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Income Tax – Latest Updates, Basics, Tax Slabs, Income Tax Department & Laws – Income Tax Guide 2022

Income Tax in India FY 2021-22 (AY 2022-23) - Basics, Income Tax Department, Rules, ITR Filing, Tax Slabs & Deductions

Updated on :  

08 min read

What is Income Tax? Income tax is a type of direct tax the central government charges on the income earned during a financial year by the individuals and businesses. It is calculated based on the tax slabs defined by Income Tax Department.

What’s New in Income Tax

  • 02 May 2022 – CBDT notifies form for filing the ‘Updated’ income tax returns

  • 27 April 2022 – Form 26A, Form 27BA, Form 10BD & Form 10BE are available on the income tax portal.

  • 20 April 2022 – Income Tax Portal announced that UDIN update functionality is enabled for Forms filed from June 2021 onwards.

Budget 2022 Updates

  • New provision is introduced to allow taxpayers to update the past return and include omitted income by additional tax payment.
  • Income from transfer of digital assets such as crypto to be taxed at 30%.
  • The surcharge on the long-term capital gains (LTCG) has been capped at 15%

Click here for the latest Press release on income tax due dates

Browse By Topics

What is Income Tax?

Income tax is a type of tax that the central government charges on the income earned during a financial year by the individuals and businesses. Taxes are sources of revenue for the government. Government utilizes this revenue for developing infrastructure, providing healthcare, education, subsidy to the farmer/agriculture sector and in other government welfare schemes. Taxes are mainly of two types, direct taxes and indirect form of taxes. Tax levied directly on the income earned is called as direct tax, for example Income tax is a direct tax. The tax calculation is based on the income slab rates applicable during that financial year.

Direct Taxes are broadly classified as :

  • Income Tax – This is taxes an individual or a Hindu Undivided Family or any taxpayer other than companies, pay on the income received. The law prescribes the rate at which such income should be taxed
  • Corporate Tax – This is the tax that companies pay on the profits they make from their businesses. Here again, a specific rate of tax for corporates has been prescribed by the income tax laws of India.


Who should pay Income Tax? – Types of Tax Payers

he Income tax Act has classified the types of taxpayers in categories so as to apply different tax rates for different types of taxpayers.
Taxpayers are categorized as below:

  • Individuals
  • Hindu Undivided Family (HUF)
  • Association of Persons(AOP)
  • Body of Individuals (BOI)
  • Firms
  • Companies

Further, Individuals are broadly classified into residents and non-residents.Resident individuals are liable to pay tax on their global income in India i.e. income earned in India and abroad. Whereas, those who qualify as Non-residents need to pay taxes only on income earned or accrued in India. The residential status has to be determined separately for tax purposes for every financial year on the basis of the individual tenor of stay in India.Resident Individuals are further classified into below mentioned categories for tax purposes-

  • Individuals less than 60 years of age
  • Individuals aged more than 60 but less than 80 years
  • Individuals aged more than 80 years

Types of Income – What are the 5 heads of income?

Everyone who earns or gets an income in India is subject to income tax.(Yes, be it a resident or a non-resident of India ).For simpler classification, the Income tax department breaks down income into five main heads:


Head of Income Nature of Income covered
Income from Other Sources Income from savings bank account interest, fixed deposits, winning in lotteries is taxable under this head.
Income from House Property Income earned from renting a house property is taxable under this head of income.
Income from Capital Gains Surplus Income from sale of a capital asset such as mutual funds, shares, house property etc is taxable under this head of Income.
Income from Business and Profession Profits earned by self employed individuals, businesses , freelancers or contractors & income earned by professionals like life insurance agents, chartered accountants, doctors and lawyers who have their own practice, tuition teachers are taxable under this head.
Income from Salary Income earned from salary and pension is taxable under this head of income


Taxpayers and Tax Slabs

Each of these taxpayers is taxed differently under the Indian income tax laws. While firms and Indian companies have a fixed rate of tax calculated on their tax profits, the individual,HUF, AOP and BOI taxpayers are taxed based on the income slab they fall under. People’s incomes are grouped into blocks called tax brackets or tax slabs. And each tax slab has a different tax rate.Rate at which income is charged to tax increases with increase in income. Budget 2020 introduced a ‘New tax regime’ for the Individuals and HUF taxpayers :

 

What is the Existing / Old Income Tax Regime?

The old tax regime provides 3 slab rates for levy of income tax which are 5%, 20% tax rate and 30% for different brackets of income. The individuals have been given the option to continue with this Old tax regime and they can claim deductions of allowances like Leave Travel Concession (LTC), House Rent Allowance (HRA), and certain other allowances. Additionally, deductions for tax saving investments as per section 80C (LIC, PPF ,NPS etc) to 80U can be claimed. Standard deduction of Rs 50,000, deduction for interest paid on home loan.
Tax slab rates applicable for Individual taxpayer below 60 years for Old tax regime is as below:


Income Range Tax rate Tax to be paid
Up to Rs.2,50,000 0 No tax
Between Rs 2.5 lakhs and Rs 5 lakhs 5% 5% of your taxable income
Between Rs 5 lakhs and Rs 10 lakhs 20% Rs 12,500+ 20% of income above Rs 5 lakhs
Above 10 lakhs 30% Rs 1,12,500+ 30% of income above Rs 10 lakhs

There are two other tax slabs for two other age groups: those who are 60 and older and those who are above 80.A word of note: People often misunderstand that if they earn let’s say Rs.12 lakhs, they will be paying a 30% tax on Rs.12 lakhs i.e Rs.3,60,000. That’s incorrect. A person earning 12 lakhs in the progressive tax system, will pay Rs.1,12,500+ Rs.60,000 = Rs. 1,72,500. Check out the income tax slabs for previous years and other age brackets.


