Income Tax Return: Last 3 days to go before July 31 deadline expires; key things to remember by all taxpayers

Finally, only three days are left before the deadline to file income tax return for financial year 2023-24 expires on July 31. And so far, there is no hope of this deadline to be pushed further. Although some optimists believe in the dogma of ‘never say, never’, while the more realists have accepted this deadline as a fait accompli. 

Regardless of which category you fall in, you will have to file the income tax return at some point and there are key points which you should be mindful of. Here we recapitulate some of them. These include the income tax forms that you need to use, what are the other documents that you need to access, verification of return after filing it and so on and so forth.

These are the key points you need to be mindful of:

Which income tax form do you need to submit?

There are several income tax forms and you need to opt for the right form based on your income and other factors:

ITR-1 (Sahaj): This I-T return form is used when you are a salaried individual, have one house property, and other sources such as interest income or family pension. It is meant for the residents whose total income does not exceed ₹50 lakhs.

ITR-2: This tax form is used by individuals and Hindu Undivided Families (HUFs) who have income from salary, but own more than one house property, capital gains, and other sources. However, this does not include income from business or profession.

ITR-3: Now, this income tax form is applicable to individuals and HUFs who earn their income from business or profession. This requires detailed reporting of income, which also entails profit and loss (P&L) statements along with balance sheets.

ITR-4 (Sugam): This income tax form is meant for taxpayers who opt for presumptive income schemes covered under Sections 44AD, 44ADA, or 44AE of the Income Tax Act. Essentially, it is meant for small businesses and professionals.

ITR-5: This form is meant for firms, LLPs (Limited Liability Partnerships), Association of Persons (AOPs), and Body of Individuals (BOIs). It also includes entities other than companies which are not required to furnish audit reports under any law.

ITR-6: This tax form is applicable to entities other than those claiming exemption under Section 11 (income from property held for charitable or religious purposes).

ITR-7: This income tax (I-T) form is meant for persons including companies required to furnish returns under Sections 139(4A) or 139(4B) or 139(4C) or 139(4D) (i.e., trusts, political parties, institutions).

Can I file my tax return under the old tax regime?

This year, the default regime is a new tax regime. But if you have invested in a number of tax saving instruments then it is vital that you claim exemptions against those investments. Therefore, you can file your income tax return under the old tax regime. For that, you need to simply tick ‘opting out of the new tax regime’ in the income tax form if you fall under ITR-1 and ITR-2.

And if you are supposed to file income tax return forms ITR-3, ITR-4 and ITR-5, then you have to submit a declaration under form 10-IEA in order to opt out of the new tax regime.

After filing the I-T return, is this mandatory to verify the same?

Yes, it is mandatory to verify the income tax return (ITR) even after filing the return. Online verification serves as the final step in completing the ITR filing process. Without this, filing the return is considered invalid and is not processed by the Income Tax Department. So, this may lead to penalties, delays or at times, notices from the tax department.

What are AIS, TIS and 26AS?

If you are a salaried taxpayer, you can file your income tax return based on the details given in form 16. Besides, you can access the details given in AIS, TIS and 26AS.

The Annual Information Statement (AIS) summarises financial transactions, tax payments, and refunds. Taxable Income Statement (TIS) simplifies the details given in AIS for comprehension of taxpayers. At the same time, Form 26AS serves as a tax credit statement which displays details of TDS (tax deducted at source) and TCS (tax collected at source).

Can you file the ITR for the previous two years?

Yes, along with the tax return for FY 2023-24, you can also file your return for the previous two years if you missed filing them. But remember that you need to file ITR-U (updated income tax return).

What will happen if you miss the July 31 deadline?

As we are aware that missing the July 31 deadline for filing ITR means the income tax department can impose a late filing fee of ₹5,000 under Section 234F of the Income Tax (I-T) Act. The fee is slashed to ₹1,000 if your income is lower than ₹5 lakh.

Also, you are not allowed to carry forward your losses arising out of investment in stock market,mutual funds or any of the businesses if you miss filing your ITR before the deadline. Besides, you will not be able to file your return under the old tax regime after July 31 since the default regime for FY 2023-24 is the new tax regime.