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Everything you need to know about Income Tax returns

What is ITR?

An Income Tax Return (ITR) refers to the form used by taxpayers to file records about their various sources of income. The form states their gross income for the financial year as well as the tax applicable to such income. There are different variants of the ITR forms - ITR 1, ITR 2 and so on, up to ITR 7. The ITR form to be selected depends on the category of taxpayer you belong. ITR 1, for example, is meant for Individuals having Income from salaries, one house property, and having a total income of up to ₹50 lakh.

These Income Tax Returns have to be filed on or before the deadline, which is usually the 31st of July. A penalty is applicable if you do not file the ITR by this due date. The amount of such a penalty differs on the basis of income and the magnitude of delay.

Who is required to file an ITR?

If your total gross income exceeds the limit of taxable income for a particular financial year, you are legally required to file an ITR. This means that as an individual, you are to file Income Tax Returns if your annual income exceeds ₹2.5 lakhs. If you are classified as a senior citizen, that is if you are between 60 and 80 years of age, the threshold is ₹3 lakhs and if you are a super senior citizen, that is aged above 80 years, the limit is ₹5 lakhs.

If your income doesn’t touch the respective threshold, it is not mandatory for you to file your income tax returns. However, even so, it is advisable to file a ‘Nil Return’ to maintain a record.Why? It serves the simple purpose of record keeping. ITR forms are also often considered proof of salary or employment, so it is always favourable if you file your ITRs.

What are income tax slabs?

Under our progressive taxation system for income tax, tax slabs are announced each year by the Finance Minister as a part of the Union Budget. The tax slabs are basically different groups that taxpayers are categorised into based on their annual income. Different rates of taxation are applied to different income groups.

How to file an ITR

You can file your ITR online on the website: incometaxindiaefiling.gov.in. Once you are registered as a user, you will find that a lot of information (like salary details, bank details)is pre-filled. You need to update these details as necessary and file for deductions and exemptions.

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