ITR Filing MYTHS & Misconceptions

Now a days Income Tax Return (ITR) filing is very important and necessary for every assessee in the rapidly changing economic scenario. But I have come across the fact that with the increasing needs of filing ITR , “THE MYTHS ABOUT FILING ITR ARE ALSO INCREASING DAY BY DAY”.

These Myths include Myths Like  I Am Making Very Less Profits Or I Am Making Losses, So I Don’t Need To File ITR, E-Filing Is Not Safe,  My Refund Is Delayed By My Lawyer/Chartered Accountant (CA),  I Have Paid My Taxes And No Refund Is Due To Me, Form 16 Itself Is An ITR, I Cannot File ITR Apart From My Usual Place Of Residence, and the myth that If I Don’t File Return I Am Safe.

So here are some of my efforts that definitely will help you to overcome these MYTHS about ITR filing as per Income Tax Act, 1961.

Myth 1: I Am Making Very Less Profits Or I Am Making Losses, So I Don’t Need To File ITR

• The Income Tax Act, 1961 requires every assessee to file ITR if the Total Income exceeds the maximum amount prescribed by the Law, which is not chargeable to Income Tax.
• The law does not prohibit the assessee from filing the ITR if Total Income is below the exemption limit.

Myth 2: E-Filing Is Not Safe

• E-filing is much safer that manual filing, as the ITR filed by you is directly going to Income Tax department and no manual Interruptions are involved.
• Just you have to check the Trustworthiness of the website you choose to prepare and file Your ITR. It is my suggestion that the best way is to file from Government Site i.e.www.incometaxindiaefiling.gov.in

Myth 3: My Refund Is Delayed By My Lawyer/Chartered Accountant (CA)

• If you file your return early, it will be processed early. EARLY FILING, EARLY PROCESSING
• Lawyers/CA are only the medium or mediaters to help you to file ITR, they are not the Authority to keep your ITR.

Myth 4: I Have Paid My Taxes And No Refund Is Due To Me

• ITR filing is mandatory if you have paid any taxes. It is a misconception that “I have paid my taxes and No refund is due to me, hence ITR filing is not mandatory for me.”

Myth 5: Form 16 Itself Is An ITR:

• Some people think that Form 16 given by the Employer itself is and ITR and ITR has been already filed as employer has given us Form 16.
• Just to clarify that Form 16 is the form compulsorily given by every employer to its employees regarding salary paid to him/her by the employer and other Income and Investments of Employee done during the Financial year if such are declared by employee to the Employer, and Tax Deducted at source of the Employee by the Employer.
• Hence ITR is different from Form 16.

Myth 6: I Cannot File ITR Apart From My Usual Place Of Residence:

• ITR is a PAN based return and not Resident based return.
• Due to e-filing and before that also the asessee can file ITR from anywhere in India.

 Myth 7:If I Don’t File Return I Am Safe:

• This is a very big Myth. You are not at all safe.
• If you want VISA , Loan from a Bank ITR is compulsorily required.
• Also if you are liable to file ITR and you do not file it , then it will attract Interest, penalty and prosecution.

In Addition to this I am providing you the list where ITR filing is Mandatory in India:-

1. If the Gross Total Income (GTI) exceeds taxable limit prescribed by the Law, ITR filing is Mandatory.

2. If you are a Company or a Firm irrespective of whether you have profits or loss during the Financial Year.

3. If you want to claim Income Tax refund.

4. If you want to carry forward a loss under a head of Income.

5. If you are a Resident and have an asset or Financial Interest in an entity located outside India.

6. If you are a Resident and a signing authority in Foreign Account.

7. If you are in receipt of Income derived from property held under a Trust for Charitable or Religious purpose, Political Party, Educational Institute, News Agency etc.

8. If you are a Foreign Company taking treaty benefit on transactions in India.

9. If you have sold or purchased any property, during the Financial Year.

10. For every Non Resident Indian (NRI) Income earned or accrued in India is Taxable in India.

CONCLUSION:

STAY AWAY FROM MYTHS/MISCONCEPTIONS AND FILE YOU ITR AND PAY TAXES WITHIN DUE DATES PRESCRIBED UNDER THA ACT AS APPLICABLE FROM TIME TO TIME.

DON’T ATTRACT SLEEPLESS NIGHTS BY GETTING INTO MYTHS.

CONSULT YOUR EXPERT ALWAYS BEFORE FILING ITR, THOUGH YOU KNOW HOW TO FILE IT.

Now I hope after this small Article I am successful to make a Layman to understand and Overcome the Myths about filing ITR. I hope I am able to make some Value addition in all of your knowledge and you have enjoyed the reading.

I will be back again with some more Interesting Articles related to Direct and Indirect Taxes.

Name: CA Manasi Amit Bhalerao

Address: Nagpur

Email: [email protected]