment of specific disease.
Q.11 At what age do seniors stop paying taxes?
Seniors above the age of 60 years having income below exemption limit i.e. INR 3 Lakhs are not required to pay any income tax.
Q.12 What is income tax slab for ladies 2021-2022?
Earlier the basic exemption limit of male and female were different. However, now common tax slab is applicable to both. Accordingly, income tax slab for ladies for 2021-2022 is also same as tabulated in article above.
Q.13 How can women save tax?
Some of the tax saving ways are-
- Repaying home loan,
- Education loan,
- Investing in health insurance,
- Contributions to charity and relief funds.
Q.14 What is the maximum limit of Section 80C for female?
Maximum limit available to female under section 80C is INR 1.50 Lakhs.
Q.15 Can I save tax by investing in shares?
Yes, if planned properly, one can save tax by investing in equity shares.
Q.16 What are the best tax saving investment?
Some of the best tax saving investments are-
- Public Provident Fund,
- Sukanya Samriddhi Yojana,
- Unit Linked Insurance Plan,
- National Savings Certificate,
- National Pension System,
- Senior Citizen Saving Scheme, etc.
Author Bio
Hello sir, This is Sai Eshwar from hyderabad. i was Studying degree 2nd year, i was started a small bussiness. i want to file income tax return. but if i file itr is this effect to scholarship?
Dear Sir,
I am a Joint Account Holder ( secondary account holder ) , when I am trying to VALIDATE my Bank Account in INCOME TAX INDIA E-FILING PORTAL with correct A/C No. and correct IFSC Code but the ERROR is coming PAN-Bank Account-IFSC Linkage FAILED.
I have contacted my Bank Branch and they have confirmed that my Bank Account is linked with my PAN.
My TDS is also reflecting in 26AS Form and I am getting Form 16A from my Bank Branch.
If I will not be able to VALIDATE this Bank A/C in INCOME TAX INDIA E-FILING PORTAL, can I submit ITR1 without this Bank A/C Number.
Please advise or please advise how to solve this Problem.
Thanks and regards.
Dear Sir,
I am a Joint Account Holder ( secondary account holder ) , when I am trying to VALIDATE my Bank Account in INCOME TAX INDIA E-FILING PORTAL with correct A/C No. and correct IFSC Code but the ERROR is coming PAN-Bank Account-IFSC Linkage FAILED.
I have contacted my Bank Branch and they have confirmed that my Bank Account is linked with my PAN.
My TDS is also reflecting in 26AS Form and I am getting Form 16A from my Bank Branch.
If I will not be able to VALIDATE this Bank A/C in INCOME TAX INDIA E-FILING PORTAL, can I submit my ITR1 without this Bank A/C Number.
Please advise or please advise how to solve this Problem.
Thanks and regards.
My ITR communication address corrected Ref. No; Contact detail is updated successfully and the Transaction ID is FOS000294977001. How can add communication@cpc.incometax.gov.in
Can you clarify whether dividend income is taxable or not ?
Please discuss about form 26AS and about furnishing income as set out in the return ,Declaring the Demat account particulars and calculating. Capital gains