Saturday, 28 May 2011

No Income Tax Return below 5 Lakh Income

The Union Finance Minister Pranab Mukhejee said on Tuesday (24th May, 2011) that the salaried tax payers with an income less than Rs. 5 Lakh should not file Income Tax Return from the Assessment Year 2011-10 ( ie from the Financial year 2010-11). This was according to his budget proposal on the end of February, 2011 and it was not clear that the implementation of this proposal will be come in to effect from this year or only form the financial year 2011-12. But now it is clear that the effect of not filing income tax return for the income less than Rs. 5 lakh is from the financial year 2010-11 onwards.

When addressing the 27th annual conference of the Chief Commissioners and the Directors-General of Income Tax the Finance Minister said this and the further notifications will be issued later.

But the benefit of this will be available only to the tax payers that the whole income has been come under TDS (Tax Deducted at Source) and the whole tax should be deducted at source for the year. So this is applicable only for salaried tax payers, whose tax will be deducted at source. But if this salaried tax payer has any other income including bank interest, he or she should declare it to the employer and allowed him to deduct the tax accordingly. Then only, the taxpayer gets the benefit of non filing of income tax return. The Form No. 16 (TDS Certificate) will be considered as Income Tax return in such cases.

All other tax payers, the TDS are not being deducted wholly as per tax limit. Only a portion of the tax will be deducted as TDS. So this will not be applicable for them. In case of Salaried Tax payers, that the total income is less than Rs. 5 lakh, and the whole income of the tax payer come under TDS and the tax has been deducted properly, should not submit income tax return this year onwards.

This is really a great relief for salaried Tax payers and they can avoid difficulties of submitting income tax return every year. This will reduce the paper work of income tax department also and can give better service to other tax payers. To provide salaried taxpayers with better services, the Income Tax Department introduced SAHAJ, a simple and user friendly form, this year. It also came out with SUGAM for small taxpayers who avail themselves of the presumptive tax scheme.

Our opinion is that all salaried tax payers should take benefit of this declaration by disclosing their income from any other sources to the employer in time and allow him to deduct the income tax as per rule.

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  1. dear sir,
    how it will be assessed that without return self assessment tax deposited is true or false
    plz explain how it is justified

  2. does it apply to pensioner drawing monthly pension

  3. Just check that TDS is being deducted from pension, if the pension is beyond income tax limit. If you dont have any other income including interest and at the same time your pension is not more than the nil tax limit you should not file income tax return. The considereation of not filing income tax return up to Rs. 5 Lakh is only if your whole income tax has been deducted as TDS. Normally only in Salary the whole tax is being deducted. All other cases only a portion of tas is being deducted as TDS.

  4. In case of self assessment tax you must file return. This is only for salaried people who do not have any other income. (if salaried people has any other income they must disclose it to the employer and allow the employer to deduct tax for that income also for getting this benefit.) Others must submit return it they have taxable income. Here TDS ceritficate in Form No. 16 is considered as IT return. Only salary people get this form 16. Others will get Form 16A not form 16

  5. Only if your pension is getting after deducting proper income tax (TDS)

  6. It is indeed good that the government is simplifying filing of Returns.
    Pls also consider very Senior Citizens who have no salary and whose
    Taxable Income is within the threshhold limit, from exemption of filing
    Returns. They need it the most and is quite a strain on them to
    undertake the process. Besides this will free the overworked IT staff
    to concentrate more on other cases. Thanks

  7. [...] should be generated and downloaded from the Tax Information Network (TIN) … Continue reading ? No Income Tax Return for income below 5 Lakh from FY 2010-11 The Union Finance Minister Pranab Mukhejee said on Tuesday (24th May, 2011) that the salaried tax [...]

  8. does the income means whether total income or taxable income? Please reply. Thanks....Sukumaran

  9. When the notification came it was written the taxable income. But now the experts says that it is gross total income