Scheme of Income Tax Return in India
Income Tax Return in India
Income
Tax Return in India
India is a one of the
fastest growing economies of the world and requires lot of funding for meeting
its infrastructure development, defense and other social development
requirement. Direct taxes and indirect taxes are major sources of revenue of
Indian Government and Income Tax Return in India
is
one of the means through which collection of direct taxes are monitored by the
government for meeting its various development requirement.
Who
are required to File Income Tax Return in India?
As per the domestic law in
India, every person who has taxable income in excess of basic exemption limits
are required to file Income Tax Return in India. Also, the
present basic exemption limit is Rs.2.5 lac. Further, besides aforesaid income
criteria, certain people are also required to file their Income Tax Return in
India although their income has not exceeded the basic exemption limit as
mentioned above like in case of electricity consumption of more than Rs.1 lac
or in case of foreign tours undertaken during the year.
Whether
Nonresident Indians are also required to file Income Tax Return in India?
Yes, even the Non Resident
Indians are required to file their Income tax return in India in case they have
taxable income in India. It may be noted that unlike residents, who need to
file their income tax return relating to global income i.e. whether income
earned in India or abroad, in case of Nonresidents, only income earned in India
are taxable and not the income earned outside India.
What
is the composition of Income Tax Return in India?
Income tax return or ITR
generally comprises of details of incomes earned under various heads of income
by any person whether an individual or a company.
Normally, in India, the
following types of incomes are required to be reported:
a) Income from Salaries
b) Income from House property
c) Income from capital gains
d) Income from Business and
Profession
e) Income from Other sources
What
are the tax rates applicable for different types of persons?
Normally, different types
of tax rates are prescribed for different types of persons in India like
1) An individual or HUF is
taxed at 5% to 30% depending upon amount of income earned during the year.
2) Domestic companies are
taxed at 15%/22% and 25% depending upon nature of business and options chosen
by them.
3) Limited Liability
Partnerships are taxed at 30%
4) Foreign companies are taxed
at 40%
5) AOP/NGOs etc. are taxed at
30%
Besides above, education
cess @ 4% and surcharge at different rates are also applicable on total tax
computed as above.
It may be noted that filing
of Income Tax
Return in India is
a complex procedure for each type of tax assesses and involves interpretation
of various provisions of income tax act in India, accordingly, it is advisable
to take assistance of some tax experts who will guide in professional manner
and ensure that you have a hassle free experience of tax return filing in India
and to avoid unnecessary notices and inquiries from the tax department.
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