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Income Tax Return Filing ITR-5

ITR-5 is crucial for specific taxpayers for simplified filing. Choose the right form based on income source, submit before the deadline. It streamlines the process for efficient Income Tax Department compliance.

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Overview

  • This Income Tax Return (ITR) form, specifically ITR-5, is designed for entities such as businesses, limited liability partnerships (LLPs), associations of people (AOPs), bodies of individuals (BOIs), artificial judicial persons (AJPs), estates of the recently deceased and insolvent individuals, business trusts, and investment funds. Here are some important details about ITR-5 and notable changes for the Assessment Year 2021-22:

    Notable Changes in ITR-5 for AY 2021-22:
    1. Investments in Unlisted Equity Shares:
    Information about investments in unlisted equity shares needs to be provided, including details such as the share's name, the type of company it belongs to, changes in the investment during the financial year, and your PAN.

    2. Schedule 112A for Business Trusts:
    Introduction of Schedule 112A to calculate long-term capital gains on the sale of stocks of a business trust that are subject to the securities transaction tax (STT).

    3. Tax Deduction Claims under Chapter VIA:
    Specifics are required for tax deduction claims under Chapter VIA of the Income Tax Act for investments or expenditures incurred between April 1, 2020, and June 30, 2020. This includes deductions under Article 80C (LIC, PPF, NSC, etc.), 80D (health insurance), and 80G (donations).

    4. Detailed Information Required:
    Information needed includes recognition as a start-up company from DPIIT (Department for Promotion of Industry and Internal Trade), Form-2 declaration for partnership firms, and information related to cash and other payment methods for gifts, gross GST receipts, and revenue.

    ITR-5 Form's Structure:
    The ITR-5 form consists of multiple schedules and two main parts:

    Part A: Provides background information.
    - As of March 31, 2019, the balance sheet is included in Part A.
    - Trading Account for FY 2018-19 in Part A.
    - Manufacturing Account for FY 2018-19 in Part A.
    - Part A - P&L: Profit and Loss Account for FY 2018-19.
    - Quantitative information is in Part A.
    - Other Information (Part A-OI).

    Please note that the ITR forms can be complex and may require a good understanding of tax laws and financial reporting. It's advisable to consult a tax professional or financial advisor to ensure accurate and compliant filing.

There are about 31 schedules included with these parts, and they are described here:

  • - Schedule HP: Income calculation for House Property.
    - Schedule DPM: Depreciation calculation for machinery and plant.
    - Schedule BP: Business or profession income computation.
    - Schedule DOA: Depreciation on other assets.
    - Schedule DCG: Deemed capital gains on depreciable property sale.
    - Schedule DEP: Depreciation summary for all assets.
    - ESR Schedule: Deduction for scientific research expenditure (Section 35).
    - Schedule OS: Income calculation from other sources.
    - Schedule CG: Capital gains computation.
    - Schedule CYLA: Income after offsetting current-year losses.
    - Schedule CFL: Declaration of carried forward losses.
    - Schedule BFLA: Income after adjustment of unabsorbed losses from prior years.
    - Schedule UD: Unabsorbed depreciation.
    - Schedule 10AA: Deduction calculation under Section 10AA.
    - Schedule ICDS: Impact of income computation disclosure standards.
    - Schedule 80G: Details of eligible donations (Section 80G).
    - Schedule RA: Donations to research associations.
    - Schedule 80GGA: Donations for scientific or rural development.
    - Calculation of deductions under Schedules 80IA and 80IB.
    - Schedule 80P: List of deductions under Section 80P.
    - Calculation of deductions under Schedules 80IE or 80IC.
    - Schedule VIA: Statement of deductions under Chapter VIA.
    - Tax credit computation (Schedule 115JD).
    - Schedule AMT: Calculation of alternative minimum tax (Section 115JC).
    - Schedule SI: Income chargeable at a special rate.
    - Schedule EI: Exempt or non-total income.
    - Schedule IF: Details of partnerships.
    - Schedule PTI: Pass-through income from trusts/funds.
    - Schedule TR: Tax relief claims for foreign taxes.
    - Schedule ESI: Foreign income and tax benefits.
    - Schedule GST: Gross receipts and turnover for GST.
    - Schedule FA: Foreign assets and earnings disclosure.
    - Calculation of total income tax (Part B).
    - Calculation of total revenue (Part B).
    - Tax Payments: Self-assessment and advance tax payments.
    - Information gathered at source: TDS details (besides salaries).

How can you file ITR Form 5?

  • Submitting an ITR 5 form online through the Income Tax Department's website can be done in two ways:

    1. Using Digital Signature:
    - Electronically submit the return with your digital signature.
    - The acknowledgment will be sent to your registered email address.
    - No need to send physical copies in this case.

    2. Verification through Physical Copy:
    - Send the information online and then submit the ITR-5 form for verification.
    - Print copies of the filed ITR 5.
    - Sign and mail the second copy to Post Bag No.1, Electronic City Office, Bengaluru - 560500.
    - Keep one copy for your records.

Here's a simplified guide on completing the verification process for the ITR-5 form:

1. Complete Relevant Information: Fill in the verification section with the necessary details. Remove any irrelevant information or sections from the form.

2. Sign the Verification: Before submitting the return, ensure that the verification section has been signed by the appropriate individual.

3. Select Role or Designation: Indicate the role or designation of the person signing the return (e.g., Director, Partner, Authorized Signatory).

4. Beware of Fraudulent Activities: Be aware that filing a fraudulent return or attaching false schedules is illegal. Such actions are subject to prosecution under Section 277 of the Income-tax Act of 1961, which can result in severe penalties including imprisonment and fines.

5. No Attachments Needed: ITR-5 should not have any attachments, including TDS certificates. The Income Tax Department removes and returns all papers attached to the return form.

6. Match with Form 26AS: Ensure that the Tax Credit Statement on Form 26AS matches the taxes deducted, collected, and paid on your behalf. This helps avoid discrepancies.

Who is Not Required to File ITR-5 Form:
- Individual assesses
- Hindu Undivided Family (HUF)
- Company
- Taxpayers required to file Form ITR-7 returns under Sections 139(4A), 139(4B), 139(4C), 139(4D), or 139(4E) (4F).

Filing ITR-5:
- File your ITR-5 online for a quick and convenient process.
- Ensure you file before the deadline to avoid penalties.

Remember, accurate and timely filing of your ITR-5 is essential to fulfill your tax obligations and avoid any legal consequences.

FAQ

Frequently Asked Questions

You must submit your ITR-V to CPC within 120 days of filing your tax return. If not, the return filing procedure will not be finished, and your return will be deemed never to have been filed.
Step 1: Visit the www.incometax.gov.in website for income tax India and log in. Step 2: To view e- filed tax returns, choose the "e-File">"Income Tax Returns">"View Filed Returns" option. Step 3: To download the ITR-V, select the appropriate assessment year's "Download Form" button. It will download the ITR-V.
If you filed your income tax return electronically, don't forget to mail your Income Tax Verification form (ITR-V) to "Income Tax Department-CPC, Post Bag No. 1, Electronic City Post office, Bengaluru, 560010". 9) For e-Returns submitted without a Digital Signature, an ITR-V filing is required.
Your income tax return will be invalid or void if you don't submit your ITR-V within 120 days. The Income Tax Department will interpret this to suggest that you have not yet submitted your IT return.
The Income Tax Act separates an assessee's taxable income into five categories or heads of income to determine their tax due. After salaries and rental property revenue, business profits are the third kind of income under the Act.
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