Guidelines for ITR-2 Filing

Who can e-file ITR-2?

-Individual or Hindu Undivided Family.
-Not eligible for ITR-1.
-Having Income under the head “Profits or gains of business.

Manner of Filing ITR-2 ?

Screenshot

Reference: Income Tax e-filing website.

If you are eligible for filing ITR-1 then sign up on Trutax and file your income tax returns within few minutes: ITR-2 Filing

Trutax Filing Process.

Every individual or HUF whose total income before allowing deductions under Chapter VI-A of the Income-tax Act, exceeds the maximum amount which is not chargeable to income tax is obligated to furnish his return of income. The maximum amount not chargeable to income tax in case of different categories of individuals is as follows

How to fill the ITR-2?

PART-A (GENERAL INFORMATION)

PART-A includes the details of assessee such as Name , PAN, Address information, Contact Information and relevant information to determine the assessee’s taxprofile.

PART B- TI Computation of Total Income.

PART B-TTI-Computation of Tax Liability on Total Income.

Under this section, the below details are available. 

·         Tax computation

·         Rebate u/s 87A

·         Relief u/s 89(1), 90, 90A and 91.

·         Interest Chargeable u/s 234A, 234B, 234C

·         Summary of Tax Payments like TDS, TCS, Advance Tax and Self-Assessment Tax. 

·         Net Tax Payable or Net Refund receivable.

·         Bank Account Details.

·         Resident individual or HUF has to select whether during the previous year they (i) hold, as beneficial owner, beneficiary or otherwise, any asset (including financial interest in any entity) located outside India or (ii) have signing authority in any account located outside India or (iii) have income from any source outside India?

·         Verification.

Schedule IT, TDS, TCS

Schedule-S:

·         Fill the details of salary as given in TDS certificate(s) i.e., Form 16 issued by the employer(s). 

·         In case there was more than one employer during the year, please furnish the separate details with respect to each salary received from different employers.

Schedule-HP:

·         This schedule is to be filled if you have a rental income. 

·         If there are more than two house properties, fill out the details for each property byØ selecting “Add Property” button. 

·         In case, a single house property is owned by the assessee, which is self-occupied andØ interest paid on the loan taken for the house property is to be claimed as a deduction then also this schedule shall be filled to claim deduction. 

·         In case the property is co-owned then the assessee needs to furnish the name of the co-owner, PAN and percentage of share of the other co-owner (s) in the property. In case of part ownership of property, the figure of annual value or rent receivable/received should be for whole of the property and only after computation of annual value the portion chargeable in own hands should be computed by multiplying such annual value with assessee’s percentage share in the property.

Schedule-IF:

This Schedule is to be filled if you are a partner in a firm. The below details of each firm in which you are partner are to be provided in this schedule: 

·         Name

·         PAN 

·         Whether liable for audit 

·         Whether section 92E is applicable?

·         Percentage share in the profit of the firm 

·         Amount of share in the profit.

·         Capital Balance as on 31st March in the firm.

Schedule- BP:

Capital gains are bifurcated into:

·         Short-term capital gain.

·         Long-term capital gain.

Schedule-OS:

In this schedule provide the below details: 

·         The gross income by way of dividend and interest which is not exempt.

·         Rental Income from hiring machinery, plant or furniture, building (where its letting is inseparable from the letting of the said machinery, plant or furniture), if it is not chargeable to income-tax under the head “Profits and gains of business o profession”. 

·         Any other income under the head other sources such as winning from lottery, crossword puzzles etc., income of the nature referred to in section 68, 69, 69A, 69B, 69C or 69D. The nature of such income is also required to be mentioned. 

·         Income from owning and maintaining race horses.

Schedule CYLA.

Schedule-BFLA

Schedule-CFL

Schedule- VI-A

Schedule-80G:

Mention the details of donations entitled for deduction under section 80G. Donations entitled for deductions have been divided in four categories, namely: 

·         Donations entitled for 100% deduction without qualifying limit

·         Donations entitled for 50% deduction without qualifying limit 

·         Donations entitled for 100 % deduction subject to qualifying limit

·         Donations entitled for 50% deduction subject to qualifying limit

Schedule-SPI:

Furnish the details of income of spouse, minor child, etc., if to be included in your income in accordance with provisions of Chapter V of the Income-tax Act. The income entered into this Schedule has to be included in the respective head.

Schedule-SI:

In this schedule, incomes which is chargeable to tax at special rates shall be auto-calculated from the appropriate columns in schedule BFLA/CYLA or schedule OS.