Income Tax Slabs Under New Tax Regime

From the FY 2020-21, a new tax regime is available for individuals and HUFs with lower tax rates and zero deductions/exemptions. Individuals and HUF have the option to choose the new regime or continue with the old regime.The new tax regime is optional and the choice should be made at the time of filing the ITR. If the old regime is continued than all the deductions/exemptions as available can be availed by the taxpayer. The income tax slabs under the new tax regime are:

New regime slab rates Existing regime slab rates
Income from Rs 2.5 lakh to Rs 5 lakh 5% Income from Rs 2.5 lakh to Rs 5 lakh 5%
Income from Rs 5 lakh to Rs 7.5 lakh 10% Income from Rs 5 lakh to Rs 10 lakh 20%
Income from Rs 7.5 lakh to Rs 10 lakh 15% Income above Rs 10 lakh 30%
Income from Rs 10 lakh to Rs 12.5 lakh 20%
Income from Rs 12.5 lakh to Rs 15 lakh 25%
Income above Rs 15 lakh 30%

Most of the deductions like deductions and exemptions are not allowed if the taxpayers opts for the New Tax regime. However he exemptions and deductions available under the new regime are:

  • Transport allowances in case of a specially-abled person.
  • Conveyance allowance received to meet the conveyance expenditure incurred as part of the employment.
  • Any compensation received to meet the cost of travel on tour or transfer.
  • Daily allowance received to meet the ordinary regular charges or expenditure you incur on account of absence from his regular place of duty.


Exceptions to the Income Tax Slab

One must bear in mind that not all income can be taxed on slab basis. Capital gains income is an exception to this rule. Capital gains are taxed depending on the asset you own and how long you’ve had it. The holding period would determine if an asset is long term or short term. The holding period to determine nature of asset also differs for different assets. A quick glance of holding periods, nature of asset and the rate of tax for each of them is given below.

Type of capital asset Holding period Tax rate
House Property Holding more than 24 months – Long Term Holding less than 24 months – Short Term 20% Depends on slab rate
Debt mutual funds Holding more than 36 months – Long Term Holding less than 36 months – Short Term 20% Depends on slab rate
Equity mutual funds Holding more than 12 months – Long Term Holding less than 12 months – Short Term Exempt (until 31 March 2018) Gains > Rs 1 lakh taxable @ 10% 15%
Shares (STT paid) Holding more than 12 months – Long Term Holding less than 12 months – Short Term Exempt (until 31 March 2018)Gains > Rs 1 lakh taxable @ 10% 15%
Shares (STT unpaid) Holding more than 12 months – Long Term Holding less than 12 months – Short Term 20% As per Slab Rates
FMPs Holding more than 36 months – Long Term Holding less than 36 months – Short Term 20% Depends on slab rate

Financial year

The financial year is a one-year period that the taxpayers use for accounting and financial reporting purposes. It is the year in which the income is earned. According to the Income Tax Act, such a period begins from 1st April of the calendar year to 31st March of the next calendar year. It is abbreviated as “FY”. For example, for the financial year starting from 1st April 2021 and ending on 31st March 2022, it can be written as FY 2021-22.


Assessment year

The one year period from 1st April to 31st March starting immediately after the financial year is termed as assessment year. This period is called the assessment year because all the taxpayers have to evaluate their income earned in the financial year and pay taxes in this year. For example, for incomes earned during the FY 2021-22, the assessment year will be AY 2022-23.


Assessee

The assessee is a person or a group who assesses his/her income and pays tax as per the Income Tax Act. The assessee can be an individual, a partnership firm, a company, an Association of Persons (AOP), trust, etc.


What is PAN?

PAN is an abbreviation for the Permanent Account Number. It is a unique 10-digit alphanumeric digit issued by the Income Tax Department to Indian taxpayers. All the tax-related transactions and information of a person are recorded against their unique permanent account number. When the person has to pay advance tax or self assessment tax, he/she needs to mention the PAN number. Also, where the person submits his PAN to certain entities like banks, mutual fund companies, etc. The financial information from such entities goes to the income tax department via PAN. This allows the taxman to link all tax-related activities with the department. Hence, just by putting a permanent account number the taxman can identify all your financial transactions.


What is TAN?

TAN is an abbreviation for Tax Deduction and Collection Account Number. It is a unique 10 digit alpha numeric digit allotted by the Income Tax Department of India. All persons responsible for deduction (TDS) or collection of tax (TCS) are reresponsible for obtaining TAN. It is compulsory to quote the TAN in TDS/TCS return, any TDS/TCS payment challan, and TDS/TCS certificates.


Residents and non residents

Levy of income tax in India is dependent on the residential status of a taxpayer. Individuals who qualify as a resident in India must pay tax on their global income in India i.e. income earned in India and abroad. Whereas, those who qualify as Non-residents need to pay taxes only on their Indian income. The residential status has to be determined separately for every financial year for which income and taxes are computed.


Income Tax Payment

Tax Deducted at Source (TDS)

For specified payments, tax is deducted at source by the payer when making payment to the recipient of income. The recipient of income can claim the credit of the TDS amount by adjusting it with the final tax liability.

Advance Tax

The taxpayer must pay tax in advance when his estimated income tax liability for the year exceeds Rs 10,000. The government has specified due dates for payment of advance tax installments.

