CALCULATION of income tax , ITR Forms & DEDUCTIONS

Many taxpayers are worried about their taxes, refunds, filing of returns ( ITR forms) and the most important aspect is calculation of  income tax so that no future correction statements need to be filed with the Income Tax Department and one can avoid the extra consultancy charges to be paid to the outsiders.

From this year, the Income Tax Department has made quite simpler the process of Filling of the Income Tax Return and simultaneously the calculation of the Correct Income Tax Payable/Refund. All the major aspects regarding the Income Tax Calculation & Income Tax Calculation have been discussed below in points for the ease of the taxpayer.

1. Calculation of Income Tax as per Tax Slab

One should be very much aware about the tax slabs in accordance which the income of the tax payer is being taxed. The slab rate for the FY 2014-15/AY 2015-16 have been announced with some changes in the last Budget by the Honourable Finance Minister. The Slab Rates are as follows:

For General Taxpayers & Individual

Calculation of income Tax: If you fall in Slab I, tax will be deducted on the amount that exceeds Rs. 2, 50,001/-. Similarly, tax for Slab II and Slab III will be calculated for the amount that exceeds Rs. 5,00,001 and Rs. 10,00,000/- respectively. The same principle also applies to tax slab for senior and super senior citizens as given below:

For Senior Citizens (Aged 60 Years but less than 80 Years)

For Super Senior Citizens (Aged 80 Years & Above)

Therefore, one should be aware of the slab limit and should carefully identify the slab in which the taxpayer comes and calculation of income tax works accordingly. You can also use Income tax calculator provided by income tax department to do calculation of income tax.

2. Income Tax Return Form & Furnishing Correct Details:

The other important that need to be carefully considered by the tax payer that which ITR form applies to the taxpayer.

This year, loads of changes have been made keeping in mind the end goal to improve the Income Tax Return Forms. To control the Black Money, the department had in the earlierforms solicited citizens to outfit the points of interest from all their outside trips, including the costs brought about on those excursions. This pulled in an enormous kickback, which incited the division to change the ITR Forms once more.

Like consistently, the CBDT has thought of an obliged arrangement of structures that a citizen is required to fill while filling his/her government forms. This year loads of changes have been made with a specific end goal to improve the Income Tax Return Forms.

All the changes along-with some important dates and details to be furnished in the ITR have been discussed:

1. Last date extended to August 31: The deadline for filling returns for Financial Year 2015 has been extended to August 31 from the existing July 31.
2. Furnishing all bank account details: You have to declare all your bank account details while filling tax returns. This includes bank accounts held jointly and as a single account holder.
3. Foreign Income: all the details of any foreign income, including the details of the amount earned from foreign country and the nature of income or source country needed to be submitted.
4. New Tax Forms: CBDT had notified various changes in the Income Tax Return forms. They are as Follows:

TR-V Copy to CPC office Bangalore: Unlike earlier, you don’t need to send the ITR-V copy to the CPC office in Bangalore. This is provided you submit the Aadhaar Card Number or the 10 Digit Electronic Verification Code (EVC). The new income tax returns will also will also have a place for mentioning the Aadhaar Card Number, which is one of the four ways of verifying the identity of the Taxpayer. Those who don’t have an Aadhaar Card or want to use the EVC can still send their ITR-V to the CPC office by post.

3. Deductions mostly missed by most of the Taxpayers:

Here are few little known deductions, from specified illness to donations that tax payers tend to miss out on. Everyone is aware about the deductions available under section 80C. But there are several other deductions that a taxpayer can avail apart from general deductions.

Conclusion

The above article is solely dedicated to all the genuine taxpayers, since lots of changes have come under the Income Tax and one should be aware of such changes. Although, Income Tax Department is trying to make the process of filling of Income Tax Returns very simpler but since there are some issues or important points that once should be aware of should be kept in mind by the taxpayer.