Income Tax

The deadline to file your income tax returns, there’s no need to panic. You still have the option to file your tax returns after the due date, although with a penalty. This article provides a comprehensive guide on understanding and filing belated returns, ensuring you navigate the process smoothly while avoiding potential financial penalties.  What is Belated Return? A belated return is a return filed after the deadline i.e. 31st July of the assessment year but before 31st December of the assessment year. While late filing has consequences, it’s still better than facing potential penalties for non-compliance. The due date to file income tax return for the Financial Year 2023-24 is 31st July 2024. If you miss filing your ITR within the original deadline, then you can file a late return, known as Belated Return. Filing ITR for Previous Year Missed filing ITR for previous year within due date, you can file a belated return on or before 31st December of the relevant assessment year. For Example, for the AY 2024-25, the timeline to file a belated return is on or before 31 December 2024.In case you miss the belated return deadline, then you may file ITR-U in certain specified cases.The amendment vide Finance Act 2021 reduced the timeline of filing the belated return. With effect from AY 2021-22, you can file the belated return three months before the end of the relevant assessment year or before the completion of the assessment, whichever is earlier. What is an ITR-U or Updated ITR? ITR-U is a form that allows taxpayers to correct errors or omissions on their ITRs up to two years from the end of the relevant assessment year to update their return. In the Union Budget 2022, the government introduced the ITR U form for updating income tax returns. ITR U form is a rescue for those who have not filed their ITR or made inaccurate and false entries while filing their income tax returns. Section 139(8A) under the Income Tax Act allows you a chance to update your ITR within two years, i.e., 24 months from the end of the relevant assessment year. These two years are calculated from the end of the year in which the original ITR was filed. For instance, for AY 2023-24, you can file an ITR-U after the end of the assessment year, i.e., 31 March 2024, but within two years from there, i.e., 31 March 2026. File ITR-U. Regardless of whether the taxpayer has filed an original, belated, or revised ITR or has completely missed filing the ITR in a specific financial year, he/she can file an ITR-U upto 2 years of the relevant assessment year. Drawbacks of Filing Late Return The following are the disadvantages of filing a belated return: Interest may be applicable under sections 234A, 234B and 234C. A late fee will be levied under Section 234F while filing a belated return:  Gross total income Late fee up to Rs. 2.5 lakh No Penalty Rs. 2.5 lakh – Rs. 5 lakh Rs 1,000 more than Rs. 5 lakh Rs 5,000 If you have incurred losses, like business and capital losses, they cannot be carried forward and set off in the subsequent years. However, an exception is available for losses from house property that can be carried forward even if you file your returns late. Deductions/ Exemptions Disallowed: Deductions/ exemptions u/s 10A, 10B, 80-IA, 80-IB, 80-IC, 80-ID and 80-IE shall not be available if you delay ITR filing. These tax-saving benefits are allowed only if the ITR is filed before the original deadline. Who is Eligible to File Form ITR-U Under Section 139(8A)? Any taxpayer can file an updated return u/s 139 (8A) whether he has furnished/not furnished an original return, revised return, or belated return in case of any omission, error, or wrong statement in his earlier return of income. An Updated Return can be filed if: Return previously not filed Income not reported correctly Wrong heads of income chosen Reduction of carried forward loss Reduction of unabsorbed depreciation Reduction of tax credit u/s 115JB/115JC Wrong rate of tax Who is Not Eligible to File Form ITR U u/s 139 (8A)? If an updated return is already filed If an updated return is the return of loss If an updated return reduces Income Tax Liability in the return filed earlier If the updated return results in an increase of Refund If a search has been initiated under Section 132 If books of Accounts or any other documents are called for by the Income Tax Department under section 132A. If the survey has been conducted under section 133A If any proceeding of assessment, reassessment, re-computation, or revision is pending or completed for that relevant year If the Assessing Officer has information against such person under the Prevention of Money Laundering Act or Black Money (Undisclosed Foreign Income and Asset) and Imposition of Tax Act or Benami Property Transactions Act or Smugglers and Foreign Exchange Manipulators Act and the same has been communicated to the assessee. If the information for the relevant assessment year has been received under an agreement referred to in section 90 or section 90A in respect of such person and the same has been communicated to him prior to the date of furnishing of return under this subsection. Other Notified Persons What is the Time Limit to File Updated Return? The time limit to file an updated return u/s 139 (8A) is 24 months from the end of the relevant assessment year. The updated return of FY 22-23 (AY 2023-24) can be filed till 31st March 2026. For example, Assessment Year Last Date of Updated ITR Filing AY (2021-22) 31 March 2024 AY(2022-23) 31 March 2025 AY(2023-24) 31 March 2026 How to File Belated Returns? Step 1: Log in to your account on the e-filing account Step 2:  Click on ‘e-File‘ > Choose ‘Income Tax Returns‘ and > Select ‘File Income Tax Return‘ Step 3: Select the relevant assessment year Step 4: If you select the mode of filing as ‘Online’, follow Steps 5-10.  Step 5: Click on the ‘Start new filing’ button Step 6: Select the applicable status