Self-Assessment Tax

It is the balance tax that the taxpayer has to pay on the assessed income. The self-assessment tax is calculated after reducing the advance tax and TDS from the total income tax calculated on the assessed income.

e-Payment of Taxes

The taxpayers can pay advance tax, self-assessment tax online from the NSDL website. However, the taxpayer should have a net banking facility with an authorised bank.



Filing your ITR

Filing of income tax return online has been made mandatory for all classes of taxpayers barring few exceptions :

  • Taxpayers aged 80 and above need not filed return online
  • Taxpayers having an income less than Rs 5 lakhs and not claiming a refund need not file return online

For the rest, online filing is mandatory. Do note that deadlines for filing of returns have also been prescribed. For most individual taxpayers, the due date for filing return of income is 31 July immediately following the concerned financial year. If you do not file on time, here are some disadvantage:

  • You will be denied carry forward of losses (except house property loss) to future years
  • Delay processing of refund claims if any
  • Difficulty on getting home loans
  • Levy of late filing fee upto Rs 10,000 under Section 234F
  • Levy of interest under 234A if there are taxes due as on 31 July(

E-filing online is a more complete and better alternative to filing on the income tax website. Also it is for more than just e-filing your income tax return. Clear helps you claim all the deductions you’re eligible for and helps you invest. Once you file your return online, you either e-verify the same or take a print of the ITR V and send it to CPC, Bengaluru for processing of your return.
Read our detailed article on e-verification of return of income.
Here’s a guide to e-filing your first tax return on Clear.

Income Tax Return

The taxpayer shall file an income tax return every year via ITR forms prescribed by the income tax department. The government has prescribed seven ITR forms through which the taxpayer can file his income tax return. The taxpayer has to choose the appropriate ITR forms and file his income tax return.

Income Tax Forms List

The seven ITR forms are:

  • ITR-1: Individuals (residents) having income from salary, one house property, other sources, agricultural income less than Rs 5,000 and with a total income of up to Rs 50 lakh
  • ITR-2: Individuals/HUFs not having any business or profession under any proprietorship
  • ITR-3: Individuals/HUFs having income from a proprietary business or profession
  • ITR-4: Individuals/HUFs having presumptive income from business or profession
  • ITR-5: Partnership firms or LLPs
  • ITR-6: Companies
  • ITR-7: Trusts

Documents Required for ITR Filing

Form 16, Form 26AS, Form 16A, proof of tax saving investments made, bank account details etc are some of the crucial details / documents that you need to be ready with before filing your return. Further the documents you are going to need to file your tax return are largely going to depend on your source of income. Here is our detailed article on documents you need for filing of your return of income



How can I calculate my income tax?

Individuals should calculate income tax depending on the nature of income. The salaried individual can take the eligible exemptions available for various allowances received. Individuals/HUF can take a deduction under Sections 80C to 80U, deduct it from the gross total income, and calculate the income tax liability. Also, the total income tax liability should be adjusted by the taxes paid, such as advance tax, TDS, etc. Also, the taxpayer should apply the effect of rebate under Section 87A and relief under Section 89, Section 90, and Section 91 to arrive at the net amount of income tax payable.

Every income that your receive should form part of your income tax return. Of course, the law does provide for exemption of certain incomes eg. dividend income from an Indian company, LTCG on listed equity shares upto Rs 1 lakh in any financial year etc. Therefore, here is a quick guideline you can probably follow to compute taxes due on your income:

  • List down all your income – be it salary, rental income, capital gains, interest income or profits from your business or profession
  • Remove incomes that are exempt under law
  • Claim all applicable deductions available under every source of income . eg claim standard deduction of Rs 50,000 from salary income, claim municipal taxes from rental income, claim business related expenses from your business turnover etc
  • Claim all applicable exemptions under every head of income eg. amount reinvested in another house property can be claimed as exemption from capital gains income etc
  • Claim applicable deductions from your total income eg the 80 deductions like 80C, 80D, 80TTA, 80TTB etc
  • You will now arrive at your taxable income. Check the tax slab you fall under and accordingly arrive at your income tax payable.

The government keeps introducing and altering tax slabs, schemes and tax benefits, so it’s a good idea to keep up with the Budget.



What is computation of income?

The process of calculating taxable income after taking into account the income from all the five heads (salary, house property, capital gains, business or profession, and other sources), exemptions, deductions, rebate, set off of losses, etc., is called computation of income. After computation of income, the taxpayer can compute the income tax liability as per the Income Tax Act.



Rebate u/s 87A

Rebate under Section 87A allows taxpayers reduce their income tax liability. If you are a resident individual and the amount of your total income after reducing Chapter VI-A deductions (Section 80C, 80D, 80U, etc) does not exceed Rs 5 lakh in a financial year, you can claim a tax rebate up to Rs 12,500. This means, if your total tax payable is less than Rs 12,500, then you will not have to pay any tax.



e-File Returns

The taxpayer shall electronically file the income tax return through the e-filing platform of the IT department. To file the income tax return, the taxpayer should first register himself at www.incometax.gov.in. Thereafter, the taxpayer can log in to the website and file his ITR. Also, there is no need to manually send the acknowledgement of the return to the income tax department. The income tax department now allows e-verification of the ITR in different ways, which completes the income tax return process.



What is ITR –V?

Form ITR-V is an income tax return verification form generated after the taxpayer submits files income tax return and submits it to the income tax department. The ITR-V should be e-verified or must be sent to CPC Bangalore at “Income Tax Department – CPC, Post Box No – 1, Electronic City Post Office, Bangalore – 560100, Karnataka” for verification. The ITR processing takes plae only if its verification is completed.



