Any tax expert here.....need help with choosing ITR-1 or ITR-2

Status
Not open for further replies.
M

mymatl

Contributor
I am a salaried employee with one home loan.

So basically I suppose to file ITR-1, but as there is a some new amendment from this year that if exempt income is more that 5000 one has to file ITR-2. I am just totally confused, which part will come under exempted income.
Searched alot on the Google and many places it was mentioned like HRA & Conveyance allowance also considered as exempted income and has to file ITR-2.
 
to be honest, unless you have been scrutinized by IT earlier, you can use ITR1. more clarity will be available next year.
in terms of exempt income of 5000/- ; this refers to :

  • income from dividends\equities
  • interest income from savings accounts
  • interest income from fixed deposits
  • income from gifts ( marriage gifts etc)
IMO, and I am NOT an Accountant, House Rent Allowance is not part of the question of ITR1 / ITR2. Please use this as a ballpark suggestion, and not the IT Regulations
 
AFAIK interest from fixed deposits and savings account are taxable [and TDS is already deducted from the bank if it exceeds some value , 10,000 I guess]. So they should not fall in exempted income category. @babhishek , Please correct me if I am wrong. Got to file entire families' ITR this week. :(
 
Last edited by a moderator:
What gets me is they want e-filings from people who make 5-10 lakhs annual now. Previously e-filing was only for those above 10.

get the spreadsheet, fill it out, generate xml then it on their website.

How many people have internet and a computer to do this ?
 
babhishek said:
the question is ITR 1 vs 2,but ITR1 is to be used if exempted income ( as per categories above is <5k)
HRA is always deductable, so whats your point?
Click to expand...

Point I was trying to make is that in case I take leave encashment and get say Rs. 4,000, that is exempt income and it will not constitute part of my taxable income.
HRA on the other hand is part of your CTC - it is not exempt and has to be declared in your gross income. So if your basic is 20,000 and HRA is 10,000; then your income for the year will be (20k+10k)*12 = 3.6lpa. On this you're eligible to pay tax. But if and only if you have valid rent receipts, then you can claim a deduction under HRA.

Hope I'm clear and correct :oops: . For example, I do not claim any deductions under HRA as I do not live in a rented accommodation. So my taxable income always goes up.
 
Itax is not a joke, can land you up in trouble if scrutiny happens. Wrong suggestions/assumptions does not work here, every thing is in black and white and needs to be followed correctly. I am CBDT trained finance guy and can throw some light on this. Simply exempt income means the income/seemed income that is not taxable, you dont have to pay tax on it but you still have to declare to the government. Exemption covered under section 10 is seperate (check http://law.incometaxindia.gov.in/Directtaxlaws/act2005/section10.htm). Dont get confused. Certain type income can be exempted from tax provided certain conditions are met which are defined in Income Tax Act. Exempt income includes tax-free sources of income, such as the interest on PPF, tax-free bonds and dividends . The long-term capital gains from stocks and equity funds, the agricultural income and gifts from specified relatives. Some of the income which are exempted from Indian Income Tax and their sections are given below.
  • Agriculture Income [Sec. 10(1)]
  • Payments received from family income by a member of HUF [Sec. 10(2)]
  • Leave travel concession provided by as employer to his Indian citizen employee [Sec. 10(5)]
  • Any sum received on life insurance policy (including bonus) is not chargeable to tax Any sum (including bonus) on life insurance policy (not being a keyman insurance policy) [Sec. 10(10D)]
  • Any amount from provident fund paid to retiring employee [Sec. 10(11)]
  • Amount from an approved superannuation fund to legal heirs of the employee [Sec. 10(13)]
  • House rent allowance subject to certain limits [Sec. 10(13A)]
  • Interest from certain exempted securities [Sec. 10(15)]
  • Scholarship granted to meet the cost of education [Sec. 10(16)]
  • Family pension received by family members of armed forces [Sec. 10(19)]
  • Income of a minor child up to Rs. 1,500 in respect of each minor child whose income is included under section 64(1A) [Section 10(32)]
  • Dividend on or after April, 2003 from domestic companies [Section 10(34)]
  • Income on units of Mutual Funds on or after April 1, 2003 [Section 10(35)]
 
@uziel

So as I mentioned earlier HRA is there in my salary, In your view I guess I have to file ITR-2?
 
Last edited by a moderator:
Exempt Income is income exempt under section 10. There is a long list of these, and you can just search them in any of the bare acts. The govt gives these as flat exemptions and not deductions. But to keep a track of those with exempt incomes, the govt insists you have to also declare them.

For specific questions you can PM me.
 
I sent my ITR-V form bu ordinary post around 15 days back, but on income tax india website it is still showing ITR-V not received. Any idea how much time it takes? or do i need to send it again to banglore? I did not received any receipt confirmation in my mail. Please advice. Thanks in advance. :)
 
It did take them a month to update the receipt status of mine last year. You can call their CC cell in another 10 days or so to check
 
You have to ensure that they get in 120 days from the date of filing. If you feel there is a delay, resend via speed post.
 
  • Like
Reactions: Party Monger
axeman said:
You have to ensure that they get in 120 days from the date of filing. If you feel there is a delay, resend via speed post.
Click to expand...
My last year's ITR shows still Uploaded only , I spoke to helpline and they said re-send it so do i have to just take a print and sign and send or do i have fill the form again as revised ?
 
You just have to re-send it. You revise it only when you have to change something from your original return.
 
Status
Not open for further replies.
Top Bottom