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Your Queries (Income Tax): Aggregate of all dividend income taxable under ‘other sources’

In this article, we are looking at some of the most common questions that come to one’s mind while filing Income Tax. Here we will cover the aggregate of all dividend income taxable under other sources.

From FY 2020-21, is the stated dividend on shares taxable? The dividend amount I got on shares is reported in Form 26AS, but no TDS is shown. If the dividend amount is less than Rs 5,000, is TDS deducted?

Dividends declared and dispersed on or after April 1, 2020, are taxable in the hands of the shareholders who received them. If the amount received in a year exceeds Rs 5,000, the dividend income is subject to a 10% TDS.

When submitting an ITR, you must state the total amount of all dividend income obtained during the fiscal year under the heading “other sources”. The TDS deducted (as shown on Form 26AS) will be granted as a credit against the ultimate tax liability.

Income Tax
My employer's gross salary for AY2021-22 is Rs 8 lakh. In Part B, there is no distinction between basic/DA and HRA. Is it possible to show my salary in several sections in order to claim a refund and file an ITR-1?

Allowances that have not been received must not be claimed as deductions or exemptions. While filing the ITR, one must only fill in the genuine and correct income details. You can invest in tax-saving products to save money on taxes. Individuals who do not get HRA may also recover rent paid under Section 80GG, subject to the limitations and criteria set forth therein.

There are two types of dividends in ITR-2 for AY 2021-22. Which of these applies to dividends received from Indian stocks?

Dividend income from Indian firm shares held as an investment is taxable under the heading “other sources,” and you must disclose it in your income tax return as dividend income [other than (ii)].

My yearly pay is less than Rs 50 lakh. Mutual funds provide long-term financial gains, while tax-free bonds and PPF provide interest. I'm not sure which ITR form to use.

You may include information on income obtained in ITR-2 for FY21. ‘Schedule CG’ records the Long-term capital gains. Whereas ‘Schedule OS’ records interest income, i.e. income from other sources. Moreover, one must record, the Interest income from tax-free bonds and PPF as exempt income in Schedule EI of ITR.

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What to look for, while filing an Income Tax return this year.

The Income-tax department of India introduces some changes in the Income-tax filing process every year. The taxpayers need to be aware of these changes. It is better to have awareness and make no mistakes in the tax filing process or the tax forms.

The Income tax is levied on the income earned in India, by all the individuals, partnership firms, and corporates as per the Income-tax Act of India. In the case of individuals, if their income is above the minimum threshold limit. The tax is levied as per the slab system given by the Income Tax Department of India.

Income Tax Slab

tax return

In India, a slab system governs the tax levied on an individual taxpayer. A slab system means different tax rates for different income ranges. Tax slabs generally increase the tax rates as the income increases; this system ensures fair taxation in the country. These income tax slabs go through certain changes every financial year.

Whether you are filing a tax return for the first time or if you’ve been in the game for long. It is advisable to keep an eye on these factors while filing your tax return for FY 2020-21.

Income Tax Slab Rates for the Financial year 2020-21 (AY 2021-22)

In this new regime, taxpayers have options to pay their income taxes as per the new regime or to continue with the old regime. The new regime offers to tax at a lower slab rate but the taxpayer has to forgo various deductions and exemptions available under the old regime. Or, The assessee can continue with the rebates and exemptions by staying in the old regime and paying tax at the existing higher rate.

It is advisable that the taxpayers must choose their regime at the beginning of the year. However, if you were not able to make the planned investments or expenses against which you could claim the tax deduction under the old regime. You can switch to the new one if it is resulting in lower liabilities for you.

Extension of date

The last date for filing ITR (Income Tax Return) is extended to 30 September. However, it doesn’t provide any relief from the tax liabilities. If you have an advance tax due, you may need to pay the penal interest. Hence, it makes sense to file the ITR as soon as possible. This will also help in the faster processing of your tax refunds.

Changes in tax forms

The tax department notifies about the income tax forms every year after incorporating any changes. Therefore, It is necessary to be aware of these changes in order to choose the right ITR form.

This year, there are certain changes introduced within the eligibility criteria of ITR 1, which is generally used by salaried taxpayers.. For this year, A person can not file ITR 1, if their TDS (Tax Deducted at Source) has been deducted for cash withdrawal under Section 194N. Or if the person has deferred tax on employee stock options (ESOPs) received from the employer.

Unclaimed deductions

In case you forgot to submit the proof of investments like life insurance, or health insurance premium with your employer and the tax has already been deducted. You can still claim these deductions at the time of filing ITR and claim a refund of the tax paid.

To ease the process, it will be better to collect all the documents like Form 16, Form 26AS and bank statements before filing your Income Tax Return.

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New Income Tax Portal!

Isn’t it exciting! Income Tax has launched a new portal for e-filing. It is named ‘e-filing2.0’. What are the new changes? Will it be easier to use than the previous one. Let’s discuss and learn more about it.

Income Tax Portal is in its initial stage, So there may be some issues sometimes like delay in opening the website, slow in filling the detail. So if you are facing these issues and worried about how to file your returns, you can choose the offline option for now. Infosys has said and regretted these glitches. The new URL for the website is www.incometax.gov.in.

About Portal

Despite all these glitches, the new portal is very much sorted in comparison to the previous one. Representation of the portal is very effective. Additionally, there are many videos for awareness about different income tax topics and processes. You will find some sections like:

  • Dashboard
  • e-file
  • Authorized Partners
  • Services
  • Pending Actions
  • Grievances
  • Help

For News and updates, you have to scroll down and access the folder. All the resources are mentioned for ITR related problems.

How to Log In?

As for the user id, you can use the PAN card number or the Aadhar number which is linked. Thereafter, you will receive an access message. After that entering your password you will be completely logged in.

You will need to update your profile step by step. You will find a dashboard and a Modified “You ask and we Answer” section in it. By clicking on this section you can ask all the queries related to income tax file returns and other services provided. you will not need any professional guide for the problems, only by visiting and learning the portal you will be able to do all of it by yourself.

Modes

This is the main attraction of the portal in comparison to the previous portal. It is very much user-friendly now. You will need to select a mode of filing to proceed. There are two modes mentioned in the portal

  • Offline (using HTML utility)
  • Online (recommended)

You will then need to choose your type of income tax form according to your income. If you do not know which type of form you should fill then help is there to help you out. Some beneficial services will be available only when the profile update is done 100%. The new portal also includes all-new mobile app services for tax-related issues. File your returns now in a more easy manner!

For more updates like these, keep watching this space!