Gopabandhu Mohapatra
Some people raise the question ‘Why should I pay tax? They argue: I got employment or do business and work hard to earn. I have to pay for my food, for my house, for my travel, for my medical treatment, for owning a vehicle and what not. Developed countries like USA and UK, the people get social security including medical facilities virtually without any cost.
But in India, Tax is the fees we pay to the government, out of our earnings for using the resources of the country. Though people feel bad about paying tax, it is actually a good thing to do. Our tax provides government the resources with which it can develop our country, provide basic amenities and also protect us from invasions. Thus on considering the responsibility of the Government, we need to appreciate that we must pay tax as per law. We have to act like a responsible citizen.
However, a tax payer in general feels that taxes are a burden and it is human tendency to avoid payment of tax or at least minimise the tax liability. Hence, it is preferred to keep away from the tax department and as a result the number of non-filers of tax returns are increasing.
It is essential that those having taxable income should certainly declare the income, pay income tax and furnish the Income tax return within prescribed time.
Going through the provisions of Income Tax Act, Income is taxable under various heads like: Salary, House Property, Business or Profession, Capital Gain and Other Sources. Income Tax is to be paid if Income exceeds Basic Exemption Limit.
When it comes to filing of income tax return, the most common view is that – My employer has deducted tax at source on the salary income received by me hence I don’t need to file my income tax returns.
It is essential that every Taxpayer should verify his Form 26AS, which provides the Information regarding the TDS, Advance Tax paid and details of refund. You may get notice if the Income mentioned in Form 26AS and the Income Tax Return filed is having difference. Advance Tax is to be paid if Tax Liability during the year exceeds Rs. 10,000. E-filling of return is compulsory if income exceeds the minimum exemption limit.
Delayed tax refunds can be frustrating. After all, what can be worse than waiting for your own money to come back to you? This is why financial advisers suggest planning one’s taxes well in advance and avoid overpayment. The start of the financial year is, perhaps, the best time to do so. In case of income from Interest, submit the Forms 15G or 15H right away to avoid the tax deducted at source (TDS) on your investments, if your income is below the exemption limit.
Are you required to file Income Tax Return ?
While talking to some of my colleagues and friends who are salaried, I understand that majority of them are under the impression that as full tax has already been deducted from their salary, they are not required to file their income tax returns. This is not correct as discharge of tax liability and the liability to file your income tax return are two different and distinct liabilities and you need to discharge both the liabilities.
- As per the income tax law you are required to file your income tax return if your gross total income exceeds the basic exemption limit.
- If tax has been deducted from your income, then you must file income tax return to avoid notice from the income tax department as it has information about your income.
- If you have been filing your income tax return during the previous years, then it is advisable that you file income tax return for the current financial year also even though you may not be liable – just to avoid a notice from the income tax department.
- E filing of Income Tax return is compulsory if you want to claim income tax refund.