Best Income Tax Return Filing Service India, NRI ITR Filling

Introduction

Income Tax Return is a form in which an Assessee files his information about Income and tax payable to the Income Tax Department. According to the income tax laws, Income Tax Return must be filed every year by a person or business that makes any income in the form of a salary, business gains, earning from house property or gains from dividends, capital or other sources during a financial year.

Due Date to file ITR For Financial year

The Income Tax Act 1961 obligates citizens to file returns for every financial year within the specified due date. The due date to file Income Tax Return for the individuals who do not need to get their ITR audited under any law is 31st July of the Assessment Year and for those who need to get their ITR audited under law, the due date is 31st October of the Assessment year which may be extended by the department. However, this is changeable on the issuance of directive to this effect by the Income Tax Department or the Ministry of Finance, India.

Belated return can be furnished till 31^st December of the Assessment year.

Conditions that mandate the filing of Income Tax Returns for Individual

When the gross annual income exceeds the specified limit
When the gross annual income of an individual exceeds the specified limit, it becomes mandatory for him to file an Income Tax Return
When there is more than one source of income such as capital gains, house property etc.
When the taxpayer wants to behest for an income tax refund from the IT department
When there is earning from or investment made in foreign assets during the FY
When the taxpayer want to apply for a visa or a loan
When the taxpayer is a firm or company or a firm (regardless of gain or loss)

Types of ITRs

There are seven types of returns viz. ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7 to be filled by the individual based on a few circumstances like the source of income, total amount of income in F.Y. etc. Let us have deeper dive into these circumstances and type of ITR that is suitable for them.

ITR-1 OR SAHAJ

Suitable for: Resident individual whose source of total income includes:

Salary or Pension
One House Property (other than the case when loss is carried forward from preceding years)
Other Sources (other than winning from Lottery and Horse Races)
Agriculture (up to INR 5000)

Conditions when use ITR 1 Form is restricted

Total income surpassing the limit of INR 50 lakh
Agricultural income surpassing the limit of INR 5000
Availability of taxable capital gains
In the presence of income from business/profession
In the presence of income from more than one house property
When the taxpayer is company’s director
When the investments are made in unlisted equity shares at any point of time in the financial year
When the resident taxpayer owns assets that draws financial interest, outside India (that includes signing authority in any account outside the country).
When the resident taxpayer is not ordinarily resident (RNOR) and non-resident
When the taxpayer owns foreign assets/foreign income
When the taxpayer is assessable w.r.t income of another person on which tax is deducted in other person’s hand.

ITR-2

Suitable for: Individual or a Hindu Undivided Family (HUF) who are not involved in carrying out any business or profession but the source of total income includes:

Salary or Pension
House property
Other sources including gain from lottery and racing horses
Capital gains from property
Foreign income/ foreign assets
Loss when the investment is sold out
Resident who is not ordinarily resident and a non-resident as well
Agricultural income surpassing the limit of INR 5,000
Director at Listed Company & Unlisted Company
When the investment is made in unlisted equity shares at any point of time in the F.Y.

Note: Total income from the first four sources must be above 50 Lakhs)
When the income of another individual like spouse or child is clubbed together with assesses income, ITR 2 is allowed to be used when income comes under any of the above-mentioned categories.

Ineligibility to file ITR 2

An individual whose total income encompasses Income from Business or Profession are not eligible to file ITR 2.

ITR-3

Suitable for: Individual or Hindu Undivided Family whose source of income is proprietary business or profession i.e. the individuals or HUFs whose source of income includes:

Income from Business or Profession
When the taxpayer is an Individual Director in any company
When investment is made in unlisted equity shares at any point of time during the F.Y.
Income may include Income from House property, Salary/Pension, other sources, bonus, interest, commission or remuneration from the partnership firm
Taxpayers registered under presumptive taxation scheme and having a turnover above 2 crore.
HUFs and Individuals who are partners in a business but do not perform business operations under proprietorship.

ITR-4 or Sugam

Suitable for: Individuals & HUFs who are residents with profession or business as a source of income. Partnership firms (except LLPs) and individuals who are registered under the presumptive income scheme as per Section 44AD, 44ADA and 44AE of the Income Tax Act are also eligible to file ITR-4.

Note: When the turnover of the business surpasses the limit of INR 2 crore, the taxpayer becomes ineligible to file ITR-4, instead he needs to file ITR-3.

Ineligibility to file ITR 4

Following conditions knocks the eligibility to file ITR-4

When the total income surpasses the limit of INR 50 lakh
When income is from more than a single house property
When the loss has been/is to be carried forward under any head of the income
When the taxpayer owns any foreign asset
When the taxpayer has signing authority in any account in foreign country
When the taxpayer has source of income in foreign country
When the taxpayer is company’s director
When the taxpayer have/had made investments in unlisted equity shares at any point of time in the financial year
When the taxpayer is a resident not ordinarily resident (RNOR) and non-resident
When the taxpayer has foreign assets or income
When the taxpayer is assessable w.r.t income of another individual in concern of which tax is taken away in the part of the other individual.