Schedule-EI:

Furnish the details of income like Agriculture Income, Interest, Dividend etc. which is exempt from tax.

Schedule-PTI:

Fill the below details from business trust or investment fund as per section 115UA, 115UB. 

·         Name of business trust or investment fund.

·         PAN of business trust or investment fund. 

·         Income from House property and TDS on such amount.

·         Income from short-term capital gain and TDS on such amount

·         Income from Long-term capital gain in column number 6 and TDS on such amount

·         Income from other sources in column number 6 and TDS on such amount

·         Income received from business trust or investment fund claimed to be exempt under section 10(23FBB), 10(23FD), etc.

Schedule FSI:

In this Schedule, fill the details of income, which is already included in total income, accruing or arising outside India.

Schedule TR:

In this schedule, fill the taxes paid outside India on the income declared in Schedule FSI which will be the total tax paid of schedule FSI in respect of each country and tax relief available which will be the total tax relief available in schedule FSI in respect of each country.

Schedule FA:

·         This schedule is to be filled up by a resident assessee and not to be filled up by a ‘not ordinarily resident’ or a ‘non-resident’. 

·         Mention the details of foreign bank accounts, financial interest in any entity, details ofØ immovable property or other assets located outside India. 

·         This should also include details of any account located outside India in which the assessee has signing authority, details of trusts created outside India in which you are settlor, beneficiary or trustee.  Under all the heads mention income generated/derived from the asset.

·         The amount of income taxable in your hands and offered in the return is to be filled out under respective columns.

·         Item G includes any other income which has been derived from any source outside India and which has not been included in the items A to F and under the head business of profession in the return.

Schedule 5A:

·         This Schedule is to be filled in case of assessee governed by Portuguese Civil Code. 

·         The share of income of the spouse should be filled in this schedule and the same shouldØ form part of the return of income of the spouse.

Schedule AL:

·         This Schedule is to be filled by individuals and HUFs giving details of properties held by the assessee and the corresponding liabilities. 

·         It is mandatory if your total income exceeds ₹50 lakh. 

·         The assets to be reported will include land, building (Immovable Assets); financial assets  viz. bank deposits, shares and securities, insurance policies, loans and advances given, cash in hand and Jewellery, bullion, vehicles, yachts, boats, aircraft etc. (Movable Assets) and interest held in the asset of a firm or association of persons (AOP) as a partner or member thereof. 

·         In the case of non-resident and resident but not ordinarily resident, the details of assets located in India are to be mentioned.

File your Income Tax Return and Get a call back from our expert for any query related to income tax filing or income tax filing assistance :  https://www.trutax.in/sign-in

Important Income Tax changes in Budget 2018

Feb 1, 2018, was the important day for every Indian taxpayer as our Hon'ble Finance Minister announced the budget 2018 and proposed many changes in personal finance. If you pay taxes then you should know about the latest income tax changes which the Government has announced in the Budget 2018.

Here is the list of important Income Tax updates announced in Budget 2018:

No changes in Income Tax Slabs for Salaried Individuals:

As everyone was expecting the change in Income Tax Slab but the government did not change the Income Tax slab for salaried employees or Individuals. Here is the income tax slab for FY 2018-19:

Hike in Cess on Income Tax from 3% to 4%:

The government has hiked the Cess on income tax from 3% education Cess to 4 % education and health Cess for all the categories of taxpayers.

Removal of Medical Reimbursement and Travel Allowance from Salary:

Budget 2018 has proposed the removal of Medical Reimbursement and Travel Allowance from the Salary. The Government has also announced the standard Deduction of Rs. 40,000 from Salary Income to employees.

10% tax on Long-Term Capital Gains:

This was the most important announcement in Budget 2018 about the Long-Term Capital Gain. The government has Introduced a 10% tax on LTCG (Long-term capital gains) if it exceeds more than Rs. 1 lakh.  Finance Minister also introduced a Dividend Distribution tax on equity oriented Mutual Funds at the rate of 10%.

Hike in Section 80D limit for Senior Citizens:

Finance Minister in Budget 2018 announced a hike in Section 80D limit to Rs. 50,000 from Current Rs. 30,000 for senior citizens.  There is also an exemption of interest income on fixed deposits and post office deposits from Rs. 10,000 to Rs.50, 000 for senior citizens.

Overall Finance Minister has introduced major changes in personal finance like long-term Capital Gain Tax, hike in Section 80D limit for Senior Citizens and exemption of interest income on fixed deposits.

