Tax Returns in India apply for all individuals whose income falls within the tax slabs of the central government published every year in the annual budget. However, tax returns in India also apply to telephone subscribers, property owners, credit card holders, and motor vehicle owners.
Forms for Tax Returns in India:
The government of India issues various forms to facilitate tax returns in India. For example, Form 2D, which is better known as the Saral Form, is issued for assessment of individuals who are employed in the corporate sector but do not include people who are entitled to tax exemption as per Section 11 of the Income Tax Act,1961. Again, for people who ask for exemptions as per Section 11 of the Income Tax Act, 1961 and run their own business, need to fill up Form 2. Form 16AA is issued for the individuals whose income from salary is subjected to tax deducted at source.
Form 2B is to be filled up during block period occurring on account of seizure cases. Form 60 is a special form for individuals who do not have PAN/GIR and make cash down payment in buying vehicles, buying securities of more than Rs.10,00,000, for a opening a bank account, and bill payment of Rs. 25,000 and more for hotels and restaurants. Form 2E is to be filled up by the members of the Hindu Undivided Family who do not run any business or earn through agricultural activities are entitled to capital gains and Form 46A is required to be filled for getting the Permanent Account Number as per Section 139A of the Income Tax Act,1961.
Verification of Tax Returns in India:
The most essential aspect with respect to tax returns in India is that the income tax return form has to be verified by the person who meets the requirements of Section 140 of the Income Tax Act, 1961. The tax return forms of different organizations need to be signed by different authorities. For example, the tax returns of big, medium, as well as small sized companies need to be signed and verified by the managing director of that specific company and in the absence of the managing director, all the directors are authorized to sign the return form. In case the company is undergoing a wind-up procedure, the tax return needs to be signed by the liquidator and in case the specific company is a government undertaking, the tax return form is required to be verified by the officer who has been appointed by the central government for the concerned purpose. In case the company is a non-resident one, the verification work will be done by the person possessing the Power of Attorney required for the purpose.
When the tax return is filed by a political party, the chief executive officer as well as the secretary is entitled to verify the tax returns. The authorized signatory for firms remains the same as the companies i.e., the managing director of a firm is entitled to verify the tax return and in his absence, the partners are provided with the authority to verify the tax return. In case of an association, the tax return can either be verified by the chief executive officer or any other member of the specific association.
Tax Filing for Tax Returns in India:
In India, the financial year ends on 31st March every year and the central government allows approximately 4 months more after the end of the financial year - 31st of July, to submit the tax returns for that year. Firms that need to get their books of accounts audited as per the Income Tax Act, 1961 are allowed to submit their tax returns by 31st October. Documents required for tax return filing include Form 16 in case of salaried persons. This form contains an account of the individual's income from salary and the exact deductions made from the salary for the purpose of tax payment. Individuals who enjoy interest income through banks deposits and investment in securities will have to fill Form 16A. Bank statements covering all the incomes and expenditures of a firm or an individual and in the event that the tax payer has purchased any property or taken a loan against that property then loan details together with the certificate of interest is required to be furnished for filing of tax return.
Result of not filing tax returns in India:
In case the tax payer is not able to file his tax return on time, he is subjected to certain penalties. For example, s/he will be required to pay an interest of 1% for each month of delay. In the event the tax payer files his tax return after the year end of the next year, he will be charged Rs. 5,000 together with the 1% interest for each month of delay.
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