ITR-5

Suitable for: Firms, AOPs (Association of persons), LLPs, BOIs (Body of Individuals), Estate of deceased, Artificial Juridical Person (AJP), Estate of insolvent, Investment Fund and Business Trust.

ITR-6

Suitable for: Companies that are not claimant u/s 11 of the Income Tax Act, 1961 or companies other than those which need to file ITR in Form ITR-7.

ITR-7

Suitable for: Tax assessee who needs to file ITR under the subsections of Section 139 of the Income Tax Act, 1961 viz. section- 139(4A), 139(4B), 139 (4C) and 139 (4D).

An Overview: Types of ITRs and Relevance

Form	Applicability	Salary	Exempt Income	Capital Gains	House Property	Business Income	Other Sources
ITR-1	Resident Indian Individuals and HUFs	✓	Yes. Note: Income from agriculture must be equal to/less than INR 5,000.	✘	✓ Note: Income must be only from one house property	✘	✓
ITR-2	Individuals and HUFs	✓	✓	✘	✓	✘	✓
ITR-3	Individuals, HUFs and Partner in a firm.	✓	✓	✘	✓	✓	✓
ITR-4	Firm, HUF, or Individual	✓	✓ Note: Income from agriculture must be equal to/less than INR 5,000.	✓	✓ Note: Income must be only from one house property	Only for the presumptive business income.	✓
ITR-5	LLPs or Partnership Firms	✘	✓	✘	✓	✓	✓
ITR-6	Companies	✘	✓	✘	✓	✓	✓
ITR-7	Trusts	✘	✓	✘	✓	✓	✓

So, ITR 1, ITR 2, ITR 3 and ITR 4 are the only ITR forms for individuals. Now we will discuss the process to download the ITR Forms.

Download & File the ITR forms

TR forms are downloadable from the official website of the Income Tax Department – https://www.incometaxindia.gov.in/pages/downloads/income-tax-return.aspx
Individuals may opt for an ITR among ITR-1, ITR-2, ITR-3, ITR-4, and ITR-7, based on the type of income he/she makes.
The Income Tax Returns are available in the PDF format and can be filed on the official website of Income Tax, following the instructions available on the same website – https://www.incometaxindiaefiling.gov.in/home

Everyone is not well-acquainted with the ITR filing process, understanding that the IT Department has presented a few simple steps to file ITR on its official website. However, yet it remains a complicated process so to make it a smooth sailing process, some CA consultancies or companies that CA/CS services file the ITR on behalf of the Assessee by charging a nominal fee.

However, it is a duty of the assessee to choose right for right services. For more information, get in touch with us. Happy to help you!

ITR For Companies

Income Tax Return has to be filed in Form ITR -6 by private limited companies, one-person companies and limited companies before the due date to file the ITR for a company i.e. on or before the 31st of October.

Companies other than companies who are eligible to claim exemption u/s 11 companies have to file their income tax return in ITR-6 Form. Companies who earn income from properties which are held by them for charitable or religious purposes are eligible to claim exemption u/s 11.

So, the companies which do not claim an exemption for income earned from property held by them for charitable and religious purposes, are eligible to file ITR 6.

Due Date to File ITR for Companies

31st of October is the due date to file an income tax return by the companies registered in India. Unlike MCA annual returns, even if companies are registered from January to March, they must file income tax returns on or before 31st October of the same calendar year.

Businesses which are required to get their account audited have to file their ITR before 30th September 2023.

ITR to Be Filed

ITR Return	Companies
ITR-6	Public Limited company Private Limited Company One person Company
ITR-7	Section 8 company

Companies registered in India and engaged in a business for profit must file Form ITR 6. Hence, limited companies, private limited companies and one person companies must file Form ITR6. ITR 7 must be filed by Section 8 Company i.e. Companies carrying operations for non-profit purposes.

Annexures Required

Any annexures including the TDS certificate, bank statement, investment proof need not be submitted while filing ITR-6. However, assesses must cross-check the taxes deducted/paid/collected/paid by them (or on behalf of them) with the Tax Credit Statement Form 26AS.

I. ITR Form 6: Structure

There are two parts in ITR Form 6- Part A which has 8 sub-sections and Part B which has two sub-sections. Besides, there are a number of schedules in this form.

Part A: General Information: Enter personal details like Name, Address, Email address, Aadhaar number, PAN details.

