“Phew !! Thank God (and thanks to Pranav Babu) I don’t have to file ITR this year. It is such a painful process”, Said Ajay Dixit, a 27 year old BPO Executive to his friend Kapil.
“And how did you arrive at this conclusion, that you don’t need to file a return?” asked Kapil.
“Aren’t you aware of the notification that came on June 24th, that all those having income below Rs. 5 Lakhs need not file their Income Tax Return?” said Ajay.
“I’m aware of that”, smiled Kapil, “But I guess you are not aware that this exemption also requires a few more conditions to be fulfilled as mentioned below:
1. Total Income after allowable deductions is below Rs. 5 Lakhs.
2. Income is ONLY from salary and savings bank interest.
3. Salary is from ONE employer.
4. Savings bank interest is below Rs. 10,000.
5. Tax due on savings bank interest has been paid and included in Form 16.”
“But I am fulfilling most of these conditions Kapil.” Said Ajay.
“Thats good to know. However, the unfortunate part is, you can avail of the exemption, ONLY when you fulfill ALL of the above conditions, and not most of them.” Said Kapil. “Most generally, people with an income range of Rs. 2-5 Lakhs would have various other sources of income like FDs, Bonds, Mutual Funds etc. If you have income from any of these, you have to file ITR. Also, let us assume for 2 minutes that you have only savings account interest, which is below Rs. 10,000. But still have you mentioned this income to your employer prior to 31st March 2011, so that he deducts your tax accordingly and mentions it in the Form 16?”
“No ways. How would I do that before 31st March 2011, when I came to know on 24th June 2011, that I have to do something of this sort ?” Ajay was disappointed.
“There you are !! This isn’t a problem just with you but most of the people who “thought” they need not file a return. So this exemption appears to me more like a mirage. As you approach closer to it, you will find that it doesn’t really exist.” Said Kapil.
“Ohh No !! That means I will have to file an ITR”, Ajay was totally disappointed by now.
“Well, you will have to. But then why do you view filing of ITR as a compliance? It is in your benefit to file an ITR” said Kapil.
“Ok, tell me. How is it in my benefit to file an ITR?” asked Ajay.
“There are several benefits of filing an ITR such as:
- Availing any kind of loan like home, personal or education;
- Visa and immigration processing;
- Income proof / net worth certification;
- Refund claims (in case of excess taxes paid); and
- Applying for a higher insurance cover.”
Said Kapil, “So do not view it as a compliance and do not feel sad that you are not getting an exemption from filing an ITR. File it happily as it is going to benefit yourself in the long run.”
“Thanks for that nice piece of information, Buddy” acknowledged Ajay.
We look forward to your feedback and comments on the above article. Please feel free to contact us on saurabh@nidhiinvestments.com if you have any questions.
(The views mentioned in the article are personal opinion of the author. The characters used in the article are hypothetical)
#NidhiInvestments
#ProfessorBajaj
#SIP
#BestWealthPlanner
#MutualFundsSahiHai
#AdvisorZaruriHai
Like this:
Like Loading...
Related
Published by professorbajaj
Prof. Saurabh Bajaj is an Author, Mentor, Motivational Speaker and Wealth Planner.
He has done his MBA from Narsee Monjee Institute of Management Studies (NMIMS) Mumbai, one of the top 10 management institutes in India. He holds the prestigious FRM (Financial Risk Manager) degree awarded by Global Association of Risk Professionals (GARP), USA. Till date, there are less than 15,000 professionals in the world, who have been honored with this degree. He has also been awarded CFGP (Chartered Financial Goal Planner) Certification by AAFM (American Academy of Financial Management).
After his MBA, he joined J P Morgan, the second largest Investment Bank in the world. He has worked with J P Morgan as Risk Analyst for more than two years.
Prof. Bajaj also holds an Advisory certification awarded by AMFI (Association of Mutual Funds of India). During his stint at Bombay Stock Exchange, he has handled Investment Management and Treasury operations of the BSE Corpus. He has set up an entrepreneurship venture in the field of Wealth Planning and Investment Consulting under the name “Nidhi Investments” and holds the profile of CEO.
Prof. Bajaj sits on the Expert Panel of CAClubindia.com and MBAClubindia.com as Investment Expert.
