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Filing of Income Tax Return - 2

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Overview

ITR-2 is an income tax return form filed by individuals who are not eligible to file ITR-1. It means the individuals who have incomes from salary, pensions, capital gains, foreign assets, businesses (as a partner), or any other sources will file the ITR-2 form. The individuals whose income exceeds fifty lakhs will file ITR-2, as they do not fit the criteria of ITR-1.

Eligibility to File ITR-2 online for AY 2020-21:

The taxpayers eligible to file ITR-2 are the individuals whose source of income is as follows:

1) Any individual having income more than Rs. 50 lakhs

2) Any income from assets outside India

3) Signing authority in any account outside India

4) Any Non-resident

5) Individuals having agricultural income more than INR 5000

6) income from lottery, horse race, gambling

7) Short and long term capital gains

Taxpayers who are not eligible for filing ITR-2:

1) The taxpayers who have incomes from business or profession do not have to file ITR-2.

2) Taxpayers who are eligible for ITR-1 do not require filing ITR-2.

Due dates for filing ITR-2 online AY 2020-21:

Any individual eligible to file ITR-2 must file it on or before 31st July. This date is the last date for filing ITR-2. 

Note :-

IT department has extended the due dates of AY 2020 till 30th November 2020.

Advantages

1. ITR receipt is a precious document

When you file your income tax returns, the income tax department provides you a receipt in return. This receipt is a precious document. It contains more detailed data as compared to Form 16. Thus, filing your income tax returns helps you record all your taxations with revenue from different sources.

2. ITR receipt serves as address proof

When an individual files his/her income tax returns, the IT department sends the receipt to the registered address of the person/ entity. Thus, it serves you as your residential proof. You can show it as your proof of address in organizations like banks and NBFCs. 

3. Easy processing of bank loans

Filing your income tax returns offers you various benefits to avail loans. One such is easy processing of bank loans. When you apply for a bank loan, the bank will verify your eligibility. Thus, filing income tax returns makes it easier for you to avail any loan. The returns act as a strong document. It shows the poof of income to the loan provider. 

Whether it is a house credit, personal mortgage, or vehicle loan, you can show provide the copies of your ITR statements for easy processing of the bank loans.

4. Compensation of the losses in the next financial year

Until you file your income tax returns, you cannot compensate for your losses to the next financial year. According to the IT Act, if you do not file your income tax returns on time, your losses will not be adjusted. You cannot compensate losses for the next financial year. Thus, to ensure that you compensate your losses, you must file your Income-tax returns on time. 

5. Avoid extra interests

If you don’t file your income tax returns on time, you will be liable to pay extra interest 1% on the tax as a penalty. This penalty shall keep on adding until you file your returns. For example, a bank deducts taxes at source from the interest of the fixed deposit. In order to claim the refund of the TDS, you must file your taxable income. In case you don’t file your returns then you have to pay extra interest on the deposits, 

6. Avoid penalties

As per the IT Act, if an individual doesn’t file income tax returns on time, he/she will be held liable to pay the penalty up to INR10, 000. and this penalty shall keep on adding until you file your returns.

7. Easy credit card processing

When you apply for credit cards, the banks usually verify your income tax returns. So, if you don’t file your income tax returns, the bank may reject your credit card application. 

8. Hassle-free visa processing 

Sometimes the Visa Authorities may ask you the documents of your past tax returns. Thus, if you are applying for Visa, you must file your income tax returns on time. Filing the IT will eliminate all the hassles in Visa applications. You can get a Visa easily. 

9. Helpful for the freelancers and independent professionals 

The individuals who are independent professionals or freelancers don’t have form 16. Thus it might get difficult for them to avail of any financial benefits. Income tax returns are the only document that shows the proof of income for them. Thus, if you are freelancers or independent professional, you must file you ITR without wasting time. It will eliminate the funding issues and transactional problems.

Disadvantages

1. Interest loss on refunds: 

When you file for a refund in your tax returns that you paid in advance, you will lose some interest in filing your ITR late

2. Losses will not carry forward: 

If you file ITR-2 after the due dates, your losses will not be carried forward except house property losses.

3. Penalties: 

Filing the ITR late also results in a penalty of interest 1% per month. The penalty starts from the due date and continues until you make the payment.

Document Required

Form-16: 

  • Form 16 is the essential documents for salaried individuals. It shows the details on TDS deductions made by the employer. You should attach form 16 with all the details

Salary slips: 

  • Salary slips are also essential documents needed to file ITR-2. It states details about allowances like house rent allowance, transport allowances any many more that are taxable.

Interest certificate from banks or post office: 

  • These certificates show the details on interests received from savings accounts, fixed deposits, and recurring deposits. If you don’t get an interest certificate, you can also show your updated bank passbook with all details about Interest

Form 16A, 16B, 16C: 

  • form 16A shows the details about the TDS deducted by the employer. On the other hand, if you sell your properties, form 16B will show the TDS deducted from the payment you received.

The form 16C

  • shows the details on TDS deducted from rents.

Form 26AS: 

  • Form 26AS shows the consolidated annual tax. It included advance taxes, self-assessment taxes, TDS deduction by an employer, TDS deducted by a bank if the interest income is more than INR 10,000. It also includes TDS deducted by any other organization that has paid you.

Tax-saving investment proof:  

  • it shows the detail about every tax saving investment that you have made. It includes EPF, PPF, mutual funds, life insurance, and the national pension system.

Deduction under section 80D-80U 

  • shows the detail on deductions made under different sections of the IT Act. It includes health insurance premiums, Interest on education loans.

Home loan statement from Banks or NBFC: 

  • if you have taken any home loan from banks or NBFCs, you should add a statement.

Capital gains 

  • from the sale of a property or mutual funds.

Aadhar card.

Time Lines

  • (1 to 2 Days)
  • Purchase the Service
  • Upload / send the Documents
  • Discussion with expert
  • Filing of application with department
  • Receipt of Acknowledgement
  • Confirmation to client

Service Covered

Pricing for what you want required service

Basic

2450*
  • Expert Consultation
  • Persons having DIN or having private limited company shares.

Business

3450*
  • Expert Consultation
  • Persons having DIN or having private limited company shares and capital gains.

Enterprise

4950*
  • Expert Consultation
  • Persons having DIN or having private limited company shares, capital gains and foreign assets or foreign income.
  • Notes:
  • * This price is inclusive of all Govt filing fee and excluding GST amount.

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