By Parizad Sirwalla

Income Tax Return FY 2023-24: The process of filing income tax returns (ITR) in India has become technology-centric. This article offers a high-level insight into filing personal income tax for financial year (FY) 2023-24, outlining the eligibility requirements and documents required.

Who should file ITR?

Individuals need to file returns only if their total income in a tax year FY (April to March) exceeds the basic exemption limit, namely if you opt for the old tax regime – Rs 2.50 Lacs (if you are below 60 years of age or a non-resident), Rs 3 Lacs (if you are 60 years or above but below 80 years of age) or Rs 5 Lacs (if you are 80 years or above). If you opt for the standard new tax regime, the basic exemption limit is Rs 3 Lacs.

There are additional conditions that require an individual to file an ITR even if the income falls within the basic exemption limit. The illustrative list is:

1. Resident or ordinarily resident (ROR) person holding foreign assets or having signing authority over a foreign account.
2. Deposit a total of Rs 1 Crore or more in one or more current bank account(s) or Rs 50 lakhs or more in one or more savings account(s)
3. Expenses of Rs 2 Lacs or more on foreign travel (for yourself or any other person)
4. Spending Rs 1 Lac or more on electricity bills
5. Taxes withheld/collected at source (TDS/TCS) is Rs 25,000 or more (Rs 50,000 for senior citizens)

Also, in case there is a TDS/TCS, and you do not have an ITR filing requirement, you will have to file the ITR to claim a tax refund. Similarly, if you have to claim a loss that has to be carried forward to future years, you may have to file an ITR.

Also Read | Income Tax Expectations Budget 2024: Tax-free limit on savings account interest increased to Rs 25,000?

Illustrative myths

Myth: ITR is not required if only interest income from banks and/or TDS has already been deducted.

Fact: If any of the defined ITR filing conditions are fulfilled, ITR is required to be filed even if you have received only interest income and/or TDS has already been deducted. There is relief only in case of certain senior citizens having pension income and bank interest income, subject to fulfillment of certain conditions.

Myth: I am a ROR with income less than Rs 2.5 Lacs (and no TDS/loss) and have invested in foreign stocks. I don’t have to file ITR.

Fact: Filing an ITR application is mandatory as you have assets outside India.

Myth: Donations are completely tax free

Fact: Gifts can also be taxed if money is received from non-relatives worth more than Rs 50,000

Also Read | Form 16 for ITR Filing: Key Points to Check in Form 16 Before Filing Your Income Tax Return for FY 2023-24

ITR application: what documents should you have at hand?

Below you will find an illustrative checklist that can help you submit your application:

• PAN and Aadhaar: Linking these two is mandatory (except for notified exclusions).
• Form 16: Issued by employers, containing details of salary paid and corresponding TDS
• Form 16A/16B/16C: Income and TDS details on income other than salary
• Form 26AS: Consolidated Annual Tax Deduction/Income Statement Reflected in Income Tax Records
• Annual Information Statement (AIS) and Taxpayer Information Statement (TIS):

These statements provide a comprehensive view of information as filed by various reporting entities (banks, investment brokers, etc.) and reflected in income tax data. The IRS has also launched a mobile app, “AIS for Taxpayers,” to download these forms.

• Bank statements: To report interest income and verify other financial transactions.
• Investment Certificates: Documents supporting deductions under Sections 80C, 80D, 80G, etc.
• Mortgage overview: For claiming interest and repayment benefits.

Which ITR form should I file?

It is also important to file ITRs in proper form. For example, if you are a resident (without foreign assets) with salary, pension, family house, interest and total income less than Rs 50 lacs, you need to file ITR-1 (SAHAJ). ITR-2 can be filed by persons who are not covered under ITR-1 and who do not have business/professional income.

What are the consequences if you file your tax return too late?

The filing deadline for FY 2023-24 is July 31, 2024 (for non-tax audit cases). Some of the consequences of late filing are:

• Additional interest obligation due to delay
• Compensation of Rs 1,000/Rs 5,000 (based on income)
• Transfer of business or capital losses is not permitted
• The option not to participate in the new tax system will no longer apply.

Also Read | Filing Income Tax Return: Is it Mandatory to File ITR if Income is Not More Than Rs 7 Lakh?

Conclusion
Early riser catches evil: do not wait until the last minute to file your ITR, to avoid problems or correct errors.

A watchful eye: Seek professional help if your income profile is complex or if you have any doubts.

Finalize: Ensure your ITR is successfully verified within 30 days of electronically filing it.

(The author is National Leader, Global Mobility Services – Tax, KPMG in India)

Filing Income Tax Return for FY 2023-24? Top Documents Salarypayers Must Check