Did you e-file your Tax return for this year?

You can file your Income Tax Return on ClearTax. Even if you don’t know anything about taxes, we will take you step-by-step and help you e-file.Check ClearTax Income Tax E Filing



Income Tax Saving Instruments

The taxpayer can save tax by tax planning. A taxpayer can do tax planning by investing in tax-saving instruments. It helps in reducing the income tax liability. Section 80C to 80U of the Income Tax Act allows a deduction for certain expenditures and investments from the total computed income. Some of the popular Section 80C investments are:


Popular Section 80C Investments
  ELSS PPF NSC 5-Year Tax Saving FD SCSS
Section 80C Benefit Yes Yes Yes Yes Yes
Type of InvestmentType of Investment Equity Fixed Income Fixed Income Fixed Income Fixed Income
Lock-in Period 3 Years 15 Years 5 Years 5 Years 5 Years
Maximum Investment No Max Limit Rs 1.5 lakh No Max Limit Rs 1.5 lakh Rs 15 lakh

*ELSS and NSC have no upper investment limit. However, you get tax benefits under Section 80C only up to Rs 1.5 lakh per financial year.

Health Insurance and Medical Expense Deduction

Apart from the 80C deduction, a taxpayer can also take a tax benefit under Section 80D for health insurance premium and medical expenditure incurred for self, family and parents.


Person insured Maximum deduction Below 60 years Maximum deduction 60 years or older
You, your spouse, your children Rs. 25,000 Rs. 50,000
Your parents Rs. 25,000 Rs. 50,000
Preventative health checkup Rs. 5,000 Rs. 5,000
Maximum deduction (includes preventive health checkup) Rs. 50,000 Rs. 1,00,000

Education Loan Deduction

Under Section 80E, the taxpayer can claim a deduction for the interest paid on a loan taken for higher education. There is no limit to claim such a deduction in the income tax return.

Home Loan Deduction

Under Section 24, the taxpayer can claim a deduction for interest paid on a housing loan during the relevant financial year. The amount of deduction will depend upon whether the house is self-occupied or let out. The taxpayer can also claim a deduction of the principal amount of loan under Section 80C up to Rs 1.5 lakh.


Deduction on Maximum allowed (for self-occupied house property) Maximum allowed (for property on rent)
Stamp duty and registration + principal Rs. 1,50,000 within the overall limit of Section 80C Rs. 1,50,000 within the overall limit of Section 80C
Deduction on home loan interest under Section 24 Rs. 2,00,000 No cap (but rental income must be shown in the income tax return) Further, maximum loss from house property capped at Rs 2 lakhs
Deduction for first-time homeowners under Section 80EE *certain conditions apply Rs. 50,000

Deduction for Interest Income

The taxpayer can also claim a deduction for interest on deposits from banks under Section 80TTA of the Income Tax Act. The individuals can claim up to Rs 10,000 deduction under the said section.

Important Income Tax Dates 2022

  • 15th June 2022 – Due date for the first instalment of advance tax for the FY 2022-23
  • 15th July 2022 – Income tax return filing for FY 2021-22 for individuals and entities not liable for tax audit and who have not entered into any international or specified domestic transaction
  • 15th September 2022 – Due date for the second instalment of advance tax for the FY 2022-23
  • 30th September 2022 – Submission of audit report (Section 44AB) for AY 2022-23 for taxpayers liable for audit under the Income Tax Act.
  • 31st October 2022 – ITR filing for taxpayers requiring audit (not having international or specified domestic transactions).
  • 31st October 2022 – Submission of audit report for AY 2022-23 for taxpayers having transfer pricing and specified domestic transactions
  • 30th November 2022 – ITR filing for taxpayers requiring audit (not having international or specified domestic transactions).
  • 15th December 2022 – Due date for the third instalment of advance tax for the FY 2022-23
  • 31st December 2022 – Last date for filing a belated return or revised return for FY 2021-22.


Income Tax Law

Income Tax Act

The Income Tax Act includes all the provisions that govern the country’s taxation. Every year, the Finance Minister presents a budget in February. The Union Budget brings in various amendments to the Income Tax Act. The most recent Union Budget presented by the current Finance Minister included the introduction of a new tax regime.

Apart from the IT Act, the other components of the income tax law are income tax rules, circulars, notifications and case laws. All of these help in the implementation of income tax law and collection of taxes.

About Income Tax Department India

The income tax department is a government agency. The Act empowers the income tax department to collect direct tax on behalf of the Government of India. The Ministry of Finance manages the revenue functions of the Government of India. The finance ministry has given the task of administration of direct taxes like Income-tax, etc., to the Central Board of Direct Taxes (CBDT). The CBDT is one of the parts of the Department of Revenue in the Ministry of Finance. The CBDT administers the direct tax laws through the IT Department. Thus, The income tax department is a government agency that administers the Income-tax law under the control and supervision of the CBDT. The Income tax department has been given the power to collect direct tax on behalf of the Government of India.



Budget 2022 – All Income Tax Related Announcements

    • New updated return: A new provision is introduced to allow taxpayers to update the return and include any omitted income on payment of additional tax. The updated return needs to be filed within two years from the end of the relevant assessment year.

    • Surcharge: Corporate surcharge to be reduced from 12% to 7%.

    • Startups: The eligible startups under Section 80-IAC benefits are now extended to the eligible startups incorporated until March 31, 2023.

