Instructions to Form ITR-1 (A.Y. 2021-22)

Instructions for filling ITR‐1 SAHAJ A.Y. 2021‐22

General Instructions

These instructions are guidelines to help the taxpayers for filling the particulars in Income tax Return Form‐1 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year 2021‐22 only, i.e., it relates to income earned during the Financial Year 2020‐21.

2. Who is eligible to use this Return Form

This Return Form is to be used by an individual who is a resident other than not ordinarily resident, whose total income for the Assessment Year 2021‐22 does not exceed Rs. 50 lakh and who has income under the following heads:‐

(a) Income from Salary/ Pension; or
(b) Income from One House Property; or
(c) Interest income and/ or family pension taxable under Other Sources.
NOTE:

Further, in a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used only if the income being clubbed falls into the above income categories.

3. Who is not eligible to use this Return Form?

A. This Return Form should not be used by an individual who ;
(a) is a Director in a company;
(b) has held any unlisted equity shares at any time during the previous year;
(c) has any asset (including financial interest in any entity) located outside India;
(d) has signing authority in any account located outside India; or
(e) has income from any source outside India.
(f) has deferred tax on ESOP received from employer being an eligible start‐up.
(g) has withdrawn cash and TDS has been deducted u/s 194N on such withdrawal.
B. This return form also cannot be used by an individual who has any income of the following
nature during the previous year:‐Instructions to Form ITR-1 (A.Y. 2021-22)
(a) Profits and gains from business and professions;
(b) Capital gains;
(c) Income from more than one house property;
(d) Income under the head other sources which is of following nature:‐
(i) winnings from lottery;
(ii) activity of owning and maintaining race horses;
(iii) income taxable at special rates under section 115BBDA or section 115BBE;
(e) Income to be apportioned in accordance with provisions of section 5A; or
(f) Agricultural income in excess of ₹5,000.
C. Further, this return form also cannot be used by an individual who has any claims of loss/deductions/relief/tax credit etc. of the following nature:‐
(a) any brought forward loss or loss to be carried forward under the head ‘Income from house property’;
(b) loss under the head ‘Income from other sources’;
(c) any claim of relief under section 90 and/or section 91;
(d) any claim of deduction under section 57, other than deduction under clause
(iia) thereof (relating to family pension); or
(e) any claim of credit of tax deducted at source in the hands of any other person.

4. Annexure‐less Return Form

No document (including TDS certificate) should be attached to this Return Form. All such documents enclosed with this Return Form will be detached and returned to the person filing the return.

5. Key changes (as compared to ITR for AY 2020‐21)

(a) Option to avail benefit of new tax regime u/s 115BAC is provided in ITR‐1. Option should be availed within due date mentioned as per section 139(1).
(b) ITR 1 cannot be filed by the assessee who is having TDS u/s 194N.
(c) Resident Individual having Income‐Tax deferred on ESOP is restricted to file ITR‐1
(d) Quarterly breakup of dividend income to be provided.
(e) Schedule DI is removed.
(f) Date of Donation made in cash has inserted to calculate eligible amount of donation u/s 80GGA

6. Manner of filing and Verification of this Return Form

This Return Form can be filed with the Income‐tax Department in any of the following ways:‐
Instructions to Form ITR-1 (A.Y. 2021-22)
A. electronically on the e‐filing web portal of Income‐tax Department
(www.incometaxindiaefiling.gov.in) [www.incometax.gov.in from 7‐June‐ 2021] and verified in any one of the following manner –
(i) digitally signing the verification part, or
(ii) authenticating by way of electronic verification code (EVC), or
(iii) Aadhaar OTP, or
(iv) by sending duly signed paper Form ITR‐V ‐ Income Tax Return
Verification Form by post to CPC at the following address –
“Centralized Processing Centre,
Income Tax Department,
Bengaluru— 560500,
Karnataka”.

The Form ITR‐V ‐ Income Tax Return Verification Form should reach within 120 days from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

B. in paper form, at the designated offices of Income‐tax Department, along with duly signed Form ITR‐V. This mode of furnishing return is permissible only in case of super senior citizens (i.e. an individual of the age of 80 years or

more at any time during the previous year).

7. Filling out the ITR V‐ Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 5A(iv) above, the assessee should print out Form ITRV‐ Income Tax Return Verification Form. ITRVIncome Tax Return Verification Form, duly signed by the assessee then has to be sent by ordinary post or speed post only to Central, Processing Centre, Income Tax Department, Bengaluru‐ 560500 (Karnataka).

Instructions to Form ITR-2 (AY 2021-22)

Instructions for filling out FORM ITR‐2

These instructions are guidelines for filling the particulars in Income‐tax Return Form‐2

for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of any doubt,

please refer to relevant provisions of the Income‐tax Act, 1961 and the Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only, i.e., it relates to income

earned in Financial Year2020‐21.

2. Who is eligible to use this Return Form?

This Return Form is to be used by an individual or a Hindu Undivided Family (HUF) who is

not eligible to file Form ITR‐1 (Sahaj) and who is not having any income under the head “Profits

or gains of business or profession”.

3. Who is not eligible to use this Return Form?

This Return Form should not be used by an individual whose total income for the

Assessment Year 2021‐22includes Income under the head “Profits or Gains of Business or

Profession”.

4. Manner of filing and verification of this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the efiling

web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following manner –

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form by

post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V – Income Tax Return Verification Form should reach within 120 days from

the date of e‐filing the return.The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

Instructions to Form ITR-3 (A.Y 2021-22)

Instructions for filling out FORM ITR‐3

These instructions are guidelines for filling the particulars in Income‐tax Return Form‐

3 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of any

doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Income‐tax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only, i.e., it relates to income earned in Financial Year2020‐21.

2. Who is eligible to use this Return Form?

This Return Form is to be used by an individual or a Hindu Undivided Family who is having income under the head “profits or gains of business or profession” and who is not eligible to file Form ITR‐1 (Sahaj), ITR‐2 or ITR‐4 (Sugam).

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the efilingweb

portal of Income‐tax Department (www.incometaxindiaefiling.gov.in) [www.incometax.gov.in from 7‐June‐2021]and verified in any one of the following manners –(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form

by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within 120 days

from the date of e‐filing the return.The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

However, in a case where accounts are required to be audited u/s 44AB, it is

mandatory to verify the return electronically under digital signature.In case an assessee is required to furnish a report of audit under sections 10AA, 44AB,44DA, 50B, 80 ‐IA, 80‐IB, 80‐IC, 80‐ID, 80JJAA, 80LA, 92E, 115JB or 115JC, he shall file such report electronically one month before the due date of filingof return of income.

4. Filling out the ITR V‐Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 3(iv), the assessee

should print out Form ITR‐V‐Income Tax Return Verification Form. ITR‐V‐Income Tax Return

Verification Form, duly signed by the assessee, has to be sent by ordinary post or speed post

Instructions to Form ITR-3 (A.Y 2021-22) only to Centralized Processing Centre, Income Tax Department, Bengaluru–560500 (Karnataka).

Instructions to Form ITR-4 (A.Y. 2021-22)

Instructions for filling ITR‐4 SUGAM A.Y. 2021‐22

General Instructions

These instructions are guidelines to help the taxpayers for filling the particulars in Incometax

Return Form‐4 for the Assessment Year 2021‐22 relating to the Financial