Income Tax Compliances

Income Tax Compliances

Income Tax Compliances

PAN Card Registration

Permanent Account Number (PAN) is a unique, 10-character alpha-numeric identifier issued by Income Tax Department under the control of Central Board of Direct Taxes (CBDT) to all judicial entities recognizable under the Indian Income Tax Act, 1961.

The Permanent Account Number (PAN) is unique, national and permanent and cannot be altered or modified by change of address. even between states in India. As a unique identification number PAN helps to monitor all financial transactions, taxes paid, refund issued, income disclosed, arrears of tax and also serves as an important proof of identification. 

To overcome the short comings in the old system called General Index Register (GIR) Number, Permanent Account Number (old series) was first introduced during the year  1972 and made statutory under section 139 A of the Income Tax Act w.e.f. 1st April,1976. There were short falls in the PAN old series like no check on issue of multiple  pan cards,  allotment of pan was not centralized and no proper data was available to check details of pan cards issued and data captured was very much limited.  

The government has amended section 139 A of Income Tax Act 1961 w.e.f 01.07.1995 enabling allotment of PAN under new series, which covered all the limitations of the PAN old series.  Applications for allotment of PAN under new series were made mandatory in Delhi, Mumbai and Chennai w.e.f. 01.06.1996, and in rest of the country w.e.f. 11.02.1998. The new series  w.e.f. 01.07.1995 facilitates easy retrieval of information of PAN card holder and also facilitates linking of various documents and information, taxes paid, tax demands, arrears of tax, financial transactions etc., relating to an assessee.

Pan card registration is done through Kireeti consultants

Procedure for application - On request we provide a simple form to be filled online and after submission of necessary documents through mail, our team will apply for PAN card. Finally, the PAN card will be despatched to your registered address  

Who should file income Tax Returns(ITR)Form

  1. If your total income exceeds the basic exemption limit of Rs. 2,50,000/-
  2. If you have assets outside India
  3. If you deposit more than Rs .1 crore in a bank account.
  4. If you incur Rs. 2 lakh on foreign travel.
  5. If your electricity Consumption is Rs. 1 lakh per annum.
  6. If Turnover of your business is more than Rs. 60 lakh in a year.
  7. If Gross Receipt from Profession is more than Rs. 10 lakh.
  8. If TDS is Rs. 25,000 or more
  9. If TCS is Rs. 50,000 or more.
  10. If deposit in a saving bank account is Rs.50 lakh or more

Income Tax Return - ITR-1 Form Filing – Sahaj Form

ITR Filing is Mandatory in 10 Situations.

According to Section 139 (1) of the Income Tax Act, 1961 of India, individuals whose total income during the previous year is more than the maximum amount not chargeable to tax, should file their ITR or income tax returns. When such individuals file their income tax returns online, the process is known as e-filing.

Kireeti Consultants has a team of Income tax professionals and other professionals provide a comprehensive service in filing Income tax returns for individuals, HUF, firms and corporates and support them in complying with tax compliances. Our expert team, will respond to you query and provide necessary help in filing the income tax returns.

When Should ITR-1 be filed?                                                      

ITR1, also known as Sahaj, is applicable for individuals or HUF (Hindu Undivided Family) has income that is within Rs. 50 Lakhs and when the source of income for the Financial Year falls into any of the below categories:

  1. Income from Salary / Pension
  2. Income from just one house property
  3. Income from other sources such as interest from fixed deposits/Savings accounts, NSC interest, spousal pension etc. (excluding Winning from Lottery, Racehorses, income from foreign assets, Capital Gains, Business or Profession, Agricultural income that exceeds Rs. 5000).
  4. In case of clubbed Income Tax Returns from a spouse or a minor. This can be done only if their income is also limited to the above specifications.

Who should not file ITR-1?

ITR-1 form should not be filed for below cases:

  1. Income that exceeds Rs. 50 Lakhs
  2. Assessee has Taxable Capital Gains
  3. Assessee has any of the below sources of income:
    1. Income from foreign assets
    2. Agricultural income that exceeds Rs. 5000
    3. Income from Business or Profession

What is the Due Date for filing ITR-1?

ITR-1 form must be filed by individuals and HUFs on or before 31st July of every year.

What is the Penalty for Late filing ITR-1?                                                    

  1. If filed before 31st December- Rs.5000
  2. If filed before 31st March - Rs. 10,000

Income Tax Return - ITR- 2 Form Filing

When Should ITR-2 be filed?