B/S: Enter the details about the balance sheet of the firm or LLP.
P&L: Enter the details of the company’s profit and loss.
Manufacturing Account: Enter the details of manufacturing account/open inventory for the year.
Trading Account: Enter the details about revenue from operations.
OI: Enter the information required in this section.
QD: Enter the quantitative details about trading & manufacturing accounts.
OL: Enter the details about the company’s receipt/payment under liquidation.

Part B

TI: Calculation of total income by summing up income from house property, gains from business, capital gains & other income and deducting the allowed deductions to calculate the taxable income.
TTI: Calculation of tax liability based on the income and applicable rate. An array of schedules come with this form. Some of the crucial ones are as follows:
Schedule HP: Enter the details about income from house property.
Schedule BP: Enter the details about income from the business.
Schedule DPM: Enter the depreciation for any machinery or/& plant possessed.
Schedule DOA: Enter the depreciation for any other assets.
Schedule DCG: Enter the details regarding capital gains from the sale, in case of sale of any depreciable asset at any point of time during the year.
Schedule CG: Enter the details regarding capital gains.

ITR-6: Return Filing

Income Tax Return-6 must be e-filed or furnished in an electronic mode, alongside The verification with Class 2 Digital Signatures, to the Income Tax Department.

Offline filing of ITR Form 6 is not permissible by the Income Tax Department.

Preparatory Actions to File ITR- 6

Keep your profit and loss statement, balance sheets and book of accounts ready.
Go through the detailed instructions to file Form 6 given on the official website of the Income Tax Department.
Be ready to fill both the parts- Part A and B along with the schedules.
Note that Form 6 is an annexure-less form so no document needs to be attached with it.
Download Form ITR-6

Steps to File ITR-6

Form 6 is downloadable from the official e-filing portal of the Income Tax department. However, it is not necessary to download the form because the income tax mandates the complete e-filing of the form in real-time along with verification using the digital signature.

Steps to e-file the Form ITR-6

Step 1: Go to the e-filing portal of the Income Tax department.
Step 2: Choose the ITR Form 6 after checking your eligibility to file this return form.
Step 3: Enter the details required in the sequence mentioned above.
Step 4: Sign the verification form using Digital Signature and Submit.

Points to ponder:

After entering the details in the Form, the tax is calculated after considering all the taxes paid in advance and once the return filing process is completed, the tax is settled which means in case of additional payment of tax, the refund is initiated by the Income Tax department.
It is only in case of Form 6 that online verification is permitted. So, the ITR-6 has to be filed online as well as verified online using a digital signature.

For a hassle-free and easy return filing, you can get in touch with us. Our competent team provides all-inclusive techno-based compliance management services that include financial statement preparation, ITR filing and MCA annual return filing.

ITR For NRI's

The taxable income of an NRI solely relies on the residential status of the person in the concerned year. If the status is – Resident then the income, earned at national or international front, of the individual will be taxable in India, whereas, in the contrast case of NRI Status, the income that is earned in India will only be taxable in India. The examples of income earned in India includes the salary earned in India by doing a job or providing services in India, capital gains on transfer of ownership of assets that are situated in India, gain from a house property located in India, income from FDs or interest on savings bank account in India. Such incomes which are earned in India are taxable income for NRIs. However, the income earned in Foreign country or outside India is not taxable in India. Interest earned on an FCNR account and NRE account is exempted from tax. Interest on NRO accounts attracts tax from an NRI.

There are so many NRI families in today’s world where a member of the family is working outside the country but sends money to his family back in India or makes investment planning for their families or their future. This raises a major concern about NRI Income tax return in India. During every tax filing season, every tax-paying citizen of the country tries to find out the best way he/she can save the total amount of income tax payable on their hard-earned money. Therefore, the NRI Income tax return works completely in favor of the NRI citizens because it allows them to bring NRI income to India, but income which is earned outside India by an NRI is not taxed in India.

Simultaneously, there are various other types of income earned by citizens that are not taxed in India. Though, most NRIs have bank accounts such as non-resident external accounts or foreign currency non-resident accounts that are used by them in India. Indian residents, however, are liable to pay tax on their savings accounts which have an interest charged above INR 10,000, but NRI residents having NRO account are not liable to pay tax on the interest that is charged on their bank accounts. Similarly, investments made by an NRI citizen are also not taxed in India.

NRI taxation rules allow people with income earned outside India to invest in the country which adds to the economy of the country and therefore is a very favorable norm. This helps the government gain investments from NRI’s without spending money on non-residents. If there are any long-term or short-term gains received from the sale of assets in the country or investments made, then the gains will be taxed in India. So, retail income is taxed in India. If an NRI inherits the property or any other kind of asset from their parents or relative, that will not be taxed in India when the ownership is being transferred. But if there are gains generated from transferred assets such as rental income or income from the sale of the asset will be taxed for the NRI citizen. Under Section 54, 54ECand 54F there are some important benefits received from deduction of income tax that can be availed if someone invests the proceedings of any type of long term or short-term capital gains in India. But if an NRIs total gains which would include earnings from all sources such as rent, dividend, capital gains, investment income, etc. exceeds INR 2.5lakh then they must file for the process of taxes.

