Most of us collate all information relating to our annual income, investments and tax deducted at source (TDS) before proceeding to file our income tax returns. However, the income tax filing process is a fairly comprehensive exercise. We might miss disclosing an income due to oversight, or claim an exemption or deduction that is not due. What are the options available to us if we make a mistake while filing returns?
We may make an error due to insufficient information or mis-match between Form 16 / Form 16 A and Form 26 AS or any other reason. Errors may also occur in our calculation. The income tax law allows us to file a revised return, correcting the omission or mistake made by us in the original return.
Filing a revised return
You can file a revised return at any time before the end of the assessment year, or before completion of the assessment, whichever is earlier.
For example, for the AY 2019-20, you can file a revised return till 31 March 2020. However, if your assessment is concluded before that date, you cannot file a revised return after completion of your assessment. An income-tax assessment is made through a notice issued by the assessing officer where your income and taxes are determined through assessment proceedings. In some situations this assessment may be completed before the end of the assessment year. If this is the case, you can no longer revise your return.
The revised return has to be filed in the same manner as an original return. While filing, a taxpayer has to choose the option: ‘Revised u/s 139(5)’. A taxpayer has to quote the acknowledgement number and date of filing of the original return while filing the revised return. The revised return substitutes the original return.
You may have filed an original return within the due date, or you may have filed after the due date. A return filed after the due date is called a ‘belated return’. You can revise both—a return filed within the due date or a belated one. The time limit for revising is the same for both as discussed above, i.e., before the end of the assessment year or before completion of assessment, whichever is earlier.
You can revise your income tax return any number of times. However, you are required to mention the acknowledgement number of the original return filed. You must note that ‘revised return’ is an opportunity for revision allowed by the income tax department. Hence, one must not misuse it and revise a return only in the case of a mistake or omission in the original return filed. If you are making errors with revisions, it’s in your interest to seek professional help for your return filing.
As is done with an original return, do remember to e-verify your ‘revised return’ as well. Your ‘revised return’ would not be valid if the same is not e-verified. You can e-verify the ‘revised return’ using an OTP (one-time password) based on Aadhaar or net banking or EVC (electronic verification code). You can also send a signed copy of the ITR V to the Centralized Processing Centre, Bengaluru, within 120 days of filing the ‘revised return’.
Highlights 1. The finance ministry has extended the deadline for filing income tax return 2. New deadline for ITR submission for FY 2018-19 extended to August 31 3. This year CBDT had extended the deadline for employers to file their TDS returns 4. If the ITR is filed between January 1 and March 31, then late filing fees of Rs 10,000 will be levied
The finance ministry has extended the deadline for filing income tax return (ITR) for FY2018-19 by individuals to August 31, 2019 from July 31, 2019. The extension is a much needed relief as there were multiple problems being faced by individuals in filing returns by July 31. July 31 was the deadline to file income tax returns for most individuals and HUFs. This is that category of individuals and HUFs who are not mandatorily required to get their accounts audited for tax purposes.
Many chartered accountant/tax practioner societies had appealed to the government to extend the ITR filing deadline to provide sufficient time to individuals to file ITR properly. There are many reasons for this.
This year CBDT had extended the deadline for employers to file their TDS returns, i.e., Form 24Q, from May 31, 2019 to June 30, 2019 and consequently deadline of issuing Form 16 by the employer was also extended from June 15, 2019 to July 31, 2019. Consequently, employees wait employees waiting to get their Form 16s to file their ITRs were left with only 21 days to file their tax return by the earlier deadline of July 31.
If the ITR is not filed by an individual before the expiry of the deadline, which is usually July 31, then the individual would have to pay a late filing fee of Rs 5,000, if filed by December 31. If the ITR is filed between January 1 and March 31, then late filing fees of Rs 10,000 will be levied.
With extension of the deadline, individuals will have more time to file their ITRs without worrying about late filing fees.
Even though it is easier to fill salary details in ITR-1 this year as individuals are required to just copy-paste the same from Form 16, sources of interest income are required to be provided in greater detail. This could be a tedious process.
