05 Apr
Who Should File an Income Tax Return? Understanding the Categories of Taxpayers
"Who Should File an
Income Tax Return? Understanding the Categories of Taxpayers"
Income tax
is a type of tax levied by the government on the income of individuals and
companies. The income tax return is a form filed with the tax authorities
providing details of an individual or a company's income, deductions, and taxes
paid in a financial year. In India, the Income Tax Act, of 1961, mandates the
filing of an income tax return by certain categories of taxpayers.
Let us
discuss in detail the categories of taxpayers who are required to file an
income tax return.
1.
Companies:
Every
company, be it a Private Limited, LLP or partnership, irrespective of the income
or loss, must file IT returns. The company’s income tax return must be filed
within the due date mentioned in the Income Tax Act.
2.
Individuals with
Multiple Jobs:
People who
have opted for one job from another are also eligible to file an income tax
return. If an individual has two or more jobs, he/she must file an income tax
return for each of them. If an individual has changed jobs in the financial
year, he/she must also file an income tax return.
3.
Individuals or
Companies Claiming Tax Refunds:
Individuals
or companies who want to claim tax refunds must file an income tax return. A
tax refund is a return of excess tax paid by the taxpayer to the government. If
the tax paid is more than the actual tax liability, the excess amount is
refunded to the taxpayer.
4.
Salaried Individuals:
Salaried
persons whose gross income before deductions under sections 80C to 80U exceeds
the exemption limit must file an income tax return. The exemption limit is the
income limit below which an individual is not required to pay income tax. For
the financial year 2022-23, the exemption limit for individuals below 60 years
of age is Rs. 2.5 lakh, and for senior citizens, it is Rs. 3 lahks.
5.
Individuals with
Foreign Income, Foreign Assets, NRIs, and Tech Professionals on Onsite
Deputation:
All
individuals with foreign income, foreign assets, Non-Resident Indians (NRIs),
and tech professionals on onsite deputation are required to file an income tax
return in India. NRIs are taxed only on the income earned or received in India.
Tech professionals on onsite deputation are required to file an income tax
return in India if they have earned any income in India.
In
conclusion, filing an income tax return is mandatory for certain categories of
taxpayers as per the Income Tax Act, of 1961. It is advisable to file an income
tax return even if it is not mandatory as it helps in financial planning and
building a good credit score. It is important to file the income tax return
within the due date to avoid penalties and interest.
Regards
Santosh
Patil
Founder
Alliance
Tax Experts Pvt Ltd
9769201316
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