The income tax department strives to make it as easy and convenient for citizens to comply with advance tax payments. So, one has the option of paying it in 4 instalments over the financial year.  However, if you still default, there are some consequences in the form of an interest penalty. Basically, Section 234C deals with interest to be levied on defaulters of advance tax instalment payments. Section 234A: Delay in filing Income Tax Return All taxes should be paid before the end of a financial year. In case there is any outstanding tax, the balance should be paid and income tax returns filed on or before July 31 of every following assessment year (AY). If the tax returns are filed after this date, then the taxpayer is charged 1% simple interest every month of the outstanding tax amount. The interest is calculated from the due date of filing returns till the date the return is actually filed. Interest under Section 234A Delay in filing the return of income would result in a late payment interest to be levied as per Section 234A. Interest amount of 1% per month (simple interest) would be applied on the tax amount outstanding. Example: A taxpayer has unpaid taxes that are outstanding. He has not filed his IT Returns by the due date (31st Jul). The income tax payable was ₹ 23,300 and he filed his IT returns on 8th Nov. What will be the late payment interest levied on him under Section 234A  for the delayed filing of IT Return? Actual Filed Date: 08-NovDelay in Filing: 3 Months and 8 days delay (Delay is calculated from the due date of 31st Jul and is rounded as 4 months)Tax Payable: ₹ 23,300Late Payment Interest: 1 % * ₹ 23,300 * 4 months =   ₹ 932 Section 234B: Incomplete Payment of Tax In case an individual has to pay Rs 10,000 or more as tax in a fiscal year, then advance tax is applicable. The tax dues that are paid at a specific time period, as regulated by the Income Tax Department are termed as advance taxes. Businessmen, self-employed professionals, and salaried employees are liable to pay advance tax, where tax payable amounts to Rs 10,000. Under Section 44AD, when a taxpayer opts for computing business income, which has a turnover of 8% on presumptive basis, he is exempted from paying advance tax. Senior citizens above 60 years and with no income also enjoy tax exemptions under this section. The taxpayer should have paid the maximum amount (least 90%) of the total tax payable by the end of the financial year. Failure to pay the tax, if the amount is more than 10% of the liability, then a penalty of simple interest 1% will be charged under Section 234B. Advance Tax means paying your tax dues based on the dates (usually quarterly) provided by the income tax department. If you don’t pay advance tax, you may be liable to pay interest under section 234B. Interest under Section 234B Delay or shortfall in paying advance tax as per the income tax calendar would result in late payment interest to be levied as per Section 234B. All assesses are required to pay Advance Tax (at least 90 %) where the tax payable is Rs 10,000 or more. Late Payment Interest is applicable if the tax liability is more than Rs 10,000 and the taxpayer has not paid any advance tax or if the taxpayer has paid advance tax, but advance tax paid is less than 90% of ‘assessed tax’. Example (Not paying Advance Tax): A taxpayer has ₹ 15,400 as tax payable, but he has not paid any advance tax until 31st March. If the entire tax was paid by him 0n 3rd Oct, when he files the return of income, how much interest is he liable to pay as per Section 234B? Actual date of paying tax: 03-OctDelay in Filing: 6 Months and 3 days delay (Delay is calculated from 31st Mar which is the end of FY  and is rounded as 7 months)Tax Payable: ₹ 15,400Late Payment Interest: 1 % * ₹ 15,400 * 7 months =   ₹ 1,078 Example (Shortfall in paying any Advance Tax): A taxpayer has ₹ 38,500 as Tax Payable. He has paid ₹ 20,000 towards advance tax until 31st March. If the remaining ₹ 18,500 was paid by him 0n 25th Aug, when he files the return of income, how much interest is he liable to pay as per Section 234B? Actual date of paying tax: 25-AugDelay in Filing: 4 Months and 25 days delay (Delay is calculated from 31st Mar which is the end of FY  and is rounded as 5 months)Tax Payable: ₹ 38,500Advance Tax Paid: ₹ 20,000 (which is only 51.9 % of tax payable)Penalty to be applied for: ₹ 38,500 – ₹ 20,000 (Advance Tax that is paid already) = ₹ 18, 500Late Payment Interest: 1 % * ₹ 18,500 * 5 months =   ₹ 925 Section 243C: Delay in Periodic Payment of Tax Income tax should be paid on time every financial year to avoid interest and penalty on late payment. Advance tax can be paid on the dates mentioned below: 15% of advance tax on or before June 15 in case of corporate taxpayer. 45% and 30% tax advance to be paid by corporate and noncorporate taxpayer respectively, on or before September 15. 60% and 75% of tax advance by non-corporate and corporate taxpayers should be paid on or before December 15. 100% tax advance by both corporate and noncorporate taxpayers should be paid on or before March 15. Interest under Section 234C The following table provides the details on the cut off date and the advance tax payable: Due Date All Tax Payers except those who have opted for presumptive income u/s 44AD Taxpayers opting for presumptive income u/s 44AD 15th June Upto 15 % of Advance Tax Payable Nil 15th September Upto 45 % of Advance Tax Payable Nil 15th December Upto 75 % of Advance Tax Payable Nil 15th March Upto 100 % of Advance Tax Payable Up to 100% of Advance

E-filing users require a Digital Signature Certificate (DSC) to sign income tax returns, forms, and other electronic documents where authentication of the user is required. Hence, DSC serves as proof of identity for an individual or an organisation for online purposes. A Digital Signature Certificate is mandatory for certain taxpayers or to avail some services. The companies and political parties have to e-verify their income tax return through the digital signature certificate. Also, the persons whose books of accounts require a tax audit should e-verify their income tax returns. For others, it is optional.  Register Digital Signature Certificate (DSC) service on the New Income Tax Portal The registered taxpayers of the new e-filing portal can perform the following: Register their DSC Re-register DSC when registered DSC has expired/not expired Register DSC of Principal Contact Taxpayers who wish to use the DSC must re-register it on the new income tax portal. Due to technical reasons, the DSC registered on the old e-filing portal will not be migrated to the new e-filing portal. BENEFITS OF NEW PORTAL Modest Processes:Resetting passwords is easier now with OTP generated through Aadhaar-linked mobile numbers. Dashboard flex:A detailed dashboard with all the tax-related information of the account holder such as pending status, registrations, deposits, etc. Status of the taxpayer:Several other flexible processes for the taxpayer in an easy-to-use way. Free ITR software:ITR 3 will be implemented as soon as possible to file ITR easier and smarter. Query actions:This portal will help to resolve the queries immediately by the provided Serbs in the portal. Digital payments:This new portal Enabled UPI and taxpayers can register their bank details to pay taxes for the upcoming years in a more easy way. What is a (DSC) Digital Signature Certificate? DSC is proof of the identity of an organization or any individual taxpayer. Irrespective of the authentication, each digital taxpayer is mandatory to register their DSC. The digital users who have to function through e-filing and other