Income Tax Return Filing
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Questions and Answers

What is the purpose of a return of income?

To furnish information regarding total income and tax payable

Who is required to compulsorily file a return of income?

  • Companies and firms only
  • Individuals whose total income exceeds the basic exemption limit
  • Residents holding assets outside India
  • All of the above (correct)
  • The basic exemption limit for individuals under the default tax regime is ₹3,00,000.

    True

    The due date for filing a return of income is usually on or before the _____ in the prescribed form.

    <p>due date</p> Signup and view all the answers

    Match the following provisions with their descriptions:

    <p>Belated Return = Filing return after the due date Revised Return = Correcting errors in the original return Updated Return = Filing a return with new information Self-Assessment = Paying tax before filing the return</p> Signup and view all the answers

    When is the due date for filing the return of income for an assessee who is a partner of a firm?

    <p>Three months prior to the end of the Relevant Assessment Year</p> Signup and view all the answers

    Interest under section 234A is charged for failure to file a return of income after the due date under section 139(1).

    <p>True</p> Signup and view all the answers

    Under what circumstances is interest under section 234A payable?

    <p>When an assessee furnishes the return of income after the due date or does not furnish the return of income.</p> Signup and view all the answers

    Under what conditions does a person need to file their return of income as per Rule 12AB?

    <p>If their total sales, turnover or gross receipts in business is &gt; <code>60 lakhs, or if their total gross receipts in profession is &amp;gt;</code> 10 lakhs, or if the aggregate of TDS and TCS is ` 25,000 or more.</p> Signup and view all the answers

    What does 'due date' refer to in income tax law?

    <p>It refers to the deadline by which an assessee must file their return of income.</p> Signup and view all the answers

    When is the extended due date for filing return of income as per Section 139(1)?

    <p>30th November of the assessment year for assessees who need to file a transfer pricing report under section 92E.</p> Signup and view all the answers

    True or False: An individual is required to furnish a return of income under section 139(1) if their total income exceeds the maximum amount not chargeable to tax.

    <p>True</p> Signup and view all the answers

    Which section requires mandatory filing of return of loss for specific types of losses?

    <p>Section 139(3)</p> Signup and view all the answers

    When will additional income-tax be 25% of the aggregate of tax and interest payable?

    <p>If such return is furnished after expiry of the time available under section 139(4) or 139(5) of the assessment year and before completion of the period of 12 months from the end of the relevant assessment year.</p> Signup and view all the answers

    When will additional income-tax be 50% of the aggregate of tax and interest payable?

    <p>If such return is furnished after the expiry of 12 months from the end of the relevant assessment year but before completion of the period of 24 months from the end of the relevant assessment year.</p> Signup and view all the answers

    When does a return of income become regarded as defective?

    <p>If the return is not accompanied by proof of payment of taxes</p> Signup and view all the answers

    Quoting of PAN is mandatory in all documents pertaining to certain transactions.

    <p>True</p> Signup and view all the answers

    What is the consequence if an assessee fails to pay the whole or any part of tax, interest, or fee?

    <p>The assessee will be deemed to be an assessee in default and all provisions of the Act will apply accordingly.</p> Signup and view all the answers

    What is the time frame within which an updated return of income can be furnished?

    <p>Within 24 months from the end of the relevant assessment year.</p> Signup and view all the answers

    If the updated return results in a refund or increases the refund due, the provisions of updated return will not apply. True or False?

    <p>True</p> Signup and view all the answers

    What are the circumstances in which an updated return cannot be furnished?

    <p>All of the above.</p> Signup and view all the answers

    What is the maximum amount allowed for payment in cash at a hotel or restaurant against a bill?

    <p>50,000</p> Signup and view all the answers

    Which of the following transactions require payment not to exceed `50,000 at any one time? (Select all that apply)

    <p>Payment to a Mutual Fund for purchase of its units</p> Signup and view all the answers

    A time deposit with a banking company or a co-operative bank must not exceed __ during any financial year.

    <p>5 lakh</p> Signup and view all the answers

    Every person receiving a document related to specified transactions must ensure the PAN or Aadhaar number is quoted.

    <p>True</p> Signup and view all the answers

    According to Section 139AA, who is required to mandatorily quote Aadhaar Number?

    <p>Anyone eligible to obtain Aadhaar Number</p> Signup and view all the answers

    As per the provisions of section 139AA, the PAN of a person shall become inoperative if they fail to intimate their Aadhaar number by 31st March, 2022.

    <p>True</p> Signup and view all the answers

    Explain the consequences of failure to intimate Aadhaar Number as per the content provided.