ITR-2 must be filed by individuals and HUFs who are not eligible to file ITR-1 Sahaj form, because of following reasons:

  1. Accrued income through the sale of assets or property (Capital Gains)
  2. Income from more than one housing property
  3. Income from countries outside of India
  4. Income as a partner in any firm (not proprietorship)
  5. Income from agriculture above Rs 5,000
  6. Income from any windfall such as lotteries or horse racing
  7. Income from Salary/Pension, Housing Property, Other sources that exceeds Rs. 50 Lakhs

Who Should not file ITR-2 ?

ITR-2 form should not be filed by any individual who has income under the head of Business or Profession from a proprietorship. ITR-2 form can also not be filed by a company or LLP or other types of legal entity.

What is the Due Date for filing ITR-2?

ITR-2 form must be filed by individuals and HUFs on or before 31st July of every year.

What is the Penalty for Late filing of ITR-2?

  1. If filed before 31st December- Rs.5000.
  2. If filed before 31st March - Rs. 10,000.

Income Tax Return - ITR- 3 Form Filing

When Should ITR-3 be filed?

ITR-3 form is to be used when the assessee has income that falls into the below category:

  1. Income from carrying on a profession
  2. Income from Proprietary Business
  3. Along with income from a profession or proprietary business, return may also include income from House property, Salary/Pension and Income from other sources.

Tax Audit may be required for ITR-3 filing

Who should not file ITR-3?

If an Individual/HUF is having income as a partner of a partnership firm that is carrying out business/profession, he cannot file ITR-3. In such case, he is required to file ITR 2.

What is the Due Date for filing ITR-3?

Due date for filing income tax return is 31st July for Individuals and 30th September for Businesses.

What is the Penalty for Late filing of ITR-3?

  1. If filed before 31st December- Rs.5000
  2. If filed before 31st March - Rs. 10,000

Income Tax Return - ITR- 4 Sugam Form Filing

When Should ITR-4 be filed?

ITR-4 form is to be used when the assessee (Individuals, Hindu Undivided Families or a Firm (Other than LLP)) has income that falls into the below category:

  1. Income from carrying on a profession and has opted for presumptive income scheme as per section 44 ADA.
  2. Income from Proprietary Business and has opted for presumptive income scheme as per section 44 AD or section 44AE
  3. Along with income from a profession or proprietary business, return may also include income from House property, Salary/Pension and Income from other sources.

Who should not file ITR-4 ?

ITR-4 cannot be filed by taxpayers who fall into the below category:

  1. Businesses with turnover of over Rs. 2 Crores
  2. Professionals with gross receipts exceeding Rs. 50 Lakhs

          In the above cases ITR-3 should be filed.

Companies cannot file ITR-4 as it is applicable only for individuals / HUFs and Professionals. Companies need to file ITR-6 or ITR-7 based on applicability.

What is the Due Date for filing ITR-4?

Due date for filing income tax return is 31st July for Individuals and Businesses.

What is the Penalty for Late filing of ITR-4?

  1. If filed before 31st December- Rs. 5000
  2. If filed before 31st March  - Rs. 10,000

Income Tax Return - ITR-5 Form Filing

When should ITR-5 be filed?

ITR-5 form is to be used when the assessee is one of the following:

  1. Firms
  2. LLPs (Limited Liability Partnerships)
  3. AOPs (Association of persons)
  4. BOIs (Body of Individuals)
  5. Artificial juridical person
  6. Cooperative society
  7. Local authority

Who should not file ITR-5?

ITR-5 cannot be filed by Taxpayers who fall under the below category:

  1. Assessees who are required to file the return of income under section 139(4A) or 139(4B) or 139(4C) or 139(4D) (i.e., Trusts, Political party, Institutions, Colleges, etc.)
  2. Individuals, HUFs (Hindu Undivided Families), Companies

What is the due date for filing ITR- 5?

Due date for filing the income tax return is 31st July.

What is the penalty for late filing of ITR-5?

  1. If filed before 31st December- Rs.5000
  2. If filed before 31st March - Rs. 10,000

Income Tax Return – ITR - 6 Form Filing

When should ITR-6 be filed?

ITR-6 form is to be used when the taxpayer is registered as a Company under Indian Companies Act of 1956 or any other law, and if the company is not claiming exemption under section 11 (Income from property held for charitable or religious purposes).

Who should not file ITR-6?

Individuals, Hindu Undivided Family (HUF), Firm, Association of Person (AOP), Body of Individuals (BOI), Local Authority and Artificial Judiciary Person

What is the due date for filing ITR- 6?

The due date for ITR-6 filing is September 30th.

What is the penalty for late filing of ITR-6?

  1. If filed before 31st December- Rs.5000
  2. If filed before 31st March - Rs. 10,000

Income Tax Return – ITR - 7 Form filling

When should ITR-7 be filed?