various reports mandatorily have to sign with their DSC. The authentication data from DSC can be validated by a respected authority and the same must be updated in their portal. DSC is mainly for those taxpayers whose accounts are to be audited comes under section 44AB of the income tax act and it is optional for the rest. DSC cannot be registered by multiple users.As the government has tossed the new website, previous DSC data cannot be moved in due to security reasons. So it is notable that old users of DSC also have to update and re-register their DSC in the portal. REQUISITES BEFORE REGISTERING Keep embridge/emsigner utility downloaded and installed in your windows. Check with the extraction terms of the application. Be ready with the personal credentials including a valid PAN number or user ID and password. Plugin DSC token in the USB port. DSC USB token Must be a class 2 or class 3 certificate. The DSC should be active and not expired DSC should not be revoked   REQUISITES WHILE REGISTERING Check your PAN number and choose the next option Check with your windows extraction file of the utility. Be ready with your certificate file. Beware of fake utility extensions. Be focused while providing security information. REQUISITES AFTER REGISTERING: If you want to change your token code with a high-security code, click on the right side of your screen and select change pass. How to register DSC through the new income tax portal? Step 1 : To begin the registration, go to the e-filing portal https://eportal.incometax.gov.in/iec/foservices/#/login and click on login. (users need to log in with their respective login information such as User Id and password). Step 2 : Click on the dashboard and select my profile. Step 3 : Check your left side where you can find the word “register DSC”. Step 4 : Enter the user’s mail ID which is registered with DSC and then click “I have downloaded and installed emsigner utility”. Step 5 : Select continue for the registration in the last tab, you have to provide the token, certificate, and your password. Step 6 : Now, click on the sign box If the registration is successful a message box will pop up saying “your digital signature certificate (DSC) is registered successfully. FAQs When do I need to re-register my DSC? You will need to re-register your DSC either when the present DSC has expired or if you want to update the already registered DSC. Why is DSC required? E-Filing users who have opted for this facility require DSC to sign Income Tax Returns / Statutory Forms or to verify response against notices issued by Income Tax Department and refund reissue request. To sign or verify any document the user should have first registered their DSC with e-Filing system.

House rent allowance (HRA) is one of the important components of your salary. All employers have to provide HRA as compensation for house rental expenses. However, most of us are not aware of the fact that we can also save tax on it. The HRA amount is decided based on factors like the employee’s salary structure, actual salary and the city in which he/she is residing. WHAT IS HRA? House Rent Allowance (HRA) is the allowance you receive from your employer towards the rent of your house. It forms a part of the salary paid to you by your employer. HRA depends on multiple factors, such as your salary, city of residence, company’s salary structure, and more. Generally, HRA is a fixed percentage of your basic salary. You can claim a tax exemption on your HRA under Section 10(13A) and Rule 2A of the Income Tax Act, 1961. What is an HRA Calculator? In most Indian cities, the cost of living has risen considerably over the last decade or so. This is partly due to an increase in disposable income besides inflation. To ensure the welfare of their employees, many organizations provide a House Rent Allowance or HRA to the ones living in a rented home. This HRA calculator will help you determine the amount you receive as an allowance. After the recommendation of the 7th Pay Commission, the HRA slabs across India have been changed to a great extent. Cities have now been categorized into 3 distinct slabs. Slab X has the most urban cities where you clearly need an HRA exemption calculator. Slab Y covers marginally low-cost cities. How much of my HRA is exempt from tax? HRA received from your employer Actual rent paid minus 10% of salary 50% of basic salary for those living in metro cities 40% of basic salary for those living in non-metro cities The remainder of your HRA is added back to your taxable salary. Our calculator can easily help you figure out your HRA exemption. For example, let’s consider the following scenario:Raghu lives in MumbaiHe receives a HRA of Rs 1 lakh from his employer.His basic salary per month is Rs 50,000.Further, he has taken up an accomodation for which he pays a monthly rent of Rs 15,000.What is the quantum of HRA exemption he can claim? Sl. No. Head Calculation Amount 1 Actual HRA received from employer   100000 2 Actual Rent Paid (-) 10% of salary (15000*12) – 10% (50000*12) 120000 3 50% of Basic Salary 50% (50000*12) 300000 Least of the above 100000 HRA RULES FOR SELF-EMPLOYED INDIVIDUALS Self-employed individuals cannot generally claim HRA as this provision is valid only for salaried employees Self-employed individuals can claim the tax deduction on HRA under Section 80GG of the Income Tax Act, 1961, if the rent paid is a business expense. However, they should not own residential property in the same location or receive HRA from an employer to claim the tax deduction They can claim a tax deduction of ₹ 5,000 per month or 25% of the total income, whichever is lower under Section 80GG Self-employed individuals must submit the rent agreement as proof to claim the tax deduction The tax deduction can be claimed while filing the Income Tax Return (ITR) Tax deductions for self-employed individuals under Section 80GG are subject to the prevailing tax laws and may change over time. It is DOCUMENTS REQUIRED FOR HRA EXEMPTION CLAIM Copy of your PAN card Copy of the landlord’s PAN card Rent receipts for the concerned financial year Copy of the rent agreement FAQs How much of the HRA I earn is tax-exempt? The following slabs apply in this instance.  50% of basic salary for big metros.40% of basic salary for non-metro locales.Ordinarily, the gross HRA the employer pays is non-taxable. Can I claim HRA by paying rent to parents? A large number of salaried individuals live in their parents’ home, not in a rented accommodation. If you are given house rent allowance and live with parents, you can still get exemption on it by showing that you pay rent to your parents. To avail this exemption, your parents must be the owners of the house and they must show the rent you give as rental income in their income tax returns.

