Why Income Tax Return Filing is Mandatory? All You Need to Know

Paying Tax in time and participate in the nation-building is both a legal and moral duty of a citizen. It is important to note that Income Tax Return must be filed even if there are no tax dues to the taxpayers in the earlier period.

As per the income tax laws, everyone shall file income tax returns within the prescribed time when their total income (before allowing deductions under section 80C to 80U) exceeds Rs 250,000 in a particular financial year.

This year, July 31^st is the last date for filing your income tax return.

The following persons are required to file income tax return mandatorily,

1. All Companies, Partnership Firms, LLPs Trusts, Associations, Political Parties (whose income prior to claim of exemptions exceeds the minimum chargeable to tax)
2. Individuals and HUFs having income more than Rs. 2.5 lakhs (For Senior Citizens, Rs. 3 Lakhs(Age 60 Years up to 80 Years) and Rs. 5 Lakh (Age 80 Years or More))

Persons who miss the deadline can file a belated return. From this year onwards, a hefty late fee is payable for filing belated returns.

A late fee of Rs. 5,000/- is payable if you misses the deadline and filed IT return on or before 31^st December 2018. For returns filed after 31^st December, the late fee applicable would be Rs. 10,000.

For persons having annual income of Rs. 5,00,000 in a year, the late fee payable is Rs. 1,000 irrespective of when you file the return. The facility to submit a belated return of the Financial Year 2017-18 will not be opened after 31^st March 2019.

Filing returns on time will safeguard you from penalties, interest and other penal actions and also allow you to revise, re-file the original return without any fee. However, belated returns cannot be revised once it is filed. However, revisions for returns pertaining to Financial Year 2017-18 (Assessment Year 2018-19) cannot be made after March 31, 2019.

This April, the Central Government has notified Income Tax Return Forms (ITR Forms) for the Assessment Year 2018-19. For Assessment Year 2017-18, a one page simplified ITR Form-1(Sahaj) was notified. This initiative benefited around 3 crore taxpayers, who have filed their return in this simplified Form.

For persons who select a wrong ITR Form for filing his income tax return, there are high chances to get a notice from the tax department as he will disclose incomplete information in ITR or report inaccurate details. Similarly, non-reporting of all income in the ITRs would also invite same consequences. It is very important to disclose every petty income such as interest from bank/ any party or any profit or gain from share transactions. You cannot escape from the liabilities by omitting these transactions because the tax department receives information from the banks about all your financial transactions on a regular basis.

It is significant to reconcile your Form 26AS before filing the return. The Form reflects the details of tax deducted from source from your income and the payment of advance tax made or any refund you received in this year. Any discrepancy in the Form must be rectified before filing of return otherwise, credit of TDS claimed in the return will be denied by the department.

It is also important to remember that the salaried class can claim for eligible deductions even if these were not considered by the employer while deducting TDS. The employees can claim all eligible deductions despite the fact that those deductions are not reflecting in Form 16.