ITR-7 form is to be used when the tax assessee is a

  1. Trust,
  2. Company
  3. Firm
  4. Local authority
  5. Association of Person (AOP) or Artificial Judiciary Person

and is claiming exemption under Section 139 (4A), Section 139 (4B), Section 139 (4C)or Section 139 (4D)

Who should not file ITR-7?

ITR7 cannot be used by a tax assessee who is not claiming exemption under Section 139 (4A), Section 139 (4B), Section 139 (4C) or Section 139 (4D).

What is the due date for filing ITR- 7?

Due Date for all Tax Assessees, whose accounts are required to be audited, is 30th September. Due Date for Tax Assessees, whose accounts are not required to be audited, is 31st July.

What is the penalty for late filing of ITR-7?

  1. If filed before 31st December- Rs.5000
  2. If filed before 31st March - Rs. 10,000

Income Tax Notices

What is Income Tax Notice?

It is a written communication sent by Income Tax Department to the tax payer alerting an issue with respect to his tax account. A notice can be sent for many reasons like filing / non-filing of Income Tax returns, defective returns, for the purpose of making an assessment, asking certain details etc. When a notice is sent by the department the taxpayer has to act on the notice within the stipulated time and has to get the matter resolved with the tax authorities. if any scrutiny arises, provide all the relevant details or documents on time that the department seeks from you to verify the necessary details.

Taxpayers, in general, are issued income tax notices under Section 139(9), 143(1), 143(2), 143(3), 245, 144, 147 and 148 of Income Tax Act, 1961 regarding non-filing of ITR, concealment of taxable income, claiming an in genuine tax refund, computing excessive tax losses, long term capital gains (LTCG), scrutiny etc."

Kireeti Consultants has a team of professionals comprising Chartered Accountants, Company Secretaries and other professionals provide a comprehensive service in filing Income tax returns for individuals, HUF, firms and corporates and help them in complying with tax compliances. Any income tax notice is received by you, please send us the copy of the notice/order to info@kireeticonsultants.com together with your queries.  Our Tax-experts will respond to you with a reply to the notice and query and also help you in filing the reply to the tax notice or order received by you.

Types of notices :-

  • Notice u/s 139(9): If the AO believes that a defective income tax return is filed, he would serve you notice under this section. The error can be missing information, use of the wrong ITR form, incomplete return, etc. The officer would also highlight the defect in the income tax return and recommend the solution thereof. You get a period of 15 days to respond to the notice. If you do not respond, your ITR would be rejected.
  • Notice u/s 142(1) : This notice is served by the assessing officer u/s 142 (1) in two cases.  Firstly, if the officer requires additional information and documents pertaining to your income tax returns. Secondly, if the return is not filed, but the officer wants the return to be filed. If you do not respond to the notice served under Section 142(1), you would face a penalty of INR 10,000, prosecution for up to 1 year or both.
  • Intimation u/s 143(1): On filing of income tax returns, a notice cum intimation is sent u/s 413(I) of the Income Tax Act 1961. It is not always necessary to respond against this notice, as in most cases it’s just an intimation stating that the return has been successfully processed. However, sometimes the department can send, routine notices in the nature of providing information on calculation errors, mismatch of income declared in return and as appearing in Form 26AS etc. It contains information related to an additional tax liability or refund or if the loss amount mentioned in the return should be increased or decreased or if filed return is perfect.
  • Notice u/s 143(2): A notice u/s 143(2) is sent to the taxpayer if the Tax Department chooses to scrutinize the ITR of the taxpayer. The assessing officer sends this notice within 6 months from the end of the financial year in which the return is furnished. After the notice is received by the taxpayer, he/she should reply to the questionnaire issued by the income tax department and submit all the additional documents requested
  • Notice u/s 148: This notice is sent in cases where the assessing officer (AO) has a reason to believe that a taxpayer has filed his ITR on a lower income or not filed when he was mandated by the law. The time limit to send the notice under this section depends on the amount and nature of income escaped.
  • Notice u/s 131(1A): If the assessing officer believes that the tax-payer is concealing his income or a part thereof, he can serve a notice under this section. Through the notice, the assessing officer can enquire the books of accounts of the taxpayer and investigate into the taxpayer’s income. There is no specific time limit to issue this notice.
  • Notice u/s 156: If there is any type of demand like penalty, fine, tax or any other amount which the taxpayer is supposed to pay to the income tax department, a notice under Section 156 would be issued. This notice is also called the notice of demand and the taxpayer should pay the due amount within 30 days of receiving the notice.
  • Notice u/s 245: This notice is served by the assessing officer(AO) if it is believed that you have not paid taxes in the previous FY where you had a tax liability and the tax refund of the current FY can be used to pay off the tax liability. You are required to respond within 30 days, failing which, the AO would consider it as consent to adjust the tax refund with previous tax liabilities and then issue your refunds after such adjustments.

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