ITR stands for “Income Tax Return”. It refers to a document or form that individuals or businesses are required to file with the tax authorities to report their income earned and taxes paid during a given financial year. The purpose of filing an ITR is to calculate the amount of tax liability owed to the government or to claim a refund of excess taxes paid.
Who is required to submit an ITR
- Individuals earning above the government-set limit (2.5 Lakhs/3 Lakhs/5 Lakhs) are required to file an income tax return.
- If someone has assets in other countries that generate income, they must file a tax return.
- Individuals paying more than Rs. 1 lakh on their electricity bill in a year are required to file an ITR.
- If someone deposits more than Rs. 1 crore in one or more bank accounts in a year, they need to file an income tax return.
- Individuals spending more than Rs. 2 lakhs on overseas travel in a year are required to file an ITR.
- If an individual’s gross total income exceeds the exemption limit before claiming tax exemption on capital gains under sections 54, 54B, 54D, 54EC, 54F, 54G, 54GA or 54GB of the Income-tax Act, they need to file an income tax return.
- If a business has made sales or earned income of more than Rs 60 lakh during the financial year, they need to file an income tax return.
- Professionals earning more than Rs 10 lakh during the year need to file an income tax return.
- Individuals who have paid or collected more than Rs 25,000 in tax deducted at source (TDS) or tax collected at source (TCS) during the year, need to file an income tax return. For senior citizens, this limit is Rs 50,000.
- If someone has deposited Rs 50 lakh or more in one or more savings bank accounts during the year, they need to file an income tax return.
We understand that timely filing of Income Tax Returns (ITR) is crucial for individuals and businesses alike. Not only does it help in avoiding penalties and interest on late payment, but it also provides several benefits. In this article, we will discuss the benefits of filing ITR on time for the FY 2022-23 and how it can positively impact your financial wellbeing.
- Timely ITR filing avoids penalty and interest Filing ITR within the due date of the financial year, i.e., July 31, or extended due date, ensures that you do not have to pay any penalty or interest on late filing. This is crucial as the penalty can range from Rs.1,000 to Rs.10,000, depending on the delay. Moreover, interest is charged at 1% per month on the outstanding tax amount until it is paid.
- Early ITR filing helps in timely processing of refunds Filing ITR early can help in faster processing of refunds by the Income Tax Department. This is especially important for individuals who are eligible for refunds but have not received them due to the delayed filing of returns. Early filing ensures that the refund is processed within a reasonable time, and you can receive it sooner.
- ITR filing is a mandatory requirement for various financial transactions ITR filing is mandatory for individuals and businesses for several financial transactions such as taking a loan, applying for a visa, or registering a property. Timely filing of ITR ensures that you have a clean and updated record of your tax compliance, which is essential for these transactions.
- Filing ITR is essential for establishing financial credibility Filing ITR on time helps in establishing financial credibility, especially for individuals and businesses seeking loans or investment opportunities. It shows that you have a clean financial record, which is crucial for any financial institution or investor to trust you with their money.
- ITR filing helps in availing tax benefits and exemptions Filing ITR on time is essential for availing various tax benefits and exemptions. For instance, if you have incurred losses in a particular financial year, timely filing of ITR can help in carrying forward those losses to the subsequent years and claiming tax benefits accordingly.
In conclusion, timely filing of ITR is essential for individuals and businesses alike. It not only helps in avoiding penalties and interest on late payment but also provides several benefits, such as faster processing of refunds, establishing financial credibility, and availing tax benefits and exemptions. So, ensure that you file your ITR on time for the FY 2022-23 and reap the benefits.
Deadlines for filing ITR in FY 2022-23
The following is a list of taxpayer categories and their respective due dates for filing Income Tax Returns for the fiscal year 2022-23:
|Category of Taxpayer||Due Date of ITR FY 2022-23|
|Individual/HUF/AOP/BOI (books of accounts not required to be audited)||31st July 2023|
|Businesses (Requiring Audit)||31st October 2023|
|Businesses requiring transfer pricing reports (in case of international/specified domestic transactions)||30th November 2023|
|Revised return, Belated Return/Late Return||31st December 2023|
This table provides a quick and easy-to-read reference for taxpayers to determine their respective due dates for filing their Income Tax Returns.