Employers are supposed to hand over Form 16 within 30 days of the end of a financial year, that is, by 30 April. Ask your employer to issue Form 16 immediately so that you dont miss the 31 July deadline for filing return for salaried employees. If you think that your employer might not issue the form in time, you can write a registered letter to him on the issue and send a copy of this to your assessing officer. The employer can be penalized for not issuing the form in time. If no tax was deducted at source, you can ask your employer for a salary certificate on his letterhead stating your salary during the financial year. This certificate can be used to file a return.
I have earned under two headssalary and capital gains. Which form should I use to file my return? How will my tax be assessed?
As an individual assessee, if you have earned income from capital gains in addition to your salary, you will have to file your return in form ITR-2. For taxation, you will have to first segregate capital gains into short-term (STCG) and long-term (LTCG).
Any gain from selling shares held for more than a year is termed long-term. Gain from sale of shares held for a year or less is called short-term. If you have paid the securities transaction tax on all share trading, LTCG will be exempt from tax and STCG will be taxed at 10% for fiscal 2007-08. Your gross tax outlay will depend on your salary income, income from capital gains, income from other sources such as interest on bank deposits, and the deductions you are entitled to.
I have misplaced my insurance receipt. Is it necessary to attach it and other relevant documents with the tax return?
No attachments are needed with the current ITR forms as the forms themselves capture most of the required information. You dont even need to attach the computation sheet with the form. After you submit the form, the I-T department cross-references the TDS details using Oltas (the online tax accounting system). However, make sure to carry the photocopies of all the relevant documents to the income-tax office.
I bought shares worth Rs1.25 lakh last year. Do I have to disclose that and other transactions?
Certain disclosures are mandatory while filing an incometax return. Among these are investments above a specified amount in bank deposits, mutual funds, shares and property in the financial year for which the return is being filed, 2007-08 in this case. The cut-off amount of investment from where disclosure should be made is: Rs1 lakh or more for shares, Rs2 lakh for credit card payments, up to Rs10 lakh for deposits in one bank during the year, Rs2 lakh for mutual funds, Rs5 lakh or more for bonds or debentures issued by a company, Rs5 lakh or more for RBI bonds and Rs30 lakh or more for the purchase, or from the sale, of immovable property.
I was in two jobs. How should I file the return?
The aggregated income from both your employers will be considered while calculating your tax.Ideally, both companies should give you Form 16 for salary earned during the relevant period. Try to get a salary certificate from your previous employer if you cannot get Form 16. Submit this estimate and a declaration in Form 12B to your current employer, who will then incorporate these details in the Form 16 that he issues.
Can I use my investment in ELSS (equity-linked savings scheme) this year to reduce last years tax liability?
No. But if you had not claimed any deductions in the previous years return, you may file a revised return to claim a refund. Fresh investments will not be eligible for deductions from last years income.
Taxes get deducted from my salary every month. Do I need to file an income-tax return?
Yes. Filing is compulsory for every person whose gross total income, that is, the income under the five heads before allowing for any deduction such as insurance premium, exceeds the basic exemption limit. For financial year 2007-08 (assessment year 2008-09), this exemption limit was Rs1.45 lakh for women below the age of 65, Rs1.95 lakh for persons above 65, and Rs1.10 lakh for any other individual. Everyone falling in the tax bracket should file a return, even if his tax liabilities have been taken care of by the employer through tax deducted at source (TDS). Persons whose salaries have been subjected to TDS are also required to file a return because they may have earned from sources other than salary.
I incurred losses last year while trading in shares. Can gains from other sources set these off?
Short-term capital losses can be set off against long-term (LTCG) or short-term capital gains (STCG), but long-term capital losses can only be set off against LTCG. Loss from trading in shares cannot, however, be set off against gains from other incomes. A loss that is not wholly set off in the financial year in which it is incurred can be carried forward to eight succeeding assessment years.
What if I miss the 31 July deadline?
If there are no balance taxes to be paid, no interest or penalty will be levied if you file your return before 31 March 2009. However, there is a penalty of Rs5,000 if you fail to file by that date. In case there are tax arrears, a penalty of 1% per month will be charged as interest on the taxes due.
Where do I file my return?
The filing process has been centralized, so ou can file your return anywhere in the country, at I-T offices and even post offices. If a person has relocated, he just needs to intimate the change of address and file his return at the new location. Filing can also be done through the Internet. Help can be taken from authorized intermediaries, too.
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