Further, while the tax department has started providing pre-filled XML for ITR forms 1 to 4, the pre-filled XML file for ITR-2 does not contain salary details which individuals have to fill-in by themselves. ITR-2 asks individuals to provide detailed break-up of salary such as basic, HRA and so on received by choosing the options from the drop-down menu.
The calculation of long-term capital gains (LTCG) tax on equity shares and equity mutual funds is also a complicated process due to the grandfathering clause which came into effect from FY2018-19 onwards. In addition to that, individuals were also required to provide details such as ISIN code/Folio number, name of shares/units and so on for sale of equity shares and equity mutual funds. However, later on this was made optional.
GST Council has considered the implementation experience of the last 3 months and gave relief to small traders, says Arun jaitley.
More than three months after the Goods and Services (GST) was introduced, the GST Council made a number of big changes today, to give some relief to small and medium businesses (SMEs) on filing and payment of taxes. The panel also eased rules for exporters and cut tax rates on some items. Those businesses with annual turnover of up to Rs 1.5 crore and which constitute 90 percent of the taxpayer base but pay only 5-6 percent of overall tax, have been permitted to file quarterly income returns. “GST Council has considered the implementation experience of the last 3 months and gave relief to small traders… Compliance burden of medium and small taxpayers in GST has been reduced,” Finance Minister Arun Jaitley said. The SMEs had earlier complained of tedious compliance burden under the new regime. Below is the full text of the recommends made by GST today:
The GST Council, in its 22nd Meeting which was held today in the national capital under Chairmanship of the Union Minister of Finance and Corporate Affairs, Shri Arun Jaitley has recommended the following facilitative changes to ease the burden of compliance on small and medium businesses:
Composition Scheme
1. The composition scheme shall be made available to taxpayers having annual aggregate turnover of up to Rs. 1 crore as compared to the current turnover threshold of Rs. 75 lacs. This threshold of turnover for special category States, except Jammu & Kashmir and Uttarakhand, shall be increased to Rs. 75 lacs from Rs. 50 lacs. The turnover threshold for Jammu & Kashmir and Uttarakhand shall be Rs. 1 crore. The facility of availing composition under the increased threshold shall be available to both migrated and new taxpayers up to 31.03.2018. The option once exercised shall become operational from the first day of the month immediately succeeding the month in which the option to avail the composition scheme is exercised. New entrants to this scheme shall have to file the return in FORM GSTR-4 only for that portion of the quarter from when the scheme becomes operational and shall file returns as a normal taxpayer for the preceding tax period. The increase in the turnover threshold will make it possible for greater number of taxpayers to avail the benefit of easier compliance under the composition scheme and is expected to greatly benefit the MSME sector.
2. Persons who are otherwise eligible for composition scheme but are providing any exempt service (such as extending deposits to banks for which interest is being received) were being considered ineligible for the said scheme. It has been decided that such persons who are otherwise eligible for availing the composition scheme and are providing any exempt service, shall be eligible for the composition scheme.
3. A Group of Ministers (GoM) shall be constituted to examine measures to make the composition scheme more attractive.
Relief for Small and Medium Enterprises
4. Presently, anyone making inter-state taxable supplies, except inter-State job worker, is compulsorily required to register, irrespective of turnover. It has now been decided to exempt those service providers whose annual aggregate turnover is less than Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) from obtaining registration even if they are making inter-State taxable supplies of services. This measure is expected to significantly reduce the compliance cost of small service providers.
5. To facilitate the ease of payment and return filing for small and medium businesses with annual aggregate turnover up to Rs. 1.5 crores, it has been decided that such taxpayers shall be required to file quarterly returns in FORM GSTR-1,2 & 3 and pay taxes only on a quarterly basis, starting from the Third Quarter of this Financial Year i.e. October-December, 2017. The registered buyers from such small taxpayers would be eligible to avail ITC on a monthly basis. The due dates for filing the quarterly returns for such taxpayers shall be announced in due course. Meanwhile, all taxpayers will be required to file FORM GSTR-3B on a monthly basis till December, 2017. All taxpayers are also required to file FORM GSTR-1, 2 & 3 for the months of July, August and September, 2017. Due dates for filing the returns for the month of July, 2017 have already been announced. The due dates for the months of August and September, 2017 will be announced in due course.