    <p>If a person fails to intimate their Aadhaar Number, the PAN allotted to them will be made inoperative after the specified date.</p> Signup and view all the answers

    In what circumstances can an individual authorize another person to file their income tax return on their behalf?

    <p>All of the above</p> Signup and view all the answers

    Who can file the income tax return on behalf of a Hindu Undivided Family if the karta is mentally incapacitated?

    <p>any other adult member of the HUF</p> Signup and view all the answers

    A company being wound up can have its return verified by a liquidator.

    <p>True</p> Signup and view all the answers

    In which circumstances can a firm authorize any partner to verify the return? When for any unavoidable reason such managing partner is not able to verify the return, or where there is no ________ partner.

    <p>managing</p> Signup and view all the answers

    What are the consequences faced by a person whose PAN has become inoperative?

    <p>No refund of tax, higher TDS, higher TCS, no interest on refund</p> Signup and view all the answers

    What is the fee amount if the Aadhaar number was intimated on or before 30.06.2022?

    <p>Rs. 500</p> Signup and view all the answers

    Provisions of section 139AA relating to quoting of Aadhaar Number do not apply to individuals residing in Assam, Jammu & Kashmir, and Meghalaya.

    <p>True</p> Signup and view all the answers

    Who is not authorized to act as a Tax Return Preparer?

    <p>Legal practitioners</p> Signup and view all the answers

    Match the following qualifications for Tax Return Preparers:

    <p>Bachelor degree from recognized Indian University = Educational qualification Tax Return Preparer Certificate &amp; unique identification number = Eligible person Income tax return preparation = Duties and obligations Scheme for submission of returns = Scheme details</p> Signup and view all the answers

    Study Notes

    Provisions for Filing Return of Income and Self-Assessment

    Chapter Overview

    • The chapter deals with the provisions of filing return of income and self-assessment.
    • It covers various aspects such as compulsory filing of return of income, due date for filing, interest and fee for default, and revised and updated returns.

    Return of Income

    • A return of income is a format in which an assessee furnishes information about their total income and tax payable.
    • The format for filing returns is notified by the Central Board of Direct Taxes (CBDT).
    • A return of income typically includes particulars of income earned under different heads, gross total income, deductions, and tax payable.

    Compulsory Filing of Return of Income [Section 139(1)]

    • Companies and firms are required to file a return of income or loss for every previous year.
    • Individuals, HUFs, AOPs, and BOIs with a total income exceeding the basic exemption limit are required to file a return of income.
    • The basic exemption limit is ₹3,00,000 for individuals, HUFs, AOPs, and BOIs under the default tax regime.
    • However, if the assessee exercises the option of shifting out of the default tax regime, the basic exemption limit would be ₹2,50,000.
    • Residents with a total income exceeding the basic exemption limit are required to file a return of income, even if they are not ordinarily resident in India.
    • Beneficial owners and beneficiaries of assets located outside India are also required to file a return of income.

    Due Date for Filing Return of Income

    • The due date for filing a return of income is 31st October of the assessment year for companies, persons with audited accounts, and partners of firms with audited accounts.
    • The due date is 30th November of the assessment year for assessees who have to file a transfer pricing report.
    • The due date is 31st July of the assessment year for other assessees.

    Specified Class or Classes of Persons to be Exempted from Filing Return of Income [Section 139(1C)]

    • The Central Government has the power to notify the class or classes of persons who will be exempted from filing a return of income, subject to satisfying prescribed conditions.

    Return of Loss [Section 139(3)]

    • An assessee is required to file a return of loss in the same manner as a return of income within the time allowed under Section 139(1).
    • A return of loss is required to be filed even if the assessee is not mandatorily required to file a return of income.### Filing Return of Income
    • Mandatory filing of return of income under Section 139(1) applies to:
      • Residents having any asset located outside India
      • Individuals/HUFs/AOPs/BOIs with total income exceeding the basic exemption limit
      • Persons with total sales/turnover/gross receipts > ₹60 lakhs in business
      • Persons with total gross receipts > ₹10 lakhs in profession
      • Persons with aggregate TDS and TCS credit ≥ ₹25,000 (₹50,000 for senior citizens)
      • Persons with deposit in one or more savings bank accounts ≥ ₹50 lakhs

    Due Date of Filing Return

    • 30th November of the assessment year for assessees required to furnish a report under Section 92E
    • 31st October of the assessment year for companies and persons whose accounts are required to be audited
    • 31st July of the assessment year for any other assessee

    Loss Return

    • Mandatory filing of return of loss under Section 139(3) is required for carry forward of losses under:
      • Section 72(1) (business loss)
      • Section 73(2) (speculation business loss)
      • Section 73A(2) (loss from specified business)
      • Section 74(1) (loss under the head "Capital Gains")
      • Section 74A(3) (loss from the activity of owning and maintaining race horses)