Form 26AS is a tax credit statement that provides a complete view of the taxes paid by a taxpayer. It includes details of income tax deducted at source (TDS), advance tax, self-assessment tax, and other tax payments made by the taxpayer. It also reflects details of tax credits available to the taxpayer, such as tax deducted on interest income, tax collected at source (TCS), and refunds received. Form 26AS is an annual statement that includes all the details about the tax deducted at source (TDS), information regarding the tax collected by your collectors. The advance tax you have paid, self-assessment tax payments, information regarding the refund you have received over a financial year, regular assessment tax that you have deposited, and information regarding high-value transactions regarding mutual funds, shares, etc., are concerned. What is Form 26AS? Form 26AS is a consolidated annual statement maintained by the Income Tax Department. It contains the tax credit information of each Taxpayer against his PAN. If you have paid any tax on your income or tax has been deducted from it, then the Income Tax Department has these details in their Form 26AS database. For NRIs, if they earn any income in India, such as Interest on an NRO account or any salary income and TDS has been deducted from it, then to claim the tax credit and view Form 26AS, one has to register under the Income Tax Department and should have PAN. What are the New Form 26AS Additions? Foreign remittance information reported in Form 15CC Information from Annexure-II of the last quarter’s Form 24Q related to TDS on salary Information from other taxpayers’ ITRs. Interest on a refund of income tax. Information on Form 61/61A that could be used to populate the PAN. Depository/Registrar and Transfer Agent report off-market transactions. The Registrar and Transfer Agent report information on mutual fund dividends. The Registrar and Transfer Agent report mutual fund purchases (RTA) information Information Available on Form 26AS Information about Tax Deducted at Source by deductors like employers/contractors; [TDS] Information about Tax Collected at Source by collectors; [TCS] Advance tax/self-assessment tax paid by the assessee; Details of tax refund (if any) made by the department during the last financial year and Specified Financial Transactions(SFT) details, mostly high-value transactions regarding shares, mutual funds, etc. Interest received from bank & others without deducting TDS in case of Form 15G/H. Tax deducted on selling immovable property Details of turnover as per GSTR 3b How to Use Form 26AS for Tax Planning and Compliance Regular Review: Check your Form 26AS regularly to ensure it aligns with your income sources and deductions. Resolve Discrepancies: If you find any mismatches, promptly contact the deductor or Income Tax Department for rectification. This helps prevent potential tax notices or penalties. Accurate Reporting: Accurately declare all income reflected in your Form 26AS while filing your income tax returns to claim correct tax credits and avoid additional tax liabilities. Reconcile Deductions: Verify that eligible deductions (e.g., donations, investments under Section 80C to 80U) are correctly reflected in your Form 26AS. If not, contact the relevant entities for updates. Track Refunds/Demands: Use your Form 26AS to monitor the status of tax refunds or demands, including assessment year, amount, and payment mode. Structure and Parts of Form 26AS Part I: Details of Tax Deducted at Source It provides you with the details of Tax Deducted at Source (TDS), Interest Income, Pension Income, etc. Also, it mentions the TAN of the deductor, an amount of TDS that has been deducted and deposited with the Government every quarter. Part II: Details of Tax Deducted at Source for 15G/H It has details about TDS for Form 15G/15H. In case, Form 15G/15H has not been submitted, this section will display “no transactions present”. PART-III – Details of Transactions under Proviso to section 194B/First Proviso to sub-section (1) of section 194R/ Proviso to sub-section(1) of section 194S Part IV: Details of Tax Deducted at Source on sale of immovable Property u/s 194IADetails of Tax Deducted at Source on Sale of Immovable Property u/s 194IA/ TDS on Rent of Property u/s 194IB / TDS on payment to resident contractors and professionals u/s 194M (For Seller/Landlord of Property/Payee of resident contractors and professionals) Seller of Virtual Digital Asset U/S194S. It contains details for TDS on the sale of immovable property like land, u/s 194-IA TDS on payment to resident contractors and professionals u/s 194M (for a payee of resident contractors and professionals) TDS on rent of property u/s 194IB (for the landlord of property) Part V – Details of Transactions under Proviso to sub-section Part – VI: PART-VI-Details of Tax Collected at Source Part VII: Details of Tax Collected at Source It contains details on Tax Collected at Source (TCS) by a seller of goods. Part VIII: Details of Tax Deducted at Source u/s 194IA/ 194IB /194M/194S (For Buyer/Tenant of Property /Person making payment to contractors or Professionals / Buyer of Virtual Digital Asset) Part IX: Details of Transactions/Demand Payments under Proviso to sub-section (1) of section 194S as per Form 26QE (For Buyer of Virtual Digital Asset) Part X: TDS/TCS Defaults* (Processing of Statements How Can I View and Download Form 26AS 1). By login into your income tax filing account on the Income Tax department’s e-filing website https://www.incometax.gov.in/iec/foportal/ 2). Through your net banking account if your PAN is linked to your bank account. 3) View tax credit from the traces site How to Download Form 26AS from Income Tax Website? Step 1: a) Go to the e-filing website “https://www.incometax.gov.in/iec/foportal/” b) On the top-right side, you will find the “Login option. Click on it. Step 2: a) Enter the required details like your PAN Number, Password, b) Click on Continue Step 3: a) Once you log in to your account. Take the cursor to the e-file tab. b) Click on “Income Tax Returns,” and you will get a drop-down list. c) From the menu, select “View Form 26AS d) Click on “Confirm.” This will take you to the Traces website. Step 4: Now you are at Traces’