6. The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-section (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by a committee of experts. This will benefit small businesses and substantially reduce compliance costs.
7. The requirement to pay GST on advances received is also proving to be burdensome for small dealers and manufacturers. In order to mitigate their inconvenience on this account, it has been decided that taxpayers having annual aggregate turnover up to Rs. 1.5 crores shall not be required to pay GST at the time of receipt of advances on account of supply of goods. The GST on such supplies shall be payable only when the supply of goods is made.
8. It has come to light that Goods Transport Agencies (GTAs) are not willing to provide services to unregistered persons. In order to remove the hardship being faced by small unregistered businesses on this account, the services provided by a GTA to an unregistered person shall be exempted from GST.
Other Facilitation Measures
9. After assessing the readiness of the trade, industry and Government departments, it has been decided that registration and operationalization of TDS/TCS provisions shall be postponed till 31.03.2018.
10. The e-way bill system shall be introduced in a staggered manner with effect from 01.01.2018 and shall be rolled out nationwide with effect from 01.04.2018. This is in order to give trade and industry more time to acclimatize itself with the GST regime.
11. The last date for filing the return in FORM GSTR-4 by a taxpayer under composition scheme for the quarter July-September, 2017 shall be extended to 15.11.2017. Also, the last date for filing the return in FORM GSTR-6 by an input service distributor for the months of July, August and September, 2017 shall be extended to 15.11.2017.
12. Invoice Rules are being modified to provide relief to certain classes of registered persons.
Recommendations made by the GST Council in the 21st meeting at Hyderabad on 9th September, 2017
Press Information Bureau
Government of India
Ministry of Finance
09-September-2017 20:19 IST
The GST Council, in its 21st meeting held at Hyderabad on 9th September 2017, has recommended the following measures to facilitate taxpayers:
a) In view of the difficulties being faced by taxpayers in filing returns, the following revised schedule has been approved:
Sl. No.
Details / Return
Tax Period
Revised due date
1
GSTR-1
July, 2017
10-Oct-17
For registered persons with aggregate turnover of more than Rs. 100 crores, the due date shall be 3rd October 2017
2
GSTR-2
July, 2017
31-Oct-17
3
GSTR-3
July, 2017
10-Nov-17
4
GSTR-4
July-September, 2017
18-Oct-17 (no change)
Table-4 under GSTR-4 not to be filled for the quarter July-September 2017. Requirement of filing GSTR-4A for this quarter is dispensed with.
5
GSTR-6
July, 2017
13-Oct-17
Due dates for filing of the above mentioned returns for subsequent periods shall be notified at a later date.
b) GSTR-3B will continue to be filed for the months of August to December, 2017.
c) A registered person (whether migrated or new registrant), who could not opt for composition scheme, shall be given the option to avail composition till 30th September 2017 and such registered person shall be permitted to avail the benefit of composition scheme with effect from 1st October, 2017.
d) Presently, any person making inter-state taxable supplies is not eligible for threshold exemption of Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) and is liable for registration. It has been decided to allow an exemption from registration to persons making inter-State taxable supplies of handicraft goods upto aggregate turnover of Rs. 20 lacs as long as the person has a Permanent Account Number (PAN) and the goods move under the cover of an e-way bill, irrespective of the value of the consignment.
e) Presently, a job worker making inter-State taxable supply of job work service is not eligible for threshold exemption of Rs. 20 lacs (Rs. 10 lacs in special category states except J & K) and is liable for registration. It has been decided to exempt those job workers from obtaining registration who are making inter-State taxable supply of job work service to a registered person as long as the goods move under the cover of an e-way bill, irrespective of the value of the consignment. This exemption will not be available to job work in relation to jewellery, goldsmiths’ and silversmiths’ wares as covered under Chapter 71 which do not require e-way bill.
f) FORM GST TRAN-1 can be revised once.
g) The due date for submission of FORM GST TRAN-1 has been extended by one month i.e. 31st October, 2017.
h) The registration for persons liable to deduct tax at source (TDS) and collect tax at source (TCS) will commence from 18th September 2017. However, the date from which TDS and TCS will be deducted or collected will be notified by the Council later.