Get a call back from our tax experts for any query related to Budget 2018 or Income Tax:  https://www.trutax.in/askexpert

Income Tax Deduction under Section 80C for tax saving:

There are many sections in income tax deduction under which individuals can save taxes by investing in the various tax saving options. Section 80C, Section 80D and other section 80 deductions comes under the income tax deductions where you can claim maximum deduction of up to Rs.1.5 lakh from total income.

Life Insurance Premium, ELSS, Provident Fund, Sukanya Samriddhi Yojana and PPF are some of the best tax saving investment options under section 80C.  Section 80C Deductions can be claimed by any individual or HUF for tax planning or tax saving purpose.

Section 80C Deductions

ELSS:

Equity Linked Savings Scheme (ELSS) is one of the best tax saving options which allows the maximum tax deductions of 1.5 lakh under Section 80C of the Income Tax Act. An individual can invest in ELSS with minimum lock-in period of 3 years. The returns of ELSS depends on the various market factors and risk-taking ability of investor.

Life Insurance Premium:
Life Insurance Premium provides the tax benefits and any individual can claim maximum deduction of 1.5 lakh under section 80C. The minimum lock-in period of life Insurance policy is 2 years.

EPF (Employee Provident Fund):
Any salaried employee can get tax deduction under section 80C by contributing to EPF which is a retirement benefit scheme. An employee can not withdraw the funds from the EPF if he/she is employed in company except some emergency conditions. The rate of interest is 8.65%.

PPF (Public Provident Fund):

PPF is one of the best Section 80C deductions for a long-term investment. Any salaried employee or non-salaried can choose to invest in PPF (Public Provident Fund). The maximum lock-in period of PPF is 15 years.

ULIP (Unit Linked Insurance Plan):

Any individual can claim tax deduction benefits by investing in ULIPs. An investor can invest in life insurance and stock market through ULIPs. The rate of interest in ULIPs depends on the market factors.

Sukanya Samriddhi Scheme:

Sukanya Samriddhi Scheme is the tax saving option that allows the maximum deduction of up to Rs. 1.5 lakh. The maturity period of Sukanya Samriddhi Scheme is 21 Years and Rate of interest is 8.4%.

Senior Citizens Savings Scheme:

Any individual who is over 60 years old is eligible for this tax saving option. The maturity period of Senior Citizens Savings Scheme is 5 years and rate of interest is 8.6%. A maximum of 1.5 lakh can be claimed for tax deduction under Section 80C by investing in this scheme.

NSC (National Savings Certificate):

An investment of up to Rs. 1.5 lakh is allowed for tax deduction under Section 80C in NSC which is postal department scheme. The maturity period of NSC is 5 years and the rate of interest is 7.9% compounded annually.

You can start plan your investment before March and decide the best tax saving options suitable for you. You can contact us here for any expert advice: Best tax saving investment option.

Goods and Services Tax:Understand CGST, SGST and IGST

Goods and Services tax is an indirect tax levied on goods and services in whole nation. There are three types of GST: CGST (Central Goods and Services Tax), SGST (state goods and services tax) and IGST (integrated goods and services tax). Before GST there were different taxes like VAT, Central excise, Service Tax were being levied by the government on consumers which abolished after GST and makes India “one nation one tax”. There are different GST rates for every products and services levied by the Government.

Details of GST rates on different products: GST RATE SLAB

What is CGST (Central goods and services tax)?

CGST which is also known as central goods and services tax levied by the Central Government on any transaction of goods and services. If there is intrastate supply of goods and service then the seller has to collect both CGST and SGST. The CGST will be collected by the central government and SGST will be collected by the state government.

What is SGST (State goods and services tax)?

SGST refers to state goods and services tax is governed by the SGST act and levied by the state where the transaction of products and services are being purchased or sold. The tax collected from intrastate transaction of goods and services in state will be added to the state government revenue.

What is IGST (Integrated goods and services tax)?

IGST also refers to Integrated goods and services tax is a tax charged on all interstate transactions of goods and services. Integrated goods and services tax is governed by IGST act and applicable to all interstate transaction which mean transactions of goods and services within two different states. Under IGST, exports would be zero-rated and tax will be shared between the central state government.

There are many advantages of GST including transparency and less complicated tax structures which aimed at simplifying the tax reforms and make India a business-friendly nation.