An intimation u/s 143 (1) serves as a preliminary assessment of the taxpayer’s income tax return filed for a particular financial year. It is a message which notifies the taxpayer of any kind of error prevailing in his/her tax filing. It also tells the taxpayer of any kind of interest payable or refundable in his account. All the income tax returns filed by the taxpayers are first processed online at the Centralised Processing Centre (CPC). After processing the return, the income tax department then issues intimation under section 143(1) to the taxpayers informing them about the results. What is Intimation u/s 143 1? An income tax return can be either filed voluntarily under Section 139 or on demand by the income tax department under Section 142(1). It is necessary to understand what happens after the taxpayer has filed the return of income.  The process of examining the return filed by the taxpayer by the income tax department is termed assessment. The IT department carries out a preliminary assessment of all the returns filed and informs taxpayers of the result of such preliminary assessment. This assessment primarily includes arithmetical errors, internal inconsistencies, tax calculation and verification of tax payment. The preliminary evaluation process is fully computerised (automated), and is delegated to the Central Processing Centre (CPC). Thereafter, the system generates the intimation under Section 143(1), which generally indicates obvious errors identified by the mainframe system. Intimation u/s 143(1) of the income tax act is a summary of the details you have submitted to the tax department and the details the department has considered while processing your return. Basically, the intimation u/s 143(1) contains the following information: Permanent Details of the assessee like name, address, etc. Income Tax Return filing details like acknowledgment number, filing date, etc. Refund sequence number Tax Calculation as provided by you in the Return of Income Tax as Computed under section 143(1) of the income tax act {i.e. As per Department} Why is the intimation u/s 143(1) issued? Basically, when a return is submitted to the Income Tax Department, the department applies the following computerized checks as a part of its review procedure:Arithmetical errors in the return. An incorrect claim, which is apparent from any information in return. For example, if the deduction u/s 80C is claimed more than the maximum permissible deduction u/s section 80C, i.e., Rs 1,50,000, the excess shall be disallowed and reflected in your intimation u/s 143(1). Another example may be that rent income is deducted from business income, which is not shown under Income from House Property. Disallowance of expenditure indicated in the audit report but not taken into account in computing the total income in the return Comparison of Advance Tax, Self-assessment Tax and TDS, etc., from 26AS. Addition of income appearing in Form 26AS or Form 16A or Form 16 which is not included in ITR Claiming the losses for carry forward to next year when the return is submitted after the due date / set off of losses of the previous year where the return was filed after the due date. Whether deduction under section 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID, 80-IE has been taken after the due date of the Income Tax Return Calculation of Tax, Late filing fees, Interest, etc. When does one receive an Intimation under Section 143(1) Tax Refund: If the taxpayer has paid an excess amount of tax, the notification will mention the refund amount. Refunds exceeding Rs. 100 will be disbursed to the taxpayer, while amounts below this threshold will not be paid out. Tax Shortfall: If the taxpayer has underpaid taxes, as determined through computation, the notice will specify the deficient amount. Additionally, a challan for making the required payment will be enclosed with the notice. Conformance Notice: A straightforward notice will be issued in cases where the tax returns filed by the taxpayer align with the assessment conducted by the assessing officer. In such instances, no separate 143 1 intimation is sent, and the taxpayer should consider the ITR V acknowledgement of filing the return of income as the intimation notice. Centralized Processing Center The Finance Act, 2008 empowered the Central Board of Direct Taxes (CBDT) to make a scheme for the centralised processing of returns with a view to expeditiously determine the tax payable by, or the refund due to the taxpayers. Based on the recommendations of the Technical Advisory Group, the department adopted the strategy that CPC at Bangalore would process paper and e-returns without any interface with taxpayers and in a jurisdiction free manner. CPC project envisaged benefits for the citizens as well as the tax department. For citizens, it led to faster and hassle-free preliminary processing of their returns and also relieved the department from the burden of preliminary assessment that can be computerised,  enabling them to concentrate on hardcore activities. Any communication from the income tax department creates panic for taxpayers. However, Section 143(1) intimation is not something one needs to worry about. In this article, we would be discussing the intimation sent under Section 143(1) in detail to  help taxpayers easily deal with such intimation. Preliminary Assessment under 143(1) Initial processing of returns by CPC is completely automated and Section 143(1) Intimation is also a computer generated record. CPC validates data provided in each tax return with details available with the income tax department’s own record (such as Form 26AS generated through details provided by collecting banks, TDS returns, etc.) and this notice usually only points out apparent mistakes found out by the mainframe system. Once the return is filed, total income or loss is recomputed by the computerised system as per the department’s record and provides a comparison with data filed by the taxpayer The intimation has two columns: ‘As provided by the taxpayer in the Return of Income’ and ‘As computed under Section 143 (1)’ Comparison is made for major categories such as  Income under various heads,  Gross total income, Deductions under Chapter VIA (80C, 80D, etc.), and  Tax deducted at source, and tax paid by taxpayers in the form of advance

Income tax calculator is a tool available online that aids in calculating the amount of income tax payable by an individual in a particular financial year. The tax calculator provides an approximate figure of your income tax liability by taking into account various data such as your income, tax deductions, HRA exemption, etc. You can pay income tax either as tax deduction at source during the payment of your monthly salary or via the Income Tax returns portal operated by the Central Board of Direct Taxes (CBDT). What is Income Tax Calculator An Income-tax calculator is an online tool that helps to evaluate taxes based on a person’s income, his respective tax slab and tax liability. Individuals falling under the taxable income bracket are liable to pay a specific portion of their net annual income as tax. Income tax can be paid either as tax deducted at source while disbursement of monthly salary, or through the income tax returns portal managed by the Central Board of Direct Taxes (CBDT). The provision for online payment of taxes is to ensure individuals pay their stipulated dues on any earnings generated from other sources. How to Use the Online Income Tax Calculator? Follow the below-given steps to use the Indian Income Tax Calculator: Choose the assessment year for which you want to calculate the tax. If you are looking for FY 2023-24, then the AY would be 2024-25, which you can select from the dropdown menu. In the next field, select your age. As already mentioned, Income tax in India differs based on different age groups. Next, click on the ‘income field’. Provide the details of your gross salary (monthly or yearly salary paid without any deductions). Also, you have to fill in other details like annual income from other sources such as rental income, annual interest paid on home loans for the self-occupied and let-out property. Next, enter the details of various deductions, viz. basic deductions u/s under Section 87A, 80C, 80CCD (1B), 80D, 80G, 80E, 80TTA, 80TTB, 80GG. Also, provide the details of interest