File your tax return with elan

Every person/individual or HUF (Hindu undivided family) "� an assessee of any status, as per the Income Tax Act is liable to follow a certain statutory requirements to file a return of income.

It is mandatory for everybody to enter his/her PAN (permanent account number) correctly in the return form. The 'jurisdiction menu' will help you identify your assessing officer.

When total income "� from all sources of income "� of any person exceeds the maximum amount, which is not chargeable to income tax in any previous year ending on March 31, the person is liable to file the income-tax return.

Let us highlight a few basic income heads and then various steps or the procedure of computing. Heads of income inlcude salaries, income from housing property, profits/gains of business/profession, capital gains, and income from other sources.

Computing procedure
While computing income from the above-mentioned different heads, the procedure is: First, the taxable income from each source is to be computed under each head of income by allowing deductions and then they are aggregated.

For example, in case of an assessee deriving income from his salary and housing property, and also in the form of interest income from a fixed deposit in a bank, firstly, the taxable income under the head 'salaries', then 'income from housing property', and lastly, the taxable income under the head 'income from other sources' for bank interest etc will be computed.

Then all the three incomes under the three heads would be aggregated. From this amount, certain eligible deductions are made to arrive at the net taxable income on which tax is chargeable.

Tax deducted at source
The employer making payment to an assessee earning income from 'salary' deducts a certain amount of tax, from such payment(s) made during the financial year.

Such deduction from the payment is called 'tax deducted at source (TDS)'. The payment, of TDS, to the government is treated as payment of tax on behalf of the assessee.

Advance tax
In case the assessee does not wish to furnish particulars of his income under other heads to his employer, he has to estimate his total taxable income under the different heads of income during the previous year, and pay tax on it (after excluding the TDS), by the due dates specified under the Income Tax Act. These payments are called 'advance tax payments'. 
 

TABLE I
	Due date of Installments	Amount Payable
1st	On or before Sep 15	Amount not less than 30% of such advance tax
2nd	On or before Dec 15	Amount not less than 60% of such advance tax
3rd	On or before Mar 15	Entire balance amount of such advance tax.

However, the liability for payment of advance tax arises only where the amount of such tax payable by the assesses during that year is Rs 5, 000 or more. Also, any amount paid by way of advance tax on or before the March 31 of that year, is treated as advance tax paid during that financial year.

After the return is prepared and the net taxable income finally determined, it may so happen that, after taking into account the amount of TDS and advance tax, if any, already deducted/paid still some tax or interest (payable for delay in furnishing the return or delay in payment of advance tax) remains to be paid.

This amount should be paid as 'self-assessment tax' before furnishing the return. It is, therefore, important to note that before furnishing the return, the assessee has to pay the entire tax and interest, if payable, and the proof of such tax payments has to be attached with the return.
 

TABLE II
Category	Due date
Where the assessee is a company	31st October
Where the assessee is a person other than a company:  Where the accounts of the assesee are required to be audited under any law  Where the assessee is a working partner in a firm whose accounts are  required to be audited under any law  Where the assessee is covered by the first proviso to Section 139(1)	31st October
In any other case	31st July

Penalty for non-filing of returns
A person who is required to file a return of income compulsorily is liable to a penalty of Rs 5,000 for not filing the return by the end of the assessment year concerned. However, if there is a reasonable cause, penalty may not be levied.

(The writer is head of financial planning at Sykes & Ray Equities)