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How entrepreneurs should respond to a notice from the income tax department

A tax notice is uncomfortable, but in most cases manageable and is certainly not a reason to panic.

Tax Optimiser: How professional Mavalankar can save tax via NPS, rejigging perks

Varsha Mavalankar's pay structure is fairly tax friendly but there is scope to reduce the tax by over Rs 40,000 if she gets more tax-free perks.

Delayed release of electronic ITR forms may compel CBDT to extend the filing deadline

The last date to file ITR is July 31, 2018 and almost a third of the time is over. The CBDT has not released the utility for filing of returns ITR-2 and ITR-3.

Here's how Flipkart employees' ESOPs will be taxed

The money that Flipkart employees are now expected to make from ESOPs has caught the limelight. Here's a lowdown on how ESOPs are taxed in India.

Your official tour daily allowance will be taxed if you don't have bills

Your official tour daily allowance will be taxed if you don't have bills

To claim the per diem allowance as exempt from tax, employees will have to maintain bills and vouchers of expenditure incurred by them while on offi

Tax queries: Can you claim deduction for NPS contribution made by your employer?

With effect from Assessment Year 2016-17, an additional deduction of Rs 50,000 for contribution towards NPS by employee is allowed u/s 80CCD(1B).

Tax optimiser: How salaried Pandit can cut tax by 80% by rejigging salary, opting for NPS

Pandit’s tax can be reduced by more than 80% if salary is rejigged to include tax-free perks, he opts for the NPS benefit offered by his company.

Tax Optimiser: How NPS, perks can help salaried Das reduce his tax by 28%

Das can reduce his tax if his pay structure is revised to include more tax free perks, he opts for the NPS benefit offered by his company and invests more in the scheme on his own

More clarity needed regarding availing concessional LTCG tax: View

The consultative and pro-active approach adopted by CBDT is appreciable since unintended hardships may be experienced in certain fact specific cases.

How to fill the new details required in ITR-1

How to fill the new details required in ITR-1

Unlike last year, this year's form requires taxpayers to provide break-up of their salary income like taxable allowances and income from house prope

Tax queries: How will LTCG tax be calculated while switching from dividend to growth plan of an MF?

Dilip Lakhani, Senior Chartered Accountant, answers queries from our readers on income tax and other levies.

How to calculate LTCG on equity mutual funds after re-categorisation

When a scheme is merged, you will not be taxed on the long and short term gains you will make whenever you will sell the units. Further, merger of equity MFs will not affect the holding period of your investments.

How to submit Form 15H, Form 15G to avoid TDS on interest income

If your interest income exceeds Rs 10,000 in a year, the bank will deduct 10 percent as TDS on the entire interest amount.

When and how should a tenant deduct TDS on rent paid to landlord?

Individuals paying rent of more than Rs 50,000 per month have to deduct 5% of the rent paid in a financial year as tax. Here's how to pay it.

How income tax department can penalise you for under-reporting, misreporting income

How income tax department can penalise you for under-reporting, misreporting income

As per the I-T laws, in case of misreporting of income the I-T officer can levy a penalty of 200% of the amount of tax payable on under-reported inc

The Bengaluru case that turned the taxman's gaze on India's salaried class

Income tax department has warned that tax payers should not fall prey to unscrupulous tax advisors or planners who help them in preparing wrong claims

Tax queries: VRS benefit up to Rs 5 lakh is exempted from tax

Dilip Lakhani, Senior Chartered Accountant, answers queries from our readers on income tax and other levies.

Income Tax department warns salaried class again filing wrong ITRs

The tax filing season for salaried class taxpayers has just begun with the Central Board of Direct Taxes (CBDT), that frames policy for the department, recently notifying the new ITRs.

Income tax department warns salaried taxpayers against tax evasion by under-reporting income

The income tax department has warned salaried taxpayers against under-reporting income or inflating deductions/exemptions while filing income tax returns.

Submit investment declaration to your employer on time to avoid excess TDS

Submit investment declaration to your employer on time to avoid excess TDS

A investment declaration is basically a list of the tax saving investments which the employee proposes to make during the year.