on an educational loan and on deposits on the savings account. In the next step, provide the details of HRA exemption such as basic salary, DA, HRA, and total rent paid per annum. Finally, select whether you live in a metro city and hit the calculate button to obtain your tax liability. How to Understand Income Tax Slabs? The Indian Income-tax works on the basis of a slab system and the tax is levied accordingly on individual taxpayers. Slab implies the different tax rates charged for different income ranges. In other words, the more your income, the more tax you have to pay. These slabs of income tax are revised every year during the budget announcement. Again, These slab rates are segregated for different categories of taxpayers. As per the Income-tax of India, there are  three categories of “individual “taxpayers such as: Individuals below 60 years of age, including residents and non-residents Resident Senior citizens – 60 to 80 years of age Resident Super senior citizens – more than 80 years of age Exemptions on Total Income Tax Here’s how to calculate income tax based on exemptions- Section 87A – Income below Rs. 5 lakh is eligible for a tax rebate of up to Rs. 12,500. Section 80C – Rebate of up to Rs. 1.5 Lakh in any tax-saver fixed deposits, public provident funds, national savings certificate, unit-linked insurance plans, and equity-linked savings schemes on the interest income. Section 80CCD (1B) – Tax exemption of up to Rs. 2 lakh for money deposited in the national pension system. Section 80D – Up to Rs. 25,000 tax exemption on medical insurance premium bills. The limit rises to Rs. 50,000 for senior citizens. Section 80G – Any donations made to charitable organizations are fully exempt from tax calculations. Section 80E – Interest on education loan enjoys a 100% tax rebate for up to 8 years. Section 80TTA/80TTB – Interest income from savings accounts is eligible for tax waivers up to Rs. 10,000. For senior citizens, all forms of interest income up to Rs. 50,000 are fully waivered from tax calculations, under Section 80TTB. Section 80GG – Tax exemption on income spent towards paying house rent (house rent allowance.) How to Calculate the Total Income Tax Liability? How is income tax calculated is often a commonly asked question. Individuals can determine the total tax expenses through an online income tax calculator. Such tools take into account the following pointers to reflect the actual tax liability of a resident or non-resident Indian at the end of a financial year – Annual income from salary/profits. Income from other sources such as investments, rental income, etc. Tax exemptions applicable, if any. House rent and transport allowance. Entering accurate data regarding the above-mentioned pointers will demonstrate the total tax liability of individuals. Minus the taxes already paid through TDS, the remaining can be deposited directly online through the official portal Challan 280. If, in any event, the taxes paid exceed the total liability, the difference is reimbursed by the government within 30 days of filing for the same. Taxpayers who file their return after the due date will have to pay interest under 234A and penalty under section 234F. Hence, remembering the due date of filing income tax returns is indispensable. However, keep in mind that the due date varies according to the category of taxpayers. For instance, if you are a salaried individual, usually you must file your income tax returns by the 31st of July of the assessment year. FAQs What do you mean by Income Tax? Income tax is a tax levied on an individual’s or business’s annual income. It is calculated, assessed, and collected on the basis of the individual’s/business’s income for a particular financial year. Income tax in India is implemented through the income tax Act, 1961. How is my tax calculated on salary? It involves several steps, such as calculating your gross salary, figuring out deductions and exemptions, figuring out how much tax you owe, deducting tax you have already paid, etc.

The new income tax slabs in the financial year 2023-24 differ depending on the tax regime you choose. In India, taxpayers get a choice between two tax regimes – the old regime and the new regime. Under the old tax regime, individuals have the option to claim various deductions and exemptions to reduce their taxable income. While this grants taxpayers the benefit of reducing their overall tax liability, the trade-off is a higher tax rate. The old regime classifies taxpayers into three distinct categories based on age – below the age of 60, between the ages of 60 and 80 and over the age of 80. The income tax slabs are different under the old and the new tax regimes. Further, the slab rates under the old tax regime are divided into three categories Indian Residents aged < 60 years + All the non-residents  60 to 80 years: Resident Senior citizens More than 80 years: Resident Super senior citizens What is Income Tax Slab? In India, income tax is levied based on a slab system. This means different tax rates are applied to different income ranges. As your income increases, so does the tax rate. This progressive system ensures that higher earners pay a higher percentage of their income in taxes. The Income Tax applies to individuals based on a slab system, where different tax rates are assigned to different income ranges. As the person’s income increases, the tax rates also increase. This type of taxation allows for a fair and progressive tax system in the country. The income tax slabs are revised periodically, typically during each budget. These slab rates vary for different groups of taxpayers. Income Tax Slabs for FY 2023-24 (AY 2024-25): Old vs. New Regime Income Tax Slabs under Old Tax Regime For Individuals Below 60 Years & NRIs Income Tax slab (Rs.) Tax Rate Up to 2,50,000 Nil 2,50,001 – 5,00,000 5% 5,00,001 – 10,00,000 20% Above 10,00,001 30% For Senior Citizens (60 to 80 years) Income Tax slabs (Rs.) Tax Rate Up to 3,00,000 Nil 3,00,001 – 5,00,000 5% 5,00,001 – 10,00,000 20% Above Rs. 10,00,001 30% For Super Senior Citizens (Above 80 years) Income Tax slabs (Rs.) Tax Rate Up to 5,00,000 Nil 5,00,001 – 10,00,000 20% Above 10,00,000 30% Note: A rebate of up to ₹12,500 is applicable if the total income does not exceed ₹5,00,000.   Income Tax Slabs under New Tax Regime Income Tax Slab (Rs.) Tax Rate Up to 3,00,000 Nil 3,00,001 – 6,00,000 5% (Tax Rebate u/s 87A) 6,00,001 – 9,00,000 10% (Tax Rebate u/s 87A up to Rs 7 lakh) 9,00,001 – 12,00,000 15% 12,00,001 – 15,00,000 20% Above 15,00,000 30% Note: A rebate of up to ₹25,000 is applicable if the total income does not exceed ₹7,00,000. Surcharge and Cess In addition to the basic tax rates, a surcharge and cess are applicable: Surcharge: 10% of income tax if total income exceeds ₹50 lakh but does not exceed ₹1 crore. 15% of income tax if total income exceeds ₹1 crore but does not exceed ₹2 crore. 25% of income tax if total income exceeds ₹2 crore but does not exceed ₹5 crore. 