The GST Council has decided to set up a committee consisting of officers from both the Centre and the States under the chairmanship of the Revenue Secretary to examine the issues related to exports.
The GST Council has also decided to constitute a Group of Ministers to monitor and resolve the IT challenges faced during GST implementation.
The Income Tax Department’s time series data of direct taxes for 2016-17 estimates the government has collected ₹8,49,818 crore as income tax on individuals and businesses, recording a 14.5 per cent growth, the highest rise since 2013-14.
Personal income taxes rose 21.4 per cent, but taxes on corporate incomes grew more slowly at 7 per cent.
The biggest rise was reported under the head of ‘other direct taxes’, which includes collections on account of Income Declaration Scheme 2016 and Pradhan Mantri Garib Kalyan Yojana 2016, schemes for declaring previously undisclosed income. Collections under this head is estimated to have risen 1,348 per cent to ₹15,624 crore.
The sharper rise in personal income taxes has also meant its share in the direct tax collection has increased to over 40 per cent for the first time since 2002-03 and the share of taxes on corporate incomes have fallen below 60 per cent. These estimates are based on provisional data, which the department has extracted from Online Tax Accounting System (OLTAS) and Principal Chief Controller of Accounts under the Central Board of Direct Taxes, and are bound to be revised after the returns for the last fiscal year is reconciled.
Saturday August 5 was the last day for filing of returns by those who are not required to get their accounts audited. Others can file their returns before March 31, 2018, for incomes earned in 2016-17.
Total tax collection
The growth in direct tax collections notwithstanding, its share in total tax collection has fallen below 50 per cent for the first time in 10 years. The share of direct taxes in the total taxes was estimated at 49.7 per cent for 2016-17, after staying well above 50 per cent between 2007-08 and 2015-16. This reversal in trend may be attributed to increase in collection under service tax.
The time series data also estimates that the gross tax receipts before reducing refunds made through the year rose 17 per cent to ₹10,12,506 crore, the highest jump seen since 2010-11. This included a 24 per cent jump in self-assessment tax (a bulk of which is taxes paid by unincorporated businesses), 14 per cent rise in tax deducted at source (TDS) and 15 per cent increase in advance tax payments.
Incidentally, TDS growth has slowed from 22 per cent reported for 2015-16, while advance tax payments growth has risen from 9 per cent reported then. TDS accounted for 36 per cent of the taxes collected in the last fiscal year and advances taxes accounted for 41 per cent. Income tax laws require a bulk of the taxes on incomes of individuals and businesses to be paid in advance on a quarterly basis.
The Income Tax Department has estimated the number of assesses for 2016-17 at 6.27 crore, of which about 95 per cent or 5.93 crore were individual assessees. The number of assessees grew just about 2 per cent from 2015-16.
On State-wise basis, Maharashtra continued to contribute a bulk of the direct taxes, accounting for about 37 per cent of the collection. Delhi accounted for 12.8 per cent of the taxes collected and Karnataka about 10.1 per cent.
Challenge before taxmen is to widen tax net and officials are working towards it
Income taxpayer base moved up substantially to 6.26 crore at the end of the last fiscal, from nearly 4 crore earlier, CBDT Chairman Sushil Chandra said on Monday.
Clearing the air on disclosure of bank account details of non-resident Indians (NRIs), expats, as well as foreigners with investments in private equity in India, Chandra also said that such accounts need to be disclosed only when a refund is due to the assessee.
The chairman of the Central Board of Direct Taxes (CBDT) said that post demonetisation the department has taken a host of measures to increase tax base and the statement of financial transaction (SFT) report filed by banks shows widening of taxpayer base.
“As on date, we have got 6.26 crore assessees. It is a myth that we have 3-4 crore… (These) assessees who have filed returns, paid advance tax or tax has been deducted at source. This is a large jump from earlier years,” he said speaking at the Income Tax Day celebrations here.