    • Alternate Minimum Tax: AMT to be reduced to 15% for co-operative societies.

    • Crypto taxation: Income from transfer of digital assets such as crypto to be taxed at 30%. No deductions will be allowed except the cost of acquisition of digital assets. Loss on sale of digital assets cannot be set off against any other income. TDS at 1% will be levied if income is over the threshold. Gifting of digital assets will be taxable in the hands of the recipient.

    • NPS: The Finance Ministry has proposed to increased the deduction limit of employers contribution to the National Pension Scheme (NPS) Tier-I account for state government employees from 10% to 14%.

    • Section 80DDB: The parent/guardian of the differently-abled can take a tax deduction for payment to the insurance scheme that provides for the payment of the annuity or lump sumto the differently-abled dependant during the lifetime of the parent and guardians on attaining their age of sixty years or more, and the payment or deposit to such scheme has been discontinued.

    • Eligible business deductions: Any surcharge and cess levied on income are not allowed as business expenditure.

    • Losses set off rules: Brought forward loss cannot be set off against undisclosed income detected during any survey or search.



Income Tax – FAQs

  • When it is mandatory to file return of income?

    The companies and firms are mandatorily required to file an income tax return (ITR). However, individuals, HUF, AOP, BOI should file ITR if the income exceeds the basic exemption limit of Rs 2.5 lakh. This limit is different for senior citizens (Rs 3 lakhs) and super senior citizens (Rs 5 lakh).
  • Can i file return of income even if my income is below taxable limits?

    Yes, you can file return of income voluntarily even if your income is less than basic exemption limit
  • What documents are to be enclosed along the return of income?

    There is no need to enclose any documents with the return of income. However, one should retain the documents to produce before any competent authority as and when required in future.
  • Should I disclose all my income in the return even if it is exempt?

    Yes. Income from every source including exempt income must be disclosed. The same can be shown under the Schedule EI.
  • Should I e-verify to get the IT refund?

    e-Verification of the income tax return filed electronically is mandatory to complete the process of ITR filing. One should e-verify income tax returns within the stipulated time. Non-verified ITR will be treated as invalid. You can e-verify ITR by Aadhaar OTP, bank ATM, Electronic Verification Code (EVC), and net-banking.
  • Can I take Section 87A rebate from tax on long-term and short-term capital gains if there is no other income?

    You can take rebate under Section 87A from tax on long-term and short-term capital gains. However, if there is long-term capital gain from sale of equity shares or equity oriented funds (Section 112A), you cannot adjust rebate under Section 87A from tax on such LTCG.
  • Can I file a return after completion of the assessment year?

    The Budget 2022 has proposed to introduce an ‘Updated’ return that can be filed within 24 months of the end of the relevant AY, on the payment of additional tax. Even if you have not filed original return before the due date specified in the Income Tax Act, you can file the ‘updated’ return.
  • What are the maximum exemption limit and slab rates applicable for Assessment Year 2021-22?

    Income Slab Resident and non-resident individuals Senior Citizens (Above 60 yrs but less than 80 yrs) Super Senior Citizens (Above 80 yrs)
    Upto Rs. 250,000 Nil Nil Nil
    Rs. 250,001 – Rs. 300,000 5% Nil Nil
    Rs. 300,001 – Rs. 500,000 5% 5% Nil
    Rs. 500,001 – Rs. 10,00,000 20% 20% 20%
    Above Rs. 10,00,000 30% 30% 30%


Latest Income Tax News Articles

Learn how to claim Section 80G deduction as per changed income tax rules [17 May 2022]
If you want to claim a deduction under Section 80G for donations made to specified institutions during the financial year 2021-22, you can do so if Form 10BE is issued by the charitable organisation. The income tax rules to claim 80G deduction are changed from the assessment year 2022-23.
Read the full article

Important Cash Transaction Limits and Penalties Under Income Tax That You Need to Know About [14 April 2022]
In India, there are a lot of transactions that go unaccounted for, with people often transacting in cash to avoid the government’s radar. To curtail the black money menace, the government has put several limits that individuals and businesses need to adhere to when they transact in cash.
Read the full article

Loss from one crypto asset cannot be adjusted with gains from another [23 March 2022]
The government had clarified the crypto taxation provisions introduced in Budget 2022. As per the new law on crypto taxation, the taxpayer has to pay 30% tax on the income earned from the transfer of crypto assets. No deductions are allowed to be taken from the income except the acquisition cost.
Read the full article

5 Methods to Verify Your Income Tax Return Other Than by Aadhaar [22 March 2022]
ITR verification through a one-time password linked to an individual’s Aadhaar is one of the popular and quicker ways to do it. But here are 5 other ways in which a taxpayer can verify their income tax return.
Read the full article

Pay the last advance tax instalment for FY 2021-22 by 15th March [14 March 2022]
The last advance tax instalment for FY 2021-22 is due on 15th March 2022. The advance tax payment helps you stay a step ahead of your tax liabilities so that you are not left worrying about how much you owe to the income tax department.
Read the full article

Know when the income tax exemption applies for gifts received as crypto assets [24 February 2022]
In Budget 2022, the government has proposed that the gifts received as cryptocurrency, Non-Fungible Tokens (NFTs), etc. or the transfer of such assets without consideration shall be taxable in the hands of the recipient. The Finance Bill 2022 has defined cryptocurrency, NFTs, etc., as ‘Virtual digital assets’ (VDA).
Read the full article

