Corporate ITR filing For Employees

Discover the easiest procedure for filing income tax returns online, for salaried employees. There are certain documents required for income tax return filings for salaried staff.

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What are Income Tax Return Services?


An Income Tax Return form is required to be filed with the Income Tax Department. Income tax for salaried individuals is calculated on a percentage of income earned by an individual. According to the rules, there are different tax slabs, based on income, ranging from 10 % to as high as 30%.

Income tax return services commence after your Chartered Accountant has done all deductions and made deposits to the Income Tax Department. The tax laws can be a bit complicated, this is why companies outsource filing of income tax returns to companies like Vakilsearch.

Benefits of Filing Income Tax Returns


Avoid Fines

Filing an income tax return is legally mandatory for individuals, and failure to do so can levy a fine of Rs 10,000 if your annual income is more than Rs. 5 Lakh.

Proof Of Tax Payments

Receipts from ITR filing serve as proof for your income and tax payments.

ITR Receipts for Bank Loans

When approaching banks for loans, most ask for income tax return receipts for the last three years, as they serve as reliable proof of a person’s income.

Visa processing

When securing VISA for countries like the United States, United Kingdom, Canada, and Australia ask to furnish past ITR receipts, as they are very particular about your tax compliance. ITR receipts help in assessing an individual's income and ensure to meet his/her travel and accommodation expenses.

When Should you File ITR?

An ITR or Income Tax Return is essentially a form that taxpayers file to the Income Tax Department which contains information regarding the income earned and tax applicable. The IT department has issued several ITR forms such as ITR 1 through ITR 7, and every citizen should file the form that is applicable to them before the specified due date. The applicability of the form largely depends on the income source, the amount earned, and the category under which it falls. However, it is mandatory to file the appropriate ITR in India, as per the following conditions:

  • If gross annual income exceeds;
    • Individuals under 60 years - INR 2.5 Lakh
    • Individuals between 60 and 80 years - INR 3.0 Lakh
    • Individuals above the age of 80 years - INR 5.0 Lakh
  • If there are multiple sources of income such as capital gains, salary, and property.
  • If a tax refund is claimed.
  • If an investment has been made on foreign assets, and returns have been received.
  • In case of an application for a visa or loan
  • If the ITR is filed by a company, partnership, organisation or firm.

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Checklist for what is Income Tax Slab Rates, for Income tax return 2019 - 2020


  • For salaried individuals earning up to Rs.2,50,000 - NIL
  • For salaried individuals earning between Rs.2,50,000 and up to Rs.5,00,000 - 5 %
  • For salaried individuals earning between Rs.5,00,000 and up to Rs.10,00,000 - 10 %
  • For salaried individuals earning above Rs.10,00,000 – 10 %

Which ITR forms are required to be filed?

ITR-1/SAHAJ

This form must be filed by individuals whose income include the following:

  • Salary/ Pension
  • One house property, if there is no carry-over loss from previous years
  • Other income sources, excluding lottery and race horses
  • Agricultural income extending up to INR 5000

In case, agricultural income exceeds Rs 5000, or total gross income exceeds Rs 50 lakhs, then IT returns cannot be filed via Form-1. Furthermore, if income is from taxable capital gains, businesses or multiple properties, they will have to be entered in other forms. Third, directors of companies and people with unlisted equity shares or foreign assets cannot file SAHAJ.

ITR-2

ITR 2 may be used by individuals or Hindu Undivided Families whose income includes:

  • Salary/Pension
  • House Property
  • Other Sources including Lottery and Race Horses
  • If you are a Director of a company
  • Unlisted equity shares
  • Capital Gains
  • Foreign Assets
  • Agricultural income exceeding INR 5,000

However, people whose income comes from a business or Profession cannot use this form to file their returns.

ITR-3

The ITR3 Form may be used by individuals or HUFs whose income comes from a business or profession. Therefore, it includes incomes from the following sources:

  • Business or profession
  • Individual Director
  • Unlisted equity shares
  • House property
  • Salary/Pension
  • Other sources
  • Partners in firms

ITR-4/Sugam

The ITR4 Form may be used by individuals, HUFs and Partnership Firms, excluding LLPs whose income comes from a business or profession. This also includes those people who have opted for the presumptive income scheme as mentioned under Section 44AD and 44AE of the Income Tax Act. However, if total turnover exceeds Rs 2 crore, they must go for ITR-3. Also, if your individual income exceeds Rs 50 lakh, you have incomes from multiple properties or you own a foreign asset, you cannot file your returns via this form.

ITR-5

ITR 5 is used by LLPs, AOPs, BOIs, AJPs, Estate of deceased and insolvent, Business trusts and investment funds to file their returns.

ITR-6

Companies claiming exemption under section 11, can file their returns using Form 6.

ITR-7

This form may be used by individuals and companies which come under the following Sections of the Income Tax Act:

  • Section 139(4A)- Income from a property that belongs to or comes under the jurisdiction of a charitable or religious organisation.
  • section 139(4B)- Political parties whose total income exceeds the maximum amount which is not taxable
  • Section 139(4C)- Research associations, news agencies, institutions, hospitals and associations as defined under Section 10(23 A and B)
  • Section 139(4D)- Every university, college, and institution
  • Section 139(4E)- Business trusts
  • Section 139(4F)- Investment fund as mentioned in Section 115UB.

Procedure for Income Tax Return Filing

E-filing of income tax can be executed online through the IT Department’s website. The steps are pretty simple, but calculations can be a bit taxing. You need to follow the below-mentioned steps for e-filing of income tax.

  • Fill The Form
  • Complete Payment Procedure
  • Provide Challan
  • Acknowledgment file, ITR Verification (ITR-V)

Vakilsearch’s Corporate IT Returns package services for Employees

  • 100% Assistance with filing employee IT Returns
  • Advice on how to reduce their tax liability
  • 24/7 customer service to assist in all your queries
  • Assurance of complete data security
  • Expertise in tax calculations
  • Submission of all forms and validations to the IT Department

Documents needed for Filing Income Tax Returns

  • PAN CARD
  • Form 16 issued by Employer
  • Home loan or HRA receipts
  • Form 26AS which shows tax credits to your account
  • Proof of investments for tax savings
  • Aadhar Card OTP for downloading ITR receipt
  • Income Tax Return Form ITR 1
  • Bank account details
  • Rent receipts for claiming HRA

Consequences of Missing the Due Date

In case, companies fail to file the ITR returns of their employees by 31st July, they can still file a “belated return” by the 31st of March. However, that results in the following consequences.

  • Interest: If the individual needs to pay tax, even after reducing their TDS, then it must be paid as advance tax. A shortfall in the payment of advance tax leads to individuals having to pay it as a self-assessment tax. This comes along with an interest of 1% every month on the due amount and till the amount is paid.
  • Penalty: If the taxpayer fails to file returns before the due date, he or she will have to pay the following fines:

If the payment is made between August and December, then individuals whose total income falls below INR 5 lakhs have to pay a penalty of INR 1000, while those whose total income exceeds INR 5 lakhs, must pay INR 5000. Further delay, results in a fine of INR 1000 for people with total income less than INR 5 lakhs, while those exceeding that amount will have to pay a penalty of INR 10,000.

  • Carry forward of losses: Losses under capital gains can be carried forward only if the taxpayer has filed the concerned IT returns within the specified due date.
  • Prosecution for not filing: The income tax officer can initiate prosecution proceedings if the taxpayer fails to pay the due amount of time. The charges concerning dues exceeding INR 3000 once proved, can lead to imprisonment for 3 months to a maximum of 2 years. If the tax payable amounts to more than INR 25 lakh, imprisonment may last up to 7 years.

FAQs on Corporate IT Returns

You could, but the tax laws are a little difficult to understand for a lay person. Our experts help you reduce your tax liability by filling in all the relevant details needed. We also help you pick the right forms to fill based on the income group you belong do.
The tax laws state that it is compulsory for all tax filers to e-verify their returns. Each employee must do this by post or do it online using the Aadhar OTP system. If they fail to e-verify the returns, the return filing process is invalid.
The Form-16 must be prepared by the accounts team based on tax deducted at source during the year.
No, they do not need to file income tax if they earn less than Rs. 2.5 lakh as the tax slab for such earning is NIL.

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