Income Tax Return Checklist
Tax season is approaching, and it’s crucial to be prepared to avoid the last-minute hassle and ensure that you’re correctly reporting tax benefits and claims while maintaining proper documentation. Here is a comprehensive ten-point checklist to help you prepare for a hassle-free tax compliance.
ITR Form Selection
Choosing the right Income Tax Return (ITR) form is essential for the Financial Year (FY) 23-24 to ensure hassle-free tax compliance. Here’s a summary of the criteria to select the appropriate ITR form.
Residential Status Determination
Your residential status determines the scope of income, applicable tax rates, and eligible tax treaty benefits. Here’s how to determine your residential status based on your physical presence in India.
Tax Regime Selection
Evaluate whether to opt for the new default tax regime or stick with the earlier regime before filing your ITR. Ensure to fill out Form 10IE if you opt-out of the new regime and have a business income.
Download 26AS and AIS
Download the latest updated Annual Information Statement (AIS) and Form 26AS for the FY 2023-24 to cross-verify your income and credit of taxes claimed in your tax return.
Documentation for Income Sources
Key supporting documents should be maintained, including Form 16 and 12 BA for salary income, bank and demat account statements, dividend and interest certificates for investment income records, rental agreement, and bank statement for rental income, expense records, income invoices and bank statements for business income.
Clubbing of Family Members’ Income
If you have minor kids who have any income from investments, don’t forget to have their income documents and club their income in your return. Also, keep track of your spouse’s income from gifted assets and consider this in your return.
Deductions and Exemptions
Retain receipts for tax deductions under your chosen regime, insurance premiums, donations, and investments including PPF, ELSS, NPS. Preserve purchase deeds and reinvestment proofs for capital gains exemptions.
Foreign Tax Credit and Tax Residency Certificate
Claim credit for foreign taxes on your doubly taxed foreign income. Evaluate timely filing of Form 67 along with foreign tax payment proofs. For non-residents, ensure obtaining a tax residency certificate from Foreign Regulators and evaluate filing of Form 10F to claim treaty benefits.
Details to Complete Key Schedules
Details of assets and liabilities are needed if your income exceeds ₹50 lakh. Disclose directorship details and any unlisted equity shares owned during the year. For schedule FA, mandatory for ordinary residents, detail foreign assets and income, including jointly owned properties, properties with beneficial interest, signatory in foreign bank accounts, and foreign trusts.
Stay Proactive, Stay Informed
This checklist can help you prepare for timely tax filings and enable you to navigate the filing process smoothly. Stay informed and approach the tax season with confidence!
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Disclaimer:
Estabizz Fintech compiled the material in this article using the most recent Acts, Rules, Circulars, Notifications, Provisions, Press Releases, and material applicable at the time. They ensured the completeness and correctness of the material through due diligence. When using this material, users must consult the relevant, applicable legislation. The given data may change without prior notice and does not constitute professional advice. Estabizz Fintech disclaims all liability for any results from the use of this material.