Know the taxation rules for income F&O trading [15 February 2022]
Futures and options are stock derivatives that are traded in the stock market. It is a contract between two parties for trading stock or index at a particular price or level at a future date. While many people trade in futures and options, it is advisable to understand the income tax implications before investing in them. Here is what you need to know.
Read the full article

Tax deductions available to the taxpayers on home loan [11 February 2022]
For the homeowners, interest paid on housing loans can maximise their income tax savings. Let’s see how much a home loan can reduce your taxable income.
Read the full article

Union Budget 2022: Key Amendments in Taxation Decoded for the Taxpayers [01 February 2022]
The Finance Minister presented the Budget 2022 speech today. There were no changes in the individual taxpayer’s tax slab rates, but the finance minister provided new taxation rules for the income generated from virtual digital assets. Let’s look at the key amendments in the Finance Bill 2022 for the taxpayers.
Read the full article



All Articles

  1. Tax evasion is a criminal offence and invites considerable penalties along with evaded tax, or in some cases, a jail sentence for up to seven years also.
  2. The Section 89A prescribes relief from taxation of income from overseas retirement benefits accounts and is beneficial to NRIs who chose to settle in India.
  3. The EPFO has directed mandatory e-nomination for all its EPF members. Read the article for EPF e-Nomination details, step-by-step guide on the need for e-nomination in EPFO and how to go about it.
  4. For a trust, institution, or NGO to apply for permanent registration, which shall be valid for five years, e-filing of Form No. 10AB is required
  5. यह लेख राष्ट्रीय ग्रामीण रोजगार गारंटी अधिनियम 2005 के उद्देश्य, सुविधाओं, अधिनियम के कार्यान्वयन के वित्तपोषण और इसकी भूमिकाओं और जिम्मेदारियों के बारे में बताता है।
  6. TDS will be deducted at 10% on taxable interest income accrued above the threshold limit during the year as per Section 194A of the IT Act.
  7. पीएमएवाय - प्रधानमंत्री आवास योजना का उद्देश्य समाज के कमजोर वर्गों को कम कीमत पर घर उपलब्ध कराना है। पीएम आवास योजना के बारे में जानने के लिए पढ़ें।
  8. As per income tax rules, the domestic companies should file Form 10-ID to exercise the option as per Section 115BAB.
  9. Check out the step by step process to submit form 10-IC of income tax.
  10. Union Budget 2022 will be announced on 1st February 2022 - Taxpayers are expecting key changes in direct and indirect taxes in the upcoming Budget 2022.
  11. Union Budget 2022 Highlights: PDF Download, Key Takeaways, Important Points: Get Union Budget 2022 Highlights & latest News Updates.
  12. Senior citizen above 75 years with only interest and pension income are exempted from filing ITR
  13. Union Budget 2021 Highlights: PDF Download, Key Takeaways, Important Points: Get Union Budget 2021 Highlights & latest News Updates.
  14. Budget 2021 Live Updates | Date, Expectations | Union Budget 2021 will be announced on 1st February 2021- Expectations from Budget 2021-22 include are WFH concessions, increase in deduction limit u/s 80C, a COVID-19 cess, boost for the hospitality industry, and reforms in the agriculture sector.
  15. UIDAI has announced the new form of Aadhar, i.e. Aadhaar PVC card. Aadhaar PVC card is a pocket-sized Aadhaar card which can be obtained from ordering on the UIDAI website.
  16. NSDL website & UTIITSL website have been authorized by the govt.to carry out PAN transactions on behalf of the Income Tax Department. Read this article to know how to apply for PAN Card & how to make changes or corrections in your Permanent Account Number.
  17. Know how to apply for Driving License Online by reading our step by step application process. Also, know the procedure to check the application status online.
  18. What is Form 26AS? Form 26AS is a statement that provides details of any amount deducted as TDS or TCS from various sources of income of a taxpayer. It also reflects details of advance tax/self-assessment tax paid, and high-value transactions entered into by the taxpayer.
  19. If you don't have Aadhaar card then you can download and keep it with you. Read on to know more on Aadhar card download with aadhaar number, Enrolment ID, Date of Birth and Name
  20. Find out Who can claim Income Tax Rebate u/s. 87A for FY 2017-18 and FY 2016-17. Know how to claim section 87A rebate in ClearTax Software.
  21. PAN Card Status Check Online - A step wise guide for how to check your PAN application status online. Read more about Tracking based on acknowledgement number and Name and Date of birth.
  22. Lost your PAN Card or do not have it with you? No, worries! Read this article to know your PAN / Permanent Account Number by Date of Birth & official name registered on the UIDAI website.
  23. At the time of a divorce or separation, the court may direct the spouse to pay the other in the form of spousal payments, also known as alimony. Read this article for more information.
  24. Income Tax Appellate Tribunal is a quasi-judicial appellate authority to hear income tax appeals arising from assessment orders, penalty orders or order of the CIT(A)
  25. Use ClearTax salary calculator to know your take home salary. Simply enter the CTC and bonus figures and get to know how much salary you can take to your home.
  26. A deeming provision is a section or clause of a statute, regulation or other legal instrument that states how something is to be treated or regarded.
  27. The Principal Commissioner or Commissioner of Income Tax has powers to reduce or waive penalty as per powers conferred under Section 273A(1), 273A(4), and 273AA of the Income Tax Act.
  28. A company can choose to distribute profits to the shareholders through two modes - dividend payout and buyback of shares. Read this article for more information.
  29. What provisions of the Income Tax Act apply to a blogger? Are any expenses allowable or does a blogger pay tax on Gross Income? Read this article for more information.
  30. Learn under what circumstances the powers conferred by Section 55A of the Income Tax Act can be used with the help of this article.
  31. you can make a donation to the PM CARES Fund for COVID-19 coronavirus pandemic. You can claim deduction for donation under section 80G of income tax Act
