DUE DATE EXTEND FOR RETURN FILING TO 5TH August 2017

Shree Sainath Consultancy

DUE DATE EXTEND FOR RETURN FILING TO 5TH August 2017

In view of the difficulties faced by taxpayers, date for filing of income tax returns for F.Y.2016-2017 (A.Y.2017-2018) has been extended to 5th August 2017 for non Audit Case Only.

What is an income tax return?

What is an income tax return?

An income tax return is a form where taxpayers declare their taxable income, deductions, and tax payments. This procedure of filing income tax returns is referred to as income tax filing. While filing the actuals, the total amount that should go to the government as income tax is calculated. If you've paid more tax than needed for the financial year, you'll be refunded by the income tax department. Sometimes, you may also see that you have underpaid taxes for the year. In such cases, you must pay the remainder of the tax, and file your income tax returns.

Income tax return form ranges from ITR 1 to ITR 7, used for different types of income. Some income tax return forms are longer than the others, and they may need additional disclosures such balance sheet and a profit and loss statement information.

Know About Tax

Let us discuss the entire process of income tax in India.

31 January	31 March	31 July	Oct - Nov
Deadline to submit your investment proofs	Deadline to make investments under Section 80C	Last date to file your tax return	Time to verify your tax return

Income Tax in India

There are two types of taxes in India – direct and indirect.

A direct tax is a tax you pay on your income directly to the government. Indirect tax is a tax that restaurants, theatres and e-commerce websites charge you on for goods or a service. This tax is, in turn, passed down to the government. Indirect taxes take many forms: service tax on restaurant bills and movie tickets, value added tax or VAT on goods such as clothes and electronics.

Goods and services tax, which is scheduled to roll out in July 2017, is going to be a unified tax that will replace all the indirect taxes that business owners have to deal with.

What Is a Capital gain?

What is a Capital Gain?

Any profit or gain that arises from the sale of a ‘capital asset’ is a capital gain. This gain or profit is charged to tax in the year in which the transfer of the capital asset takes place.

Capital gains are not applicable when an asset is inherited because there is no sale, only a transfer. However, if this asset is sold by the person who inherits it, capital gains tax will be applicable. The Income Tax Act has specifically exempted assets received as gifts by way of an inheritance or will.

Saving tax on long-term capital gains

The Income Tax Act has laid out exemptions under Section 54 and Section 54F to help taxpayers save tax on capital gains.

(1)Exemption under Section 54 is available on long-term Capital Gain on sale of a House Property.

(2)Exemption under Section 54F is available on long-term Capital Gain on sale of any asset other than a House Property




.

To reiterate, both the exemptions are available only on long-term capital gains.

Common requirements between the two Sections:

1. A new residential house property must be purchased or constructed to claim the exemption
2. The new residential property must be purchased either 1 year before the sale or 2 years after the sale of the property/asset.
3. Or the new residential house property must be constructed within 3 years of sale of the property/asset
4. If you are not able to invest the specified amount in the manner stated above before the date of tax filing or 1 year from the date of sale, whichever is earlier, deposit the specified amount in a public sector bank (or other banks as per the Capital Gains Account Scheme, 1988).
5. Only ONE house property can be purchased or constructed.
6. Starting FY 2014-15 it is mandatory that this new residential property must be situated in India. The exemption shall not be available for properties bought or constructed outside India to claim this exemption.

Differences between these two Sections:

Section 54	Section 54F
To claim full exemption the entire capital gains have to be invested.	To claim full exemption the entire sale receipts have to be invested.
In case entire capital gains are not invested - the amount not invested is charged to tax as long-term capital gains.	In case entire sale receipts are not invested, the exemption is allowed proportionately. [Exemption = Cost the new house x Capital Gains/Sale Receipts]
	You should not own more than one residential house at the time of sale of the original asset.
This exemption will be reversed if you sell this new property within 3 years of purchase and capital gains from sale of the new property will be taxed as short-term capital gains.	This exemption will be reversed if you sell this new property within 3 years of its purchase or construction OR if you purchase another residential house within 2 years of the sale of the original asset or construct a residential house other than the new house within 3 years of sale of the original asset. Capital gains from the sale will be taxed as long-term capital gains.

Key points to remember

• If the cost of the new residential property is lower than the total sale amount, then the exemption is allowed proportionately. For the remaining amount, you can reinvest the money under Section 54EC within 6 months.
• The property must only be bought on the name of the seller and not on anybody else's name.
• If the builder of the new residential construction fails to hand over the property to the taxpayer within 3 years of purchase, the exemption is still allowed.

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Due date of filing income tax return for fy 2016-17 (ay 2017-18)

Due date of filing income tax return for FY 2016-17(AY 2017-18) is

31st July 2017 for Individuals

30th September 2017 for Businesses

(This is income tax return for the financial year 2016-17. Applicable for income earned from April 1st, 2016 to March 31st, 2017).

Income Tax Slab For Senior Citizens

PART II: Income Tax Slab for Senior Citizens (60 Years Old Or More but Less than 80 Years Old)(Both Men & Women)

Income Slab	Tax Rate
Income up to Rs 3,00,000*	No tax
Income from Rs 3,00,000 – Rs 5,00,000	5%
Income from Rs 5,00,000 – 10,00,000	20%
Income more than Rs 10,00,000	30%
Surcharge: 10% of income tax, where total income exceeds Rs.50 lakh upto Rs.1 crore. Surcharge: 15% of income tax, where the total income exceeds Rs.1 crore.
Cess: 3% on total of income tax + surcharge.
*Income tax exemption limit for FY 2017-1 is up to Rs. 3,00,000 other than those covered in Part(I) or (III)

Income Tax Slab Rates For FY 2017-18 (AY 2018-19

Income Tax Slab Rates for FY 2017-18(AY 2018-19)

For FY 2017-18, the slab rate for income tax up to Rs. 5 lakh has gone down from 10% to 5%.

PART I: Income Tax Slab for Individual Tax Payers & HUF (Less Than 60 Years Old) (Both Men & Women)

Income Slab	Tax Rate
Income up to Rs 2,50,000*	No tax
Income from Rs 2,50,000 – Rs 5,00,000	5%
Income from Rs 5,00,000 – 10,00,000	20%
Income more than Rs 10,00,000	30%
Surcharge: 10% of income tax, where total income exceeds Rs.50 lakh up to Rs.1 crore. Surcharge: 15% of income tax, where the total income exceeds Rs.1 crore.
Cess: 3% on total of income tax + surcharge.
*Income tax exemption limit for FY 2017-18 is up to Rs. 2,50,000 for individual & HUF other than those covered in Part(II) or (III)