The challenge before the taxmen now remains how to widen the tax net and officials are working towards it, he said.
Chandra said that with the enactment of the amended Benami law, the tax officials have found out clusters and persons who have invested money in real estate without filing tax returns.
The department has also taken enforcement action and under the law, 233 properties has been attached.
With regard to reports on NRIs having to disclose overseas bank account details in tax returns, Chandra said “providing bank account detail is optional and only has to be provided for claiming refunds”.
The tax department, he said, will now start working on expanding the process of e-assessment, he said, adding so far limited scrutiny cases are done using technology in 7 cities.
“We are working on the strategy that within two months we will spread limited scrutiny to 100 cities. Limited scrutiny cases which are selected should be done through systems,” he said.
If a case is selected under ‘limited scrutiny’, it means a limit has been set on the enquiries which will only pertain to mismatch or inaccurate reporting. When a tax income- expenditure profile does not match, the department’s automated system throws up a case for limited scrutiny.
Chandra said the next step would be to undertake complete scrutiny on systems so that assessees don’t have to visit tax office. “That will be big challenge and we are working on that,” he said.
Revenue Secretary Hasmukh Adhia said that with the linking of PAN with Aadhaar the entire era of bogus bank account and holding multiple PAN will go away.
He said of the last 25 years, in 11 years the Income Tax department has achieved a growth rate of 20 per cent and even a growth rate of 30 per cent in the year after demonetisation is considered modest.
The government hopes to mop up Rs 9.8 lakh crore from direct taxes in the current fiscal.
The income-tax (I-T) department has asked large corporate entities, including multinational firms, to furnish details of employees off the payroll to check whether they are filing tax returns after deduction at source, or TDS.
According to I-T officials, many lawyers, chartered accountants, consultants, and designers — not on the payroll of companies — have not filed I-T returns (ITR), fearing they would have to disclose their full income.
The move is part of the government’s efforts to increase the tax base and nab potential evaders. The deadline for filing returns for the assessment year (AY) 2017-18, to track income in the fiscal year 2016-17 (FY17), is July 31.
Such professionals who could be potential evaders have been identified through a complete tax profiling, by linking their banks and transaction details.
The tax department, through its non-filer monitoring system, has identified about 13.7 million people with potential tax liabilities who have not filed returns. A preliminary examination of the data has revealed that many third-party vendors in different tax brackets have not been filing returns, while some have been inconsistent in doing so.
“Such measures are part of the second phase of the tax department’s Operation Clean Money, to bring those who have declared unaccounted cash and deposits after demonetisation under the tax net,” said a senior official of the Central Board of Direct Taxes (CBDT). Sources said the CBDT had set the target of adding 10 million taxpayers in the current financial year (FY18).
Under provisions of Section 194 (C) of the I-T Act, a company has to deduct tax at source at the rate of 10 per cent on payments made to professionals or for technical services, if their bill is Rs 30,000 or more.
“The efforts of the tax department to expand the taxpayer base are understandable. Tracking TDS is an important tool to check whether people have filed their taxes,” said Sanjay Sanghvi, partner, Khaitan & Co.
During 2015-16, there were only 55.9 million people in the country who paid income tax. Last year, the tax department had added 9.1 million taxpayers, expanding the base to 65 million.
The government had recently amended the provisions in the I-T rules dealing with the filing of returns. Those not filing on time will have to pay a fine.
For instance, for people earning below Rs 5 lakh annually, missing the deadline will make them liable to a fine of Rs 1,000; those with earnings above Rs 5 lakh annually will have to cough up Rs 5,000 as penalty.
At present, there is no fine if the returns are filed with a delay within the AY. Official data suggest that about 5 million companies registered in the country, of which only 690,000 filed I-T returns last year.
Most of us collate all information relating to our annual income, investments and tax deducted at source (TDS) before proceeding to file our income tax returns. However, the income tax filing process is a fairly comprehensive exercise. We might miss disclosing an income due to oversight, or claim an exemption or deduction that is not due. What are the options available to us if we make a mistake while filing returns?
