What is IT return filing?
We all have come across the word “Tax” quite a few times in our daily lives in conversations such as “ Oh no! I missed the last day for the Income Tax Return filing” or “ The It Return Filing process is so hectic” etc. And if you are a start-up, you must be aware of the importance of the necessary statutory or regulatory compliances related to taxation. So, we are here to make the it return filing process easier for you. But first let us understand what the process is all about.
Dictionary defines Tax as “ an amount of money paid to the government that is based on your income or the cost of goods or services you have bought”. They are a revenue source for government which is utilised for various purposes aimed for progress of the country. And just as the name gives away, Income Tax is a direct tax that is charged by the central government on the income of an individual or organisation(business) annually for a financial year. Through the IT return filing process, individuals or businesses reveal their total income during the financial year , i.e., from 1st April to 31st March of the next year, to the Income Tax Department. Via the It return form, the details of the income and the taxes to be paid is submitted to the IT department.
Why is IT return filing process important?
It is mandatory for an individual(if he is eligible based on his income) and a corporation to pay taxes. Default or delay in payment of Income tax or IT return filing or under reporting or false reporting of income will invite penalties (sometimes even imprisonment) imposed by the Income Tax Department, in accordance to the Chapter XXII of the Income-tax Act, 1961. You must have read at numerous instances that companies have been forced to even shut down due to the failure of complying to the laws that made ITR filing. Irrespective of income, profit or loss, all registered companies registered in India are required to file it returns every financial year.
1(innovative idea and technical knowledge)+1(potential investment)=1(statutory and regulatory compliances )=5(sound and flourishing business)
IT return filing process online
To make it easier of the Taxpayers, the Income Tax Department allows ITR to be filed online by using their e-filing portal. It is mandatory under the Companies Act, that an annual RoC along with Form 20B, 23AC, Form 23ACA is filed by the companies to avoid penalties. The company also needs to choose the correct ITR form to be filled. Under the StartUp India policy, eligible start-ups who get certified by Inter-Ministerial Board (IMB) are exempted from tax for a period of the first three out of ten years.
IT return filing process Documents Required
- One needs to fill up the correct ITR form
- Submit loan documents if any (that can help to claim for a rebate)
- A balance sheet of financial transactions during the financial year
- Records of any audits if applicable
- Bank statements
- Details of Investments
- Previous documents of previously paid income tax document
Get A Free Consultation For Our IT Return Filing Online
Frequently Asked Questions for IT return filing Services For Startups
Why is IT return filing important?
The following reasons show why it is important to file IT return:
- There are penalties for not filing IT return
- Helps to carry forward losses to subsequent years
- Helps to avail loans and bank credits easily
- Helps to ensure a good reputation of the company
- Helps to authenticate the credit worthiness of the company before financial institutions
- Helps to stay clean during financial due-diligence and so helps to gain the confidence of investors
How to check income tax return filing status?
One can check the ITR status online on the e-filing website.
- Go to the e-portal of the Income Tax Department (https://eportal.incometax.gov.in/iec/foservices/#/login )
- Login to the website and under the Quick Links Option you can see the Income Tax Return (ITR) Status.
- After clicking in it and filling up the necessary details, the status will be shown.
What are the modes for filing of return of income?
ITR can be filed both online and offline. The online process is more user friendly and can be accessed from anywhere at any time.