37% of income tax if total income exceeds ₹5 crore. Note: In Budget 2023, the highest surcharge rate was reduced from 37% to 25% under the new tax regime. Health and Education Cess: 4% of income tax and surcharge. Tax Slabs for Domestic Companies Particulars Old Regime Tax Rates New Regime Tax Rates Company opts for section 115BAB (not covered in section 115BA and 115BAA) & is registered on/after October 1, 2019 and has started manufacturing on/before 31st March 2023 – 15% Company opts for Section 115BAA , where the total income of a company has been calculated without claiming specified deductions, exemptions, incentives, and additional depreciation – 22% Company opts for section 115BA registered on/after March 1, 2016, and is in the manufacture of any article or thing and does not claim a deduction as specified in the section – 25% Turnover/gross receipt of the company is less than ₹400 crores in the previous year 25% 25% Other Domestic Company 30% 30% Surcharge applicable for companies: 7% of Income tax where total income is more than ₹1 crore 12% of Income tax where total income is more than ₹10 crores 10% of income tax where domestic company opted Section 115BAA and 115BAB Additional Health & Education Cess Rate – 4% Income Tax Rate for Partnership Firm or LLP as Per Old/New Regime A partnership firm or an LLP is taxable at 30% Note – A Surcharge of 12% is levied on incomes above Rs 1 crore. Health and Education Cess Rate – 4 % Choosing Between Old and New Regime Old Regime: Suitable if you have significant deductions and exemptions (e.g., 80C, 80D, HRA). New Regime: Ideal for those with minimal deductions and seeking simplified filing.  Deductions and Exemptions under New Tax Regime Certain deductions and exemptions present under the old tax regime will not be applicable under the new tax regime. Around 70 deductions and exemptions that are present in the old tax regime will not be applicable in the new tax regime. Some of the common deductions that are allowed and not allowed in the new tax regime are mentioned below: Deductions that are Allowed Travelling allowance in the case of transfer or for employment Apart from additional depreciation, other deductions under Section 32 Deduction under Section 80JJAA for new employees (employment) Any investments that are made in the Notified Pension Scheme (Section 80CCD(2)) Any conveyance allowance due to work travel Specially abled individuals will be provided transport allowance Deductions that are Not Allowed Housing Loan interest under Section 24 Professional tax Standard deduction on salary Special allowances under Section 10(14) Children education allowance Helper allowance Relocation allowance Conveyance allowance House Rent Allowance Leave Travel Allowance   Old Tax Regime Vs New Tax Regime with Example Here’s a simple example to illustrate: Let’s consider an example to see the tax calculation under both regimes. Example: Rohit has

As per Section 194I, the word rent can be described as a payment categorised as a lease, sub-lease, tenancy, or any agreement to use – land, building, machinery, plant, equipment, furniture, fittings, or land adjunct to a building. Regardless of whether the payee owns it or not. Also, sub-letting is considered a rent payment.  Being an essential component of income for many individuals, rent is subject to taxation. To streamline the payment of TDS on rent successfully, individuals need to pay it on time and as per the provisions of ITA.  What is TDS on Rent? According to Section 194I, an individual who pays rent is subject to tax deduction at the source. One must note that TDS can be deducted when the amount of tax to be paid or received in a given fiscal year is over Rs. 180000.  Typically, HUFs and individuals are liable to pay TDS at the rate of 5% of the total rent that is collected when the rent is more than Rs. 50000. One must note that the rent that is paid out to government agencies or bodies is exempted from TDS.  What is Section 194I? The person (not being an Individual or HUF) who is responsible for paying of rent is liable to deduct tax at source. TDS threshold for deduction of tax on rent is Rs 2,40,000 for the FY 2024-25 (the threshold limit was Rs. 1,80,000 until FY 2018-19). Also, individuals and/or HUFs who are subject to tax audit are under an obligation to deduct the tax at source. TDS on rent is required to be deducted at source at the time of credit of ‘income by way of rent’ to the account of the payee or at the time of payment, thereof, in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier. Objective of TDS u/s 1941 he Finance Act, 1994 inserted Section 1941, on basis of deduction of tax from rent.  The government established the provision to cover the income by way of rent under TDS. In other countries, such income is subject to deduction of TDS. Importance of Section 194I In India, a lot of people, including individuals and HUFs, buy properties for investment needs. Here the primary motive was to sell the property at an appreciated rate in the future or rent out the property for getting rent. Thus, the rent collected is one of the most important components of income for a lot of people, including individuals and HUFs in the country.  Due to this, the finance minister has considered the need to introduce Section 194I, which would have the tax deduction from the rent in the Income Tax Act. Another reason for being is that in other countries, income from renting property is already subject to TDS. Who Has to Deduct TDS Under Section 194I? Based on Section 194I of the Income Tax Act, a person is eligible for a TDS deduction if they will be paying their landlord a total of Rs 1.80 lakhs in rent in a financial year and have already debited that amount or are likely to do so. Rate of TDS Under Section 194I TDS is deducted when the payee credits ‘income by way of rent’ to the landlord’s account. One must note that if rent is paid through cash, cheque, or draft, then TDS is deducted at the time of payment. Here is the TDS rate on rent- TDS on rent paid on plant, machinery, or equipment is to be charged at 2%. TDS on the rent paid on land, building, or both of it is to be charged at 10%. TDS on the rent paid on furniture or fitting is charged at 10%. Payments Covered Under Section 194I Tax is deducted at varied rates for different assets such as furniture, factory, building, hotel, and more. 1) Rent from Factory Building When a factory building is rented, the lessor or factory owner is required to pay the rent. The Lessor may occasionally receive it as property-related income. In these circumstances, the lessor will be required to pay an advance tax and return the rent income since the tax will be deducted at the source because the rent is regarded as business income. 2) Rent from Cold Storage Cold storage facilities that hold milk, vegetables, or ice cream are regarded as plants and are not subject to building rent. 3) Two people renting from a building or piece of furniture When the building and furnishings are rented out by two distinct people, the tax is only subtracted from the rent for the building. 4) Hall Leased to an Organization In the event that an association hires a hall, tax is subtracted if the rent is more than Rs. 1,80,000. 5) Hotel room rental for seminars with meals Tax is withheld at the source when hotels simply charge for food or catering and not for utilizing the facilities. At the same time, Section 194C is used for catering. 6) Tax Reduction Depending on the Rent Period Taxes are not always withheld on a monthly basis by law. It is determined by the rental time and is subtracted accordingly. For instance, if the rent is paid annually, the tax deduction is also made annually. 7) Servicing Fees Owed to Business Centers Rent is often regarded as the service fees paid to business centres. Section 194I – Exemption and Deduction at Lower Rate Exemptions  TDS on rent is not applicable in the following cases – When the amount to be paid or has been paid is less than Rs. 180000 in a fiscal year. Then the rent is paid to a government agency. When the earnings are shared by a film exhibitor and distributor who own a cinema theatre. In case it is an individual tenant or HUF TDS without Service Tax Service tax is applied on TDS only when the aggregate rent from one or more sources in a given fiscal year is more than Rs.10 lakh. Ideally,

