1079 (Income Tax) If i use ITR 2 or ITR 4 to file return for salary income , is it wrong (Concept)? Case Methodology - Harvard Case Model Video Link - https://youtube/watch?v=_LEXMNMlzKE Narration - By Amlan Dutta Lets understand this very important concept with the help of a example ! Say the previous year is 2013 14 where i have salary income of 10 lakhs ....lets assume that i have no savings and no other income ...so my tax liability for year Previous year 2013 14 implying assessment year 2014 15 is 133900 Rs (0 for below 2 lacs , 30000 for 2-5 lakcs and 1 lac for 5 to 10 lacs plus education cess at 3 % ) So as far as the revenue is concerned , it should get from me 1.333 lacs and till the point i have defined my income properly and pay such tax they are happy ! Whether i use ITR 1 , ITR 2 etc is inconsequential as far as i have defined income head properly and arrived at my total income properly Say i have income from business profession of further 2 lacs but i could not define it because i used ITR 2 which doesnt have business head , then this is a serious problem now because clearly i have suppressed my income and the revenue will lose on tax as a result ! So anytime you select a return , your main intent should be whether the return helps you define your income heads and other cases that apply to you like double taxation , savings etc etc thinghs that play a role in computation of total income properly ! If it does , let not the barricades of income class bother you ! Rather keep the major purpose of filing return in mind which is being able to define your total income and the taxes due and then seeing whether you have that much tax credit in THAT FINANCIAL YEAR to meet that liability ...If not pay that much more tax and create that much tax credit and then mention details of such credit in your return so that the revenue knows that the taxpayer has not only defined total income properly but also has paid all taxes which are due on such total income ! In fact let me know you a secret ...i filed ITR 2 for my salary income ...if i was to hear consultants i would have filed ITR 1 which is for salary class ...but why should i care ...ITR 2 helps me show my breakup of income head more effectively and also helps me declare my exempt transport allowance comprising my salary of 9600 Rs in exempt income schedule so that the assessing officer doesnt get confused as to why i have not offered tax for such credit ! It helps me make things more transparent so i thought that ITR 2 was more apt in my case ..I didnt have that mental block that ITR 1 is for salary and so i am committing a crime!
Posted on: Sun, 14 Dec 2014 06:55:44 +0000
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