Due to many new concepts in goods and services tax you may have many questions related to GST.  For any assistance related to GST:  Check out GST Query support

Latest updates on GST rate and GST filing

The GST council has slashed the GST rates of 178 items of daily use from tax bracket of 28% to 18% which will come in to effect by November 15^th.Good and Services Tax council took a major step to simplify the process of GST returns filing during the meeting held last week. Now only 50 items left in the highest GST rate slab. The recommendations made by the GST council will reduce the compliance burden on businesses and ease the GST returns filing procedure for companies.

The item includes liquid soaps, chocolates, granite, detergents, perfumes, creams, wash basins, plywood, artificial flowers, panels, boards, tiles, ceramic pipes, glass mirrors, doors, fire extinguishers, compound optical microscopes, wrist-watches, razors and after-shave products which is a welcome step to benefit the consumers. There is no change in GST tax rates on consumer durables. These changes in GST rates of daily use items will increase the consumptions, affordability and consumer sentiment according to the industry experts.

In order to know more about the GST rates of other items included in 5%, 12% and 18% click here: https://www.trutax.in/gst-rate-slab

Changes in GST forms:

The GST council has decided to simplify the GST returns filing process for both small businesses and large enterprises. Before these changes the taxpayers had to file GSTR-1, GSTR-2 and GSTR-3 by 10^th ,5^th and 20^th of the subsequent month respectively.

There are two cases for GST returns filing depends on turnover of businesses.

Businesses with turnover of up to Rs. 1.5 crore a year:

-The last date to file GSTR-1 form for July to September is December 31.

-The last date to file GSTR-1 form for October to December is February 15, 2018.

-The last date to file GSTR-1 form for January to March by April 30, 2018.

Companies with turnover of 1.5 crore or more a year:

-The last date to file GSTR-1 form for July to October is December 31.

-They have to file monthly returns but with a delay of 40 days from the end of the taxable period.

Know more about the details of other GSTR forms and its deadline dates:  https://www.trutax.in/gst-returns-filing

Penalty for last filing of GST returns:

The GST council has also revised the penalty charges for late GST return filing to reduce the compliance burden on small and large businesses. The penalty for late filing of GST return has been cut to 20 per day from 200 per day for small business with a turnover of up to Rs. 1.5 crore and 50 per day for companies with the turnover of Rs. 1.5 crore or more.

It is very important to file the GST returns on time without any errors.

For any expert assistance related to GST returns filing process or query, click here: https://www.trutax.in/askexpert

Understand Defective Return Notice under Section 139 (9) | Upload form 16 on TruTax

Understand Defective Return Notice under Section 139 (9) | Upload form 16 on TruTax

Understand Defective Return Notice under Section 139 (9)

If you get the Notice under Section 139 (9) then it is about Defective Return Notice. You can get this Income Tax Notice under Section 139 (9) due to various reasons and mistakes done while filing your income tax returns. There is no need to panic about this notice as you just need to understand the reason behind it which you will get through mail by Income Tax Department.

In case if you will get the Defective Return Notice then you just need to correct your mistakes and provide the required information mention on mail while filing your return again within given deadline. You will get 15 days to rectify the errors and file your returns correctly. In case if you ignore this notice and fail to rectify the errors mention by the Income Tax Department then your return will be treated as invalid which can be resulted into serious consequences.

Reasons of Defective Return Notice under Section 139 (9):

- Proof of TDS, Advance Tax and Self Assessment Tax.

- Incorrect Income Details Information.

- Claiming Income Tax Refund without paying full taxes.

- Mismatch name on Income Tax Return and PAN Card.

- Fail to provide copy as proof in case of audit under Section 44AB.

- Incorrect income information under the head “profits and gains”.

- Failure to provide mandatory information in ITR form.

It is very important to rectify these errors and file your income tax return within given deadline.

How to rectify the errors under in Defective Return Notice u/s Section 139 (9)?

The process to submit the response to Defective Return under Section 139 (9) as follows:

-Login to Income Tax e-filing Website: http://www.incometaxindiaefiling.gov.in/.

-Click on “e-file in response to Notice u/s 139 (9).

-You will be redirected to the page where you can check the Defective Return Information.

-If the assesse agree with the specified defective return info then you need to select “Yes” under the column name “Do you agree with defect”. In other case Assess can also select “No” if assesse does not agree with the defective return and mention remarks also to provide information.

-If Assesse is agree with defective return and selected “Yes” then Assesse need to upload the relevant XML Return.

-On successful completion of the response to the defective return assesse can view the success screen and click on “View” link under response column. Assesse can also note down the acknowledge number and date while filing the Return.

Click here to know about the Income Tax notice under Section 143: https://www.trutax.in/income-tax-notice