GST may lead to salary restructuring for you as an employee: View

If the service of providing food can be considered as supply, the employer can surely be considered as a Supplier under the GST act.

Tax Optimiser: How salaried Raj can save tax by paying rent to his father

Vivek Raj has a fairly tax-friendly salary structure but still pays a high tax because he is unable to avail some of the exemptions.

Tax queries: Gifts from a relative defined under I-T act are tax exempt

Dilip Lakhani Senior Chartered Accountant, answers queries from our readers on income tax and other levies.

Owners of multiple flats used as single unit can get tax break: ITAT

Under section 54, if an investment is made in ‘one’ residential house in India, within the stipulated period, then the cost of the new house is deducted and only the balance component of the LTCG is taxable.

New ITR forms make it difficult to evade tax on HRA: Here's why

New ITR forms make it difficult to evade tax on HRA: Here's why

The new forms for FY 2017-18, which were released on April 3, attempt to digitally collect as much information as possible to process tax returns ef

Capital gains tax exemption valid even if housing loan used for new house: ITAT

If on sale of a residential house (held for at least two years), the taxpayer makes a profit, then such profit is treated as a long term capital gain (LTCG).

How to calculate long-term capital gains tax on mutual fund SIPs

From April 1, 2018 any LTCG made on transfer of equity MFs will have to pay a 10 per cent tax on long-term gains above Rs 1 lakh per annum.

7 tax changes that will impact your money from FY 2018-19 onwards

A new financial year may not call for resolutions and lifestyle changes, but your financial life will undergo a quite a few alterations in 2018-19.

Tax Optimiser: How salaried Kumar can reduce his tax outgo by 34% using NPS

Taxspanner estimates that Kumar can reduce his tax by more than 30% if his company offers him NPS benefit and he invests more in the scheme on his own.

How section 80G can help you save income tax

How section 80G can help you save income tax

This deduction can be availed by any person or assessee who makes an eligible donation to prescribed funds and institutions.

Missed the March 31 deadline to file income tax return? Here's what you can do

If you have missed the March 31 deadline to file ITR, the income tax department can allow taxpayers to file returns post the deadline for specific cases.

Income tax department wants to know a little bit more about you

By collecting more specific information from taxpayers through its new forms, the income tax department aims to check tax evasion.

Tax queries: Investment in Bitcoins not allowed under LRS scheme

Every week, an expert selected by ET answers queries from our readers on tax.

Taxman nudged banks to deposit TDS by March 31

Banks and corporates are allowed to pay the TDS or the tax deducted at source for any month by the seventh of the next month. For March, the TDS can be paid on or before April 30.

Tax Optimiser: How Madhok can use NPS, health cover to cut tax outgo by over Rs 53,000

Tax Optimiser: How Madhok can use NPS, health cover to cut tax outgo by over Rs 53,000

Paying too much tax? Write to us at etwealth@ timesgroup.com with ‘Optimise my tax’ as the subject to know how to reduce your tax.

Penalty on late filing of ITR and other tax changes effective from Apr 1

Penalty on belated ITR, tax on LTCG from shares and equity-oriented mutual funds, here are the tax changes effective from April 1.

Didn't file ITR for last two financial years? Here's why you should before March 31

As per the income tax laws, it is mandatory for individuals having income more than basic exemption limit (depending on the age) to file ITR.

Bitcoin loss booked before March 31 can save you capital gains tax this fiscal: Here's how

Investors with short-term capital gains on equity can look at booking losses from sale of cryptocurencies (if deemed as short-term capital assets) before March 31, 2018 and setting of the latter against the former.

Quick tax-saving tips

Here are tax breaks you can claim on various incomes and expenditures under different sections of the Income-tax Act, 1961 that can reduce your tax outgo.

Rushing to make last-minute tax-saving investments? Maybe you don't need to

Rushing to make last-minute tax-saving investments? Maybe you don't need to

Here are a few expenses that come with tax advantages and will help you neutralise your tax outgo for the current financial year.

6 online tax-saving investments for late-starters

The equity-linked savings scheme (ELSS) is a product where you can make online investments up till 3PM on the day when stock market is open.

Have you done your tax-saving right?