    Belated Return

    • Can be filed under Section 139(4) if return not filed within the time specified under Section 139(1)
    • Can be filed at any time before:
      • Three months prior to the end of the relevant assessment year
      • Completion of the assessment

    Revised Return

    • Can be filed under Section 139(5) if any omission or wrong statement is discovered in the original return
    • Can be filed at any time before:
      • Three months prior to the end of the relevant assessment year
      • Completion of the assessment

    Interest for Default in Furnishing Return of Income

    • Attracted under Section 234A for failure to file return of income on or before the due date under Section 139(1)
    • Interest is payable at 1% per month or part of the month from the date immediately following the due date
    • Interest is to be calculated on the amount of tax on total income as determined under Section 143(1) or regular assessment

    Self-Assessment

    • Payment of tax, interest, and fee is required before furnishing the return of income
    • Payment is to be made after taking into account:
      • Advance tax paid
      • Tax deducted or collected at source
      • Relief of tax claimed under Section 89
      • Tax credit claimed to be set-off in accordance with Section 115JD

    Updated Return of Income

    • Can be filed under Section 139(8A) at any time within 24 months from the end of the relevant assessment year
    • Not applicable if:
      • The updated return is a loss return
      • The updated return has the effect of decreasing the total tax liability
      • The updated return results in a refund or increases the refund due
    • Can be filed if the original return is a loss return and the updated return is a return of income### Tax on Updated Return [Section 140B]
    • Payment of tax, additional tax, interest, and fee before furnishing updated return of income
      • In case no return is furnished earlier (Section 140B(1)):
        • Tax to be paid along with interest and fee before furnishing updated return
        • The updated return shall be accompanied by proof of payment of such tax, additional income-tax, interest, and fee
      • In case a return is furnished earlier (Section 140B(2)):
        • Tax to be paid along with interest before furnishing updated return
        • The updated return shall be accompanied by proof of payment of such tax, additional income-tax, and interest

    Manner of computation of tax payable on the basis of updated return

    • In case no return is furnished earlier (Section 140B(1)):
      • Tax payable is to be computed after taking into account:
        • The amount of tax, if any, already paid as advance tax
        • The tax deducted or collected at source
        • Any relief of tax claimed under Section 89
        • Any tax credit claimed to set-off in accordance with Section 115JD
    • In case a return is furnished earlier (Section 140B(2)):
      • Tax payable is to be computed after taking into account:
        • The amount of relief or tax referred to in Section 140A(1), the credit for which has been taken in the earlier return
        • The tax deducted or collected at source on any income which is subject to such deduction or collection
        • Any tax credit claimed to set-off in accordance with Section 115JD

    Interest under Section 234A, 234B, and 234C

    • In case no return is furnished earlier (Section 140B(1)):
      • Interest payable under Section 234A has to be computed on the amount of tax on the total income as declared in the updated return
    • In case a return is furnished earlier (Section 140B(2)):
      • Interest payable under Section 234B has to be computed on the assessed tax
      • Interest payable under Section 234C has to be computed after taking into account the total income furnished in the updated return

    Additional income-tax payable at the time of updated return [Section 140B(3)]

    • The additional income-tax payable at the time of furnishing the updated return under Section 139(8A) would be:
      • 25% of the aggregate of tax and interest payable if the return is furnished after the expiry of the time available under Section 139(4) or 139(5) and before the completion of the period of 12 months from the end of the relevant assessment year
      • 50% of the aggregate of tax and interest payable if the return is furnished after the expiry of 12 months from the end of the relevant assessment year

    Defective Return [Section 139(9)]

    • The Assessing Officer has the power to call upon the assessee to rectify a defective return
    • A return of income would be regarded as defective unless:
      • The annexures, statements, and columns have been duly filled in
      • The return is accompanied by proof of payment of taxes

    Fee for Default in Furnishing Return of Income [Section 234F]

    • A person who fails to furnish a return of income under Section 139 within the prescribed time limit shall pay, by way of fee, a sum of ` 5,000
    • However, if the total income of the person does not exceed 5 lakhs, the fee payable shall not exceed 1,000

    Permanent Account Number (PAN) [Section 139A]

    • The following persons are required to apply for a PAN:
      • Every person who has not been allotted a PAN and intends to enter into certain transactions
      • Every person who is required to furnish a return of income under Section 139
    • The Assessing Officer shall allot a PAN to the person within the prescribed time
    • Quoting of PAN is mandatory in all documents pertaining to certain prescribed transactions

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    Description

    This quiz covers the basics of income tax returns in India, including the purpose, compulsory filing, exemption limit, and due dates. Test your knowledge of income tax return filing in India.

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