  32. Income-tax and other Liquidity Measures for Individuals: COVID-19
  33. Covid-19 - Latest News & Updates on GST, IT & MCA
  34. According to Section 194O, an e-Commerce operator is required to deduct TDS for facilitating any sale of goods or providing services through an e-Commerce participant. Read in detail here.
  35. FM Nirmala Sitharaman proposed the addition of Section 194K in the Finance Act during the Budget 2020. Read the article to understand the implications of section 194K.
  36. Income Tax Latest News,Notifications,Circulars & Announcement Updates.We decode and simplify all the income tax notifications regularly and its related information here.
  37. Section 80M has been inserted in the Finance Act by our FM Nirmala Sitharaman in the Union Budget 2020. Read our detailed article on section 80M.
  38. Union Budget 2020 Highlights: PDF Download, Key Takeaways, Important Points: Get Union Budget 2020 Highlights & latest News Updates,
  39. Budget 2020 Expectations will be presented by Finance Minister, Nirmala Sitharaman, on the 1st of February 2020. Read our expectations from the Union budget 2020 here.
  40. Section 269SU has been introduced by the income tax department and has prescribed certain modes of payment for any business establishment. Read more here.
  41. In the Union Budget 2019, the Finance Minister proposed the introduction of a scheme of faceless e-assessment. Read more about e-Assessment scheme 2019.
  42. The income tax department has prescribed guidelines for verification of suspicious transactions and bank transactions. Read more here.
  43. You can add previous years’ losses to your income tax return. The procedure to claim your previous year losses on www.cleartax.in is here.
  44. Your e-filing account will hold sensitive personal & income tax-related information. You can secure this account from frauds by activating an e-filing vault.
  45. An assessing officer may issue a notice under Section 143(2) if there is a discrepancy in the information in your returns. Read here to know more.
  46. A Partner's remuneration is taxable for a partner under Business Income. Read to know about the limit of remuneration allowed as a deduction for the firm.
  47. With the introduction of ‘e-verify’ facility, taxpayers can verify without logging into the e-filing portal. Read the article to know more.
  48. The Union Budget 2019 has introduced Section 194N for deduction of tax at source (TDS) on cash withdrawals exceeding Rs 1 crore. Read here to know more.
  49. Section 192 deals with tax deducted at source (TDS) on salary. Your employer will deduct TDS from the salary payable to you. Read here to know more.
  50. Before proceeding to link or pre-validate your bank account with your PAN on the e-filing website, it is necessary to update your PAN with your bank.
  51. The employees’ CTC is the gross amount, while the amount of salary one gets to take home is the net salary. Read here to know more about gross salary.
  52. Confused about how to enter the first name and surname while registering on the income tax e-filing portal? Use the convention as per your PAN card.
  53. Every taxpayer is assigned an assessing officer based on the place of employment/business/residence. Continue reading this article to know more.
  54. Tenants must deduct tax at the rate of 31.2% from the rent paid to an NRI. The deducted tax must be deposited to TAN once every quarter.
  55. Curious to know what the Income Tax Law consists of? Continue reading this article to know about all the components of the Income Tax law of India.
  56. Citizenship and resident status are two different concepts. Knowing the resident status of a person is essential as the taxation differs for non-residents.
  57. Individuals and Hindu undivided families with an annual income exceeding Rs 50 lakh per annum must file Schedule AL with ITR.
  58. Section 194D and Section 194DA under the Income Tax Act covers tax deduction at source (TDS) on insurance commission and life insurance premium payments
  59. Income Declaration Scheme 2016 allows an Indian citizen to disclose the undeclared income and pay the applicable taxes. Read here to know more.
  60. Download the applicable income tax utility either in excel or java format, fill the form, save changes, generate an XML file, and upload it on the website.
  61. Special allowance, a component of salary, is provided by the employer to employees, gets tax exemption to a certain extent. Read here to know more.
  62. Should you disclose the investment made in gold? What are the precautions you should take from a tax perspective? Read here to know the answers.
  63. The IT department has launched an Aaykar Setu app that facilitates taxpayers to understand taxation and much more. Read here to know more.
  64. Union Budget 2019 covered new reforms and schemes in agriculture, banking, education, women entrepreneurs, start-ups, among others. Here’s a detailed analysis of its impact on various sectors.
  65. Union Budget 2019: Highlights & Announcements - Nirmala Sitharaman presents Budget 2019 talks on Direct taxation, Electric vehicles, affordable houses have become cheaper. Petrol, diesel, imported gold and precious metals, imported paper and paper products including printed
  66. Union Budget 2019: Highlights & Announcements - Nirmala Sitharaman presents Budget 2019 talks on Direct taxation, Electric vehicles, affordable houses have become cheaper. Petrol, diesel, imported gold and precious metals, imported paper and paper products including printed
  67. An income tax assessee is a person who pays tax or any sum of money under the provisions of the Income Tax Act, 1961. Read here to know types of assessees.
  68. Income Tax Exemptions and Deductions are allowed to be claimed from taxable income,but tax rebate is allowed to be claimed from tax payable. Read more here.
  69. Section 194G deals with TDS on commission on sale of lottery tickets. In this article, we will discuss section 194G of the Income Tax act.
  70. Under section194IB, individuals or HUFs are liable to deduct TDS on rent, in case the rent exceeds Rs.50,000. In this article, we look at Section 194IB & 194IC of Income Tax act in detail.