He is actively involved in investor education through his blog www.professorbajaj.com which has a readership from 78 Countries all over the world. His articles are also regularly published in caclubindia.com , mbaclubindia.com , totalca.com , charteredclub.com, bankbazaar.com and lawyersclubindia.com .
He has been awarded the title of “Best Article Writer” from caclubIndia.com in Jan 2012 and has been selected amongst “Top 5 Technical Writers” from all over India in Feb 2013.
He has been invited by various TV Channels like SPIN TV, CNBC TV18, UTV Bloomberg Etc for programs like "Expert Advice" , "What Markets Want ", "Budget Analysis" etc.
He has been invited by Several organisations like Lions Club, Rotary Club, Agrawal Welfare Foundation, Rajasthan Mandal, Agroha Vikas Trust, Union MF, UTI MF, Arthamitra Gurukulam, Vidyalankar Institute of Technology etc for expert lecture on "Smart Investing", "Life is A Celebration", "Financial Freedom", "The Digital IFA" etc.
He was ranked 8th Merit at All India level NMAT which got him selected for MBA programme at NMIMS, Mumbai. He did his MBA with Capital Markets as his specialisation.
Soft Skills has become an inevitable part of every selection process and teaching learning process these days. The students from small towns and tier II cities, in spite of being talented and well equipped with technical skills, are seen struggling in the selection process. This is because of their lack of exposure to these soft skills. Mr. Bajaj has a zeal for training candidates to develop these skills and has been imparting the same on since last two years. This zeal and passion inspired him to set up his own firm called “Knowledge Circle” which aims to train candidates for soft skills.
Till date, he has trained more than 5000 participants from over 220 organizations across various fields of soft skills.
He has been associated with MSBTE (Maharashtra State Board of Technical Education) to conduct Soft skills training workshop for the faculties of Polytechnic Colleges in Entire Maharashtra (Mumbai Region, Pune Region, Aurangabad Region and Nagpur Region) since last 8 years.
He has also been associated with ICAI (Institute of Chartered Accountants of India) for training CA Students on various topics related to Communications skills, Group Discussions etc.
He was invited by Fr. Agnel Polytechnic College, Vashi for a motivational workshop for faculties. He was also invited by Vivekanad Polytechnic College for "Communication Skills and Email Etiquette" training for non-teaching staff.
Apart from these, he has conducted “Capacity Building Soft Skills workshop for Faculties” at ITI Gunj, ITI Pusad, ITI Digras and ITI Umarkhed. This was the first ever soft skills workshop for faculties in the history of ITI’s in Vidarbha. He was also invited by Shivaji Education Society to conduct similar Soft skills workshops for the faculties and office staff of Shivaji Junior College Pusad, Shivaji High School Pusad, Shivaji Vidyalaya Belora and Shivaji Vidyalaya Bhojla.
He has conducted training workshop on “Effective Presentation Skills” for the relationship managers of HDFC Mutual Fund, Andheri Branch, Mumbai.
He has also been invited at College of Management and Computer Science, Yavatmal, College of Dairy Technology, Warud, B N College of Engineering, Pusad, B D College of Engineering, Wardha, College of Engineering and Technology, Akola, Dr.N.P.Hirani Institute of Polytechnic, Pusad etc. for the Guest lecture on “Developing Interview Skills”.
View more posts
Professorbajaj's Blog 
Dear Sir,
I have a salary income of Rs. 3.11 Lakhs p.a. Apart from this I have few other income like FD interest etc. From what I understand is, I will have to file ITR.
My question is, what is the procedure to file ITR ?
Dear Mr. Raghu,
I hope you are clear that you will need to file an ITR and it is in your benefit to file the same.
Coming to your question of how to file an ITR, there are several ways available. You may go for e-filing, or download the form and fill it up manually or you may also seek professional assistance for the same.
For further details, you may mail me at saurabh@nidhiinvestments.com
Thanks for your visit and feedback. Looking forward to more in future.
Regards
Didn’t get “» Applying for a higher insurance cover” ?
You might be aware that when you want to apply for a higher life insurance cover, say Rs. 1 Crore, they would ask you for your ITRs so that the cover is a certain reasonable multiple of the income.
I have seen many clients getting a lower life risk cover (Rs. 5 -10 Lakhs) because of the simple fact that they did not file their ITRs.
Hope I could answer your question satisfactorily. Thanks for your visit and feedback. Looking forward to more in future.