Calculating your tax liability correctly and using the tax breaks offered under Section 80C are few points to check during your tax-saving exercise.

Buying property jointly? Get the paperwork right to avoid loss of tax breaks

The Bangalore bench of the Income-tax Appellate Tribunal has rejected the plea of a couple who were trying to separately claim exemption on LTCG.

Tax Optimiser: How engineer Shastri can cut tax by submitting bills

Software engineer Amit Shastri’s salary is packed with tax-free perks, but he pays tax on some of these due to his inability to submit bills.

TDS on rent and other tax tasks to complete before March 31

TDS on rent and other tax tasks to complete before March 31

If you still have not completed the necessary tax-related tasks, now is the time to do it instead of leaving it till the very last minute.

Tax queries: Am I liable to pay tax on unsold flat after receiving the occupancy certificate?

Dilip Lakhani, Senior Chartered Accountant answers queries from our readers on income tax and other levies.

Planning to invest LTCG in Sec 54EC bonds to save tax? Do it before 31 March

You should invest in 54EC bonds before 31 March 2018 as bonds issued after this date will have to be held for a minimum of five years.

Submitting fake bills to lower your tax liability? Tax department has ways to catch you

While submitting proof for reimbursements make sure it is real and not fake as that would get you in serious trouble with the tax department.

Tax Optimiser: How tax-free perks, NPS can reduce salaried Narang's tax outgo by Rs 65,000

Rishi Narang’s salary is not very tax friendly. More than 15% of his income is swallowed by tax. Few tax-free allowances and the NPS benefit can reduce his tax.

Tax queries: How is sale of residential property taxed?

Tax queries: How is sale of residential property taxed?

Dilip Lakhani, Senior Chartered Accountant, answers queries from our readers on income tax and other levies.

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Income Tax: All about it

Income tax is a tax levied directly by the central government on the incomes earned by the individuals and other non-individual entities such as Hindu Undivided Family (HUF), partnership firm and so on during a financial year. These various sources of income include salary, pension, capital gains, sale of financial investments, interest income, other incomes and so on.

Unlike the Goods and Services Tax (GST) Council where the Union Finance Minister and State Finance Ministers decide the rates, the income tax rates are announced by the Finance Minister during the year’s Union Budget.

The rate at which your total income earned during the year will be taxed depends on the slab in which your income falls. Over and above the income tax, a cess and surcharge is levied. The cess is payable by all taxpayers. For those earning more than Rs 50 lakh a year, a surcharge is levied between 10 percent and 37 percent.

The total income earned by a taxpayer during a financial year has to be reported to the government in the assessment year by filing income tax return (ITR).

Financial year is the year in which income is earned by a taxpayer; a financial year is between April 1 and March 31. Assessment year is the year immediately following the financial year for which the return is to be filed.

Income earned from various sources such as salary, pension, interest from fixed deposits (FDs), savings account, capital gains from sale of house, equity mutual funds, debt mutual funds and so on have to be reported in ITR.

1. What is the basic exemption limit for individuals aged below 60 years?
According to income tax laws, it is mandatory to file ITR if your income exceeds the basic exemption level. The basic exemption level depends on the age of the individual during the financial year.

Currently, for individuals below 60 years of age, the maximum income exempt from tax is Rs 2.5 lakh in a financial year. This can change depending on the announcements made in the Union Budget.

2. What are the tax rates at which income is charged?
The income tax slab rates are 5 percent, 20 percent, and 30 percent.
Also Read: Latest income tax slabs

3. How to file income tax return
An individual can file income tax return by registering himself on the incometaxindiaefiling.gov.in or via private e-filing websites.

4. What is the difference between gross total income and net total income?
Gross total income refers to the total income earned by the taxpayer. Income tax laws allow an individual to claim certain tax-exemptions (such as house rent allowance) and deductions under various sections such as section 80C for investments made in Public Provident Fund, equity mutual funds etc. of up to Rs 1.5 lakh.

Gross total income minus tax-exemptions and deductions would result in net total income. The tax liability of the person will be calculated on the net total income.

5. What is the last date to file income tax return?
The last date to file income tax return for individuals is July 31, unless extended by the government.


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