  71. Budget 2019 India - Live Union Budget News & Updates - Get all the live news and updates on budget 2019. The Union Budget 2019 will be announced by FM Nirmala Sitharaman. Here are few things to expect from Indian Budget 2019.
  72. Budget 2019 Live Updates- By 2022 - 75th Year: Every rural family except those unwilling to take connection will have Electricity and Gas facility: FM
  73. Income Tax Slab & Tax Rates in India for FY 2021-22, FY 2022-23 - Latest income tax slabs and rates as per the union Budget 2022 presented on February 1st 2022.
  74. ITR 2 has been recently updated by the Income Tax Department for FY 2018-19. Read here to know the breakup of salary components in new ITR-2 and its reason.
  75. The Election Commission of India (ECI) is a self-governing constitutional body which oversees the election process in India as per the Constitution of India.
  76. A surcharge is an extra income tax to be paid by the taxpayers earning a higher income. Read the provisions of Marginal relief on surcharge with examples.
  77. Know how to apply for Driving License Online by reading our step by step application process. Also, know the procedure to check the application status online.
  78. Highlights of Union budget 2019, announcements by the finance minister, changes in GST, income tax rebate, pensions, agriculture and other sectors
  79. ClearTax has compiled a list of important budget-related terms with its definitions and understand the upcoming Budget 2019 with ease!
  80. Interim Budget 2019 - Get Live Updates by Piyush Goyal on Indian Budget 2019.
  81. Aadhar Download Guide: If you don't have Aadhaar card then you can download and keep it with you. Read on to know more on Aadhar card download in easy steps with aadhaar number, Enrolment ID, Date of Birth and Name
  82. Using Passport Seva Online Portal we can easily get a new passport or renew an existing one. Read on to know more about it & stepwise registration and login process.
  83. Passport is a very essential document & bringing it online has made it easier. Read on to know more about stepwise registration, online application login, renewal etc.
  84. URN or Update Request Number is a unique number allocated to you when you apply for correction in your Aadhar Data. Know more on how to check URN status online, Aadhar update etc.
  85. The Income Tax Department processes the income tax return only after they are filed and successfully verified by the taxpayer. Read on to know in more detail.
  86. City Compensatory Allowance or CCA is a type of allowance paid to employees working in Tier-1 cities in addition to basic salary. Know more on Comparison, Limit, Eligibility etc
  87. Dearness allowance is a component of take-home salary. Read on to know more about types, calculation, allowance for pensioners, & treatment under income tax
  88. EDLI is a government scheme which extends life insurance benefits to private sector employees. know more about its features, calculation & instructions on how to claim its benefits
  89. The Interim Budget contains detailed documentation of every expense to be incurred and every rupee to earned through taxes in the coming few months
  90. Budget 2019 will be the most crucial budget as it is an interim budget. Read here to know the expectations from this upcoming budget 2019.
  91. Besides the concept of dividend as generally understood, there are certain specified payments that qualify as a deemed dividend under income tax.
  92. Income tax assessment happens subsequent to the filing of income tax return. Read the types of Income tax assessment which an assessee can undergo.
  93. ClearTax just raised $50 million dollars led by Composite Capital. We are India's first to be funded by Composite Capital.
  94. Bonus stripping is one among the various mechanisms that some investors resort to for minimizing their taxes. Here are the tax implications of bonus stripping
  95. Many investors resort to Dividend Stripping while transacting in shares and mutual funds. There are certain tax implications to it. Read more.
  96. Many are unsure about whether the income tax laws in India levies tax upon inheritance of property. Read on to know about its implications and income tax on inheritance and subsequent sales.
  97. While filing return of income, it is important to make sure TDS details contained in Form 16 or Form 16A match with Form 26AS.
  98. Everyone registering under NPS can voluntarily opt for having an NPS Tier II account. Let us understand Tier II account in detail here.
  99. It is important that an income tax return is signed by persons who have been authorized to sign it. Read more to know who these authorized persons are
  100. Though agricultural income is exempt from income tax, the act has laid down a method to indirectly tax such income. This method or concept is called as the partial integration of agricultural income with non-agricultural income. Read more about the taxation of this income here.
  101. Know Notices and Intimations about Income Taxes on ClearTax
  102. Get help from ClearTax if you have received a notice under section 143(2) (for scrutiny of tax return) from the income tax department.
  103. Guide to requesting for a refund reissue
  104. Quickly check your Refund Status using this guide
  105. A notice from the IT department is not always a bad thing. Keep calm and read this guide first!
  106. Create rent receipts to submit as investment proof. Rent receipts for HRA. Create rent receipts to submit to HR/Payroll. Save income tax on rent.
  107. Salaried individuals who live in a rented house can claim House Rent Allowance or HRA to lower taxes. This can be partially or completely exempt from taxes
  108. Free Income Tax Calculator for Assessment Year (AY) 2015-16. An online tax calculation tool that tells you how much Income Tax you owe to the Income Tax Department with just a few clicks!
  109. You can enjoy both the tax benefits if the employer provides you with an HRA component as part of your salary and you are paying your home loan off
  110. Ask for your landlord's PAN if you are taking a house on rent and making a payment exceeding Rs 8,333 per month
  111. Income Tax slab tax rates for FY 2016-17 & FY 2017-18. The Income tax slab determines how much you will pay in taxes.
  112. This guide explains the Tax Credit Statement or Form 26AS
  113. A step-by-step guide to understanding how to pay income tax that is due