NRI citizens are not eligible to make a certain investment such as investing in National Saving Certificates (NSC), Senior Citizen Schemes, Post Office Time Deposits, or they are also not allowed to open new PPF accounts or extend their current PPF accounts. However, a lot of other saving instrument schemes such as home loans, life insurance, pension plan, and equity-linked saving schemes for mutual funds are still allowed for NRIs to invest in. An NRI can also claim the amount of tuition fee that is paid for his spouse or children in India. Under section 80D, health insurance policies or health checkups paid by an NRI for his/her parents or dependents that are in India is allowed.

Income Tax Slabs and Rates for NRIs for FY 2020-21 & AY 2021-22

As per the Income Tax Act of India, non-resident Indians must duly pay taxes to the Indian government. But the income tax rates for NRIs are not the same as that of Indian residents. The slabs of taxes for them are mainly based on the income they have earned and not all the other factors.

For the economy of the country, taxation is a very important aspect. Taxes are levied on various products and services that are included in the supply chain of the country. Taxation helps, improve the services and products that are availed by Indian citizens. Some of the commonly known forms of taxation are income tax, service tax, property tax, and tax that is deducted at source. But NRIs mainly must only pay income tax in India.

If an NRI falls under the jurisdiction of the income tax act of 1961, they must pay the entire taxable amount to the government. The income tax act of 1961, however, provides all the details under the category of NRI taxation, explaining on what they must pay taxes and how they must pay it. The NRI taxation category gives detailed information on all types of taxes such as income tax, property tax, wealth tax, but its focus is always income tax.

Income Tax Provisions for NRIs

A person is certified as an NRI only if he checks all the guidelines and directives asserted for it. If an NRI is earning income outside India, then that income will not fall under the jurisdiction of the income tax act. However, if he/she earns an income in India through various forms such as capital gains from investment, mutual funds, sale of assets, etc and the amount of capital gains exceed the basic exemption limit that is determined in the income tax act, then they will have to file for a tax return.

As per the Income Tax Act, taxable income for NRIs is different from the income tax charged to residents of India, this difference lies between both of their tax slabs.

The main concerning points with NRI taxation is outlined as follows:

Income tax slabs are based on the income expected for any gender, age, or other specification in case of an NRI.
If there is TDS, then all the income generated by an NRI is charged irrespective of any threshold value.
Nominal deductions are not applicable to any investment income except if there are specific situations.
If an NRIs income is subject to the clause under Section 115G of the income tax act, then e filing of income tax is not required for an NRI.

There are specific provisions that are explained in the Income Tax Act that tells how income tax is chargeable for a non-resident Indian. These provisions are as follows:

Section 115D: Calculation of taxable income of NRI person
Section 115E: If income earned by NRI consist only investment income or income by way of long term capital gain then tax percentage on such income will charged at 20% rate.
Section 115F: Non-chargeable capital gains generated by an NRI through a transfer of foreign exchange assets in a few cases, – here dealing with such exceptions the transfer of foreign exchange assets will not include taxes on them.
Section 115G: This section provides exemption to NRI from filing NRI Income tax return under some cases.
Section 115H: Section provides certain benefits of taxation for an NRI when it becomes a resident.
Section 115I: Any income derived from a foreign exchange asset.

The above-mentioned rules on income tax for NRIs are subject to change depending on the direction and discretion of the Central Government and the Income Tax Department of the country.

Applicable Deductions and exemptions for NRIs

Sometimes NRIs tend to pay more tax than what they are initially liable to pay because most of their incomes are subjected to heavy TDS (Tax Deductible at Source). Therefore, it is important to know the applicable deductions and exemptions provided by the government for NRI taxation.

The deductions that are allowed for an NRI are as follows:

1. Section 80C:

Life insurance premium payment.
Payment of tuition fees.
Principal paid on the loan that was taken for house property.
Investments made in ULIPs.

Deduction is applicable from income generated from house property.

2. Section 80D:

Premiums paid on the health insurance of a family member or any other dependent up to 50,000 if parents are senior citizen and 25000 if parents are not senior citizen.
Preventive health check-ups are also deductible up to a maximum of INR 5,000.

3. Section 80E:

Interests that are paid on an education loan for the NRIs own higher education, or of his spouse and children or any dependent student is deductible to a period of 8years or until the interest is paid.

4. Section 80G:

Donations made under section 80G

5. Section 80TTA:

Interest on saving bank accounts up to the amount of INR 10,000.

Income Tax Return for Individuals