When it comes to managing your finances, staying up-to-date with tax payments is crucial. While many people anticipate receiving a refund when filing their income tax return, there are instances where you may owe additional taxes instead. This could happen due to underpayment during the tax year, adjustments in deductions, or changes in income. In such cases, you may need to make additional payments to the Income Tax Department to settle your outstanding balance. If you’re filing an original ITR, revised ITR, updated income tax return (ITR-U), or a belated return, you might encounter penalties and interest charges. Minor heads may change depending on the payment you are making. For example, If you are paying for some outstanding demand then you might need to choose Regular Assessment tax (400) or if you are paying regular tax then you need to choose self-assessment tax (300). Understanding how to make these payments online is essential for avoiding further complications and ensuring your tax matters are in order. What is Self Assessment Tax and How to Pay it Online? Self Assessment Tax is the portion of tax paid by individuals on their taxable income that is not subjected to TDS (Tax Deducted at Source) or Advance Tax payments. It enables taxpayers to reconcile their total income, compute tax liability, and pay any outstanding dues. To pay Self Assessment Tax online, you can visit the income tax department’s official website, select the appropriate challan, fill in the required details, and make the payment using net banking or debit card options. Why Should You Pay Self Assessment Tax? Paying Self Assessment Tax is crucial as it ensures compliance with the tax laws of our country. Failing to pay your due taxes or underpaying it can lead to penalties, interest charges, and legal consequences. It is essential for fulfilling one’s tax obligations honestly and in a timely manner. Self assessment is one of the easiest ways of filing income tax returns online. You can follow the instructions given on the Income Tax e-filing website to file self-assessment and calculate your outstanding dues by checking Form 26AS or AIS. Furthermore, there is no strict deadline; you have an entire financial year to file your self assessment returns. Characteristics of Self Assessment Tax It is payable by individuals, including salaried employees, freelancers, professionals, and business owners. It is calculated on the total income derived from various sources, excluding the amount already subjected to TDS or advance tax payments. It is calculated, filed, and paid by taxpayers themselves and not through an employer or other entities. It must be paid before the annual income tax return filing deadline. It is applicable when your total tax liability exceeds the TDS deducted amount. Interest is levied on delayed payment of Self Assessment Tax. Eligibility for e-Tax Payment Starting from April 1, 2008, certain taxpayers are required to make their tax payments online. This mandatory requirement includes the following categories of taxpayers: All corporate assesses: This includes all companies, regardless of their size or type of business. All assesses (other than companies) to whom the provisions of section 44AB of the Income Tax Act, 1961 are applicable: This refers to non-corporate taxpayers who meet the criteria specified in section 44AB of the Income Tax Act, 1961. Section 44AB pertains to the mandatory tax audit requirements for businesses or individuals meeting specific financial thresholds. Benefits of Income Tax Online Payment Convenience: Online payment methods offer a high level of convenience. Taxpayers can make payments from anywhere, anytime, as long as they have an internet connection. This eliminates needing to visit a tax office or mail a physical payment. Time-saving: Online payment systems streamline the process, allowing taxpayers to complete their transactions quickly. It eliminates the need for manual paperwork, filling out forms, and waiting in long queues. Accuracy: Online payment platforms often have built-in calculators that help taxpayers determine the correct amount of tax owed. This reduces the chances of errors in calculations and ensures accurate payment. Instant confirmation: When making an online payment, taxpayers receive immediate confirmation that their payment has been processed. This provides peace of mind and eliminates uncertainty about whether the payment was received and credited. Secure transactions: Reputable online payment platforms employ robust security measures to protect users’ financial information. Encryption techniques and secure servers ensure that sensitive data is transmitted and stored safely. Reminder notifications: Some online payment platforms offer reminder services, sending notifications to taxpayers when payment deadlines are approaching. This helps taxpayers stay organized and avoid late payment penalties. Verification: By visiting the website of the Tax Information Network, you can verify if the IT department has received the payment or not. Documents required for paying Income Tax Online Form 16 Form 16 Salary slips and bank statement Form 16A, Form 16 B, or Form 16C Interest certificates issued by bank or post office Form 26AS Tax saving investment proof Aadhaar Card PAN Card Home loan statement Capital gain Statement How to e-Pay Income Tax Online? Step 1: To begin, go to the official Income Tax portal at https://www.incometax.gov.in/iec/foportal/. Then, find and select “e-Pay Tax” from the menu on the left side of the screen Step 2: Enter the PAN/TAN details along with your mobile number. (If you’re making the payment on someone else’s behalf, use their PAN number; however, you can input your mobile number regardless of the payer). Subsequently, you’ll receive a One-Time Password (OTP) on your registered mobile number. Enter the OTP and proceed by clicking ‘continue.’ Step 3: Once you’ve entered the OTP, a new page will appear confirming the successful verification of your mobile number. Proceed by clicking the ‘continue’ button. Step 4: On this page, you’ll find multiple payment options available. If you’re making an income tax payment such as advance tax or additional tax, locate the first payment box labeled ‘Income Tax’ and click on the proceed button. Step 5: Choose the assessment year and your payment type from the drop-down menu. If you’re paying additional tax, interest, or a penalty for late ITR filing, select “Self-Assessment Tax (300)” and then click on ‘Continue.’ Step 6: Fill the payment amount correctly under the relevant categories.