This blog is meant for use by members of the Association for news and views. Send comments / suggestions / views to e-mail Id: aiaipasp.ors@gmail.com

Sunday, June 3, 2018

10 documents you need to file your income tax return


The time has come for all of us to start filing our income tax returns. This year it becomes all the more important to file it on time as there is a penalty for missing the deadline. 

To make the process of filing your returns easier, it is always better to keep all the necessary documentary proof ready and handy. Without it, filing your return could be difficult. 

This year, the income tax department has asked taxpayers who file using ITR1 to provide break-up of the gross salary income and income earned from one house property during the FY 2017-18. This is why chartered accountants advise that you must collect all the documents related to income earned during the financial year to ensure that there are no mistakes made while filing ITR. 

Here are the 10 documents you must keep in handy while filing your ITR for FY 2017-18: 


1. Form-16 
If you are a salaried person, this is one of the most important documents for you to file your ITR. Abhishek Soni, CEO, tax2win.in, a tax-filing company, says "Form-16 is a TDS certificate issued to you by your employer to provide details of the salary paid to you and TDS deducted on it, if any. It is mandatory for your employer to issue Form-16 if your employer has deducted TDS from your salary. If no TDS is deducted from your salary, then you can request your employer to provide you the same." 

This year, ITR form-1 requires salaried taxpayers to provide the salary break-up, having Form-16 makes it easier to get that information 

Form-16 consists of two parts: Part-A and Part-B. Part-A consists of all the details of the tax deducted by your employer during the year. Apart from details of the tax deducted from your salary, it also consists of the details of your Permanent Account Number (PAN), PAN and TAN of your employer whereas Part-B of the form consists of your gross salary break-up details such as exempt allowances, perquisites etc. Soni adds, "Details like perquisites, profit in lieu of salary which is taxable in your hands can be found in Part-B Form-16." 

While receiving Form-16, one must check that the PAN mentioned on it is yours. If there is any discrepancy, then you must bring this to your employer's notice. Your employer will rectify the mistakes in Form-16 and issue you a revised form. 

2. Salary slips 
Apart from perquisites and profit in lieu of salary, salaried taxpayers are also required to provide information of allowances such as house rent allowance, transport allowance etc. that are taxable. 

You can find these details in your salary slips. From the salary slips, you can add each allowance received during the year and then calculate the taxability portion of it. If you have received HRA in the last FY and paid rent, then the taxable portion of that will be calculated based on certain conditions. Click here to use our HRA calculator and compute taxable amount. 

Further, the tax treatment of each allowance received by you has a different tax treatment - some allowances will be fully taxable, while some are partially taxed. You can find all of this information in your salary slips. 

Special allowance received during the last FY will be fully taxable in your hands. Transport allowance received during FY 2017-18 will be tax-exempt for maximum up to Rs 19,200 in a year. However, from FY 2018-19, standard deduction of Rs 40,000 will be available in lieu of transport allowance and medical reimbursement. 

3. Interest certificates from banks and post office 
Interest received from savings bank account, post office savings account, fixed deposits and recurring deposits are taxable. Therefore, one must either get the interest certificates from the bank/s and/or post office branch to know the total interest earned, in case no TDS has been deducted. 

If you do not get interest certificates, make sure your account passbook is updated and shows details regarding the interest credited to your account till March 31, 2018. 

4. Form-16A/Form-16B/Form-16C 
If TDS deducted on the payments other than salaries such as interest received from fixed deposits, recurring deposits etc. over the specified limits as per the current tax laws, your bank (in this case) will issue you Form-16A providing you the details of the amount of TDS deducted. 

On the other hand, if you have sold your property, then the buyer will issue you Form-16B showing the TDS deducted on the amount paid to you. 

5. Form 26AS 
Form 26AS is your consolidated annual tax statement. This is like your tax passbook which has information of all the taxes that has been deposited against your PAN. These include: 
a) TDS deducted by your employer, 
b) TDS deducted by banks if the interest income in FY 2017-18 exceeds Rs 10,000, 
c) TDS deducted by any other organisation for the payments that have been made to you, 
d) Advance taxes deposited by yourself during the FY 2017-18, 
 e) Self-assessment taxes paid by you. 

One can download Form 26AS from the TRACES website. To download your Form-26AS, you can login to your account on the e-filing website, www.incometaxindiaefiling.gov.in. Once logged in, click on 'View 26AS (Tax Credit)' under the 'My Account' tab. The website will redirect you to the TRACES website to download the form. 

You should ensure that all the taxes deducted in FY 2017-18 are reflecting against your PAN in Form-26AS. In case of mismatch you should ask the deductor to rectify the mistake. If the mismatch is not corrected, you won't be able to claim tax-credit for that TDS deduction. 

6. Tax-saving investment proofs 
All the tax-saving investments and expenditures incurred by you under section 80C, 80CCC and 80CCD(1) during FY2017-18 can help you lower your tax liability. The maximum tax-break you can claim under these three sections cannot exceed Rs 1.5 lakh in a financial year. 
The most common available tax breaks under section 80C are as follows: 
a) Employees Provident Fund (EPF) 
b) Public Provident Fund (PPF) 
c) Investments in ELSS schemes of mutual funds 
d) Life insurance premium paid 
e) National Pension System (NPS) etc. 

Apart from investments, there are certain expenditures that are also eligible for tax-benefits under section 80C. Examples of these expenditures include home loan principal repayment, tuition fees paid for your children etc. Click here to know all expenditures that can help you save tax under section 80C. 

7. Deductions under section 80D to 80U 
Apart from tax-saving investments and expenditures under section 80C, there are certain expenses on which you can claim deductions under different sections of the Income-tax Act. For instance, health insurance premium paid in the FY 2017-18 is eligible for deduction under section 80D of the Act for maximum up to Rs 25,000 in a year. 

8. Home loan statement from bank/NBFC 
If you have taken a home loan from a bank or any other financial institution, don't forget to collect the loan statement. It will provide you the break-up details of how much principal and interest has been repaid by you. 

9. Capital gains 
If you have earned some capital gains from the sale of property and/ or mutual funds, then you will be required to report these gains in your ITR. 

10. Aadhaar card 
Providing Aadhaar details is mandatory to successfully file your ITR. According to section 139AA of the Income-tax Act, an individual is required to provide his/her Aadhaar details while filing the return of your income. 

If you have not received your Aadhaar card yet but have applied for it, then you would be required to provide an enrolment ID in your tax returns. 

Source:-The Times of India

No comments: