Before filing ITR Taxpayers must know 6 things: If you also do a job and are going to file an income tax return, then you should keep some important things in mind. Apart from salary income, you also have many types of income, which are taxed. But you either forget it or you feel that you do not have to pay tax on them. But here we will tell you that you should not let a single penny of your earnings sink. Let us tell you what things you should take special care of Before filing ITR.
First of all the interest received on Saving bank account
Keep in mind, it is very important for you to put the interest received on the savings bank account in your income tax return. Tax exemption is available under Section 80TTA of Income Tax on interest received up to Rs 10,000 annually. But it has to be shown in earnings, only then you can claim this exemption.
The interest of Bank Fixed Deposit
Your bank will also deduct TDS on this interest and you have to disclose this income as income in the return as well. When the earning on FD exceeds Rs 40,000, then the bank deducts TDS. But this limit is for people below 60 years of age. Senior citizens can avail exemption under section 80TTB on the income earned on FD, which has a limit of Rs 50,000. But it also includes a savings bank account.
Before filing ITR: Understand the whole process here
Gains of Mutual Fund
Capital gains tax has to be paid on the gains from Mutual Funds. Long Term or Short Term will depend on how long you have held the units and when you redeemed them. On selling after one year in Equity Mutual Funds, 10% tax on gains of 1 lakh is redeemed within one year. Short-term capital gain tax will be applicable at the rate of 15%.
According to the new rules of Income Tax, now whenever the investors get the dividend, it will be added to their income and tax will have to be paid on it according to the tax slab. Earlier companies used to take Dividend Distribution Tax on Dividend. But now it will be added to the income of the investors.
Minor child’s income
Suppose you have made any investment in the name of your child, then it will be considered as his income. And this earning will be added to the income of the parents. Or maybe you are getting interest from somewhere, or you have redeemed the Mutual Fund Unit. So whatever will be the gain, it will be clubbed in the income of the parents. Keep in mind that the income of the child will be added to the income of the parent whose income is high.
If you have more than two houses and you are getting rent from the third house or if you are living there…whatever it is..you will have to pay taxes accordingly. Taxpayers do not have to pay any income tax on 2 self-occupied houses. The third house is called Deemed Let Out Property. And accordingly, the tax liability will be made.