ITR filing FY 2020-2021: Just 3 days left for filing returns; here are things to keep in mind

ITR filing FY 2020-2021: Just 3 days left for filing returns; here are things to keep in mind

ITR filing FY 2020-2021: Just 3 days left for filing returns; here are things to keep in mind

Filing Income Tax Returns (ITR) are a tough task for people who are not well versed with the procedure. If the correct procedure is not followed and incomplete information is given, then there is a high chance of getting the entire process wrong.

For the financial year 20-21, the due date for filing the ITR is 31 December, 2021. Both online and offline options are provided by the government for filing the ITR. Not filing the tax return will attract a penalty.

It is recommended that people who are filing their ITR must gather all the required information in advance before they begin the filing procedure.

Here's some points to keep in mind before filing your ITR:

  1. ITR filing dates

While 31 December, 2021 is the due date of filing the Income Tax Return for FY 2020-2021, the last day for the same is 31 March, 2022. It is recommended that one should make his/her personal deadline for filing by the beginning of March. This helps an individual to arrange the needed documents.  Last-minute filing could also result in unnecessary errors.

  1. Who is liable to file ITR?

People who are below 60 years of age and have a total income exceeding Rs 2.5 lakh in a financial year (excluding exemptions and deductions) need to file their tax returns.

For people between 60 to 80 years, the income limit set by the government is Rs 3 lakh. For people above the age of 80 years, the income limit is Rs 5 lakh.

  1. How people with low income avoid TDS?

People who have low income can fill forms - 15G and 15H - to avoid deduction of TDS. The forms can be submitted to banks, requesting them to not to deduct TDS on interest incomes as their earning is below the basic exemption limit.

  1. How to prepare for filing ITR

Salaried individuals can request Form 16 from their employer. Professional freelancers with a turnover of above Rs 50 lakh can file a simple form.

  1. Important documents to keep ready

Individuals must keep all the below documents ready before filing the ITR. It will help them to speedup the form filing procedure.

The documents are:

  • Form 26AS- available on income tax website
  • Form 16
  • Bank Statements for the year
  • Capital Gains Statement for Mutual Funds
  1. Common mistakes to avoid

The most common mistake is not mentioning certain incomes like the rental income or forgetting to claim deductions from their employer. Another common mistake is to avoid giving wrong bank information.

  1. ITR filing new rules

As per the new regulation, the dividend income is also taxable and the company is not liable to pay for the dividend. TDS is only applicable if the dividend income exceeds Rs 5,000.

  1. Tax on cryptocurrencies and US Capital

It is to be noted that cryptocurrencies are not part of the exemption list. Individuals can report US Capital gains under the Capital Gains Section.

  1. Best way for tax saving

To maximise their tax benefit, one should structure his/her salary in a proper manner and also claim all the deductions.

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