Income Tax: Rates, Due Date and Return Filing in India

Author
By Nireka Dalwadi on May 21, 2019

Income Tax is a type of direct tax that you pay on income earned during the financial year. In India, a direct tax is governed as per Income Tax Act, 1961 along with Income Tax Rules, 1962

Income Tax is levied based on the different type of incomes and taxpayers.

Index

Who should file ITR?

A taxpayer is required to file ITR if their income is more than the basic exemption limit. The basic exemption limit for Individuals and HUFs below the age of 60 years is INR 2.5 Lakh in AY 2019-20.

However, a taxpayer with income less than the basic exemption limit can also file an ITR. This is known as a NIL return.

ITR for NIL Income View Plan

When is ITR filing mandatory?

For certain income situations, it is mandatory to file ITR irrespective of the income.

  • Resident to whom any of the following situations is applicable needs to file ITR:
    • Who has an asset outside India,
    • Who has a financial interest in any entity located outside India,
    • Earned income from a source outside India during the year,
    • Who has signature authority in any bank account located outside India.
  • Any taxpayer who wishes to claim a refund of excess TDS deducted needs to file ITR.
  • Any taxpayer who has incurred the losses during the financial years and wishes to carry it forward to the next financial year needs to file the return.
  • All Companies, Partnership Firms, LLPs, Local Authorities are required to file ITR.

Who is considered as Resident?

The taxability of a person depends on their residential status. The residential status is different from the citizenship of a person. Types of Residential Status for Income Tax purpose in India are:

  • Ordinary Resident of India
  • Resident but Not Ordinary Resident of India (RNOR)
  • Non-Resident of India (NRI)

A taxpayer is a resident in India if they stayed in India for:

  • 182 days in a financial year, or
  • 60 days in a financial year and 365 days or more in the past 4 financial years
Check your Residential Status
Know your Residential Status from: Resident, Ordinary Resident or NRI

What are the Due Dates to file ITR?

Category Due Date
Individuals to whom audit is not applicable 31st July of the Assessment Year
Companies 30th September of the Assessment Year
Individuals to whom audit is applicable 30th September of the Assessment Year
Individuals/ HUF who are partners in a firm and firm’s accounts are subject to audit 30th September of the Assessment Year
What is the difference between Assessment Year and Financial Year?

What are the Documents required to file ITR?

The basic documents required to file ITR are:

  • PAN (Permanent Account Number)   
  • Aadhar Number
  • Form 26AS
  • Bank Account Details
  • Challan of any advance tax or self-assessment tax (if paid during the year)
  • Details of the original return (if filing a revised return)

However, documents required to submit ITR may differ based on the income situations and ITR form the taxpayer has to file.

ITR Forms, TDS Certificate, Tax Credit Statement and Filing

Which ITR Form to File?

The ITR form a taxpayer should file differs based on their income source and residential status.
The Income Tax Department has prescribed 7 different ITR forms for different income situations. The taxpayer is required to choose the ITR Form is applicable to them for that particular assessment year.
The most common ITR form filed by individual taxpayers is ITR 1 or ITR 4.

ITR-1 (SAHAJ) The most basic ITR form for individuals having income up to Rs. 50,00,000 from salary/pension, one house property and interest.
ITR-2 For individuals/HUF having income from salary/pension, multiple house property, capital gains, interest and partner’s income from the partnership firm.
ITR-3 For individuals/HUF having income from salary/pension, multiple house property, capital gains, interest and income from proprietary business or profession.
ITR-4 For individuals/HUF/Partnership firms having income from presumptive business or profession.
Know your ITR Form
Find out which ITR Form you should file

What are the Income Tax Rates for AY 2019-20?

Income is taxed based on the category of a taxpayer. In India, income tax rates are declared every year in Union Budget by the finance minister. The Income Tax Slab Rates for Individuals and HUFs below the age of 60 years are:

Taxable Income Tax Rate
Up to INR 2,50,000 Nil
INR 2,50,000 to INR 5,00,000 5%
INR 5,00,000 to INR 10,00,000 20%
Above INR 10,00,000 30%
  • Rebate u/s 87A of INR 2,500 or 100% of the tax (whichever is lower) is available to Individuals with income is less than Rs. 3,50,000
  • A surcharge is applicable if your taxable income is:
    • between INR 50,00,000 to 1,00,00,000 : Surcharge 10%
    • above INR 1,00,00,000 : Surcharge 15%
  • Health & Education Cess is 4% on the total of income tax + surcharge
Tax Savings & Deductions

How to file ITR?

You can file Income Tax Return using:

e-File ITR using Income Tax e-Filing Website

To e-file your ITR by using income tax e-filing website, you should use your income tax e-filing account.

  • Login to e-Filing portal by entering the user ID (PAN), Password, Captcha code and click ‘Login’.
  • Navigate to e-file > Income Tax Return
  • Select ITR Form, Assessment Year and other details
  • Prepare your ITR
  • Pay Self-Assessment Tax if you have outstanding tax dues. Or claim Tax Refund if you have paid excess tax during the financial year.
  • Click on ‘Submit’ to e-File your ITR.

e-File ITR using Income Tax Utilities

Income Tax Department provides Java and Excel utilities to prepare and e-file your income tax returns. These utilities allow the taxpayer to prepare their ITR offline, and using the income tax e-filing account the taxpayer can submit their ITR.

  • Go to incometaxindiaefiling.gov.in click on Offline Utilities under Download section. Now go to Income Tax Return Preparation Utilities and select the assessment year
  • Select the ITR Form you are required to file and Download ITR Utility for that ITR Form.
  • Extract the files from a zip folder: You need to have java runtime environment to unzip the utility
  • Prepare your ITR offline
  • Upload the utility on your Income Tax e-filing account.
Check ITR Status
Check your Income Tax Return filing status online

What is ITR e-Verification?

ITR filing process is not complete until you e-Verify your return. When a taxpayer files the ITR, they receive ITR V on their registered email id from the income tax department. ITR-V means Income Tax Return Verification Form, it is also known as ITR-V (Acknowledgement). 

You can e-verify your ITR by the following methods:

ITR e-Verification View Plan