Income Tax Return: Most of the people do not know that it is necessary to show the interest received on their savings account as earnings in ITR. This is where they make mistakes.
New Delhi: Income Tax Return: Filing of Income Tax Return (ITR) is mandatory for all those whose annual income is more than Rs 2.5 and age is less than 60 years. The government has exempted senior citizens whose annual income is less than Rs 3 lakh from filing Income Tax Return (ITR). Super senior citizens i.e. those who are above 75 years of age need not file ITR, provided their source of income is only pension and interest on deposits.
Do not make these mistakes in ITR filing
The deadline for filing income tax returns for the financial year 2020-21 (AY 2021-22) is September 30, 2021. Even if this deadline extends further, taxpayers should file their returns this month. Because it is better to get rid of this responsibility as soon as possible. But it is very important to keep some important things in mind while filing ITR. Because some small mistakes can become big trouble later. So these mistakes should be avoided.
1. It is necessary to show the interest received on the savings account
Most of the people do not know that the interest received on their savings account is required to be shown in ITR as earnings. This is where they make mistakes. Under Section 80TTA of Income Tax, interest earned on savings accounts for individuals up to Rs 10,000 is exempt. For senior citizens, this exemption under section 80TTB is Rs 50,000. More than this interest earning has to be shown in ITR.
2. It is necessary to show the interest received from FD
Under the Income Tax Act, interest earned on fixed deposits is taxable. Hence it is necessary to show this interest in ITR.
3. Filling of Wrong ITR Form
There are different ITR forms depending on the source of income. Therefore, it is important that you choose the right income tax return form according to your source of income.
4. Forget e-Verification
It is often seen that after filing ITR, people think that the work is done, whereas after that e-verification is also mandatory. E-verification is required to be done within 120 days of filing ITR. If you do not do this then your ITR is affected. There are several methods of e-verification. You can complete this through Net Banking Account, Aadhaar OTP.
5. Not understanding the new and old tax system
The government has also implemented a new tax system. In the old tax system, you get deduction and exemption, but in the new tax system, you do not get deduction and exemption but the tax rate is less. In both these tax systems, you should compare which one is more beneficial for you, that is, in which you will save more tax. Only then file the tax return.
6. Dividend income not disclosed
Earlier, dividend earning from equities or mutual funds was considered tax free. But from the financial year 2020-21, if an individual has earned through dividends from equity and mutual funds, then it will be taxed as per the tax slab. Therefore, this year you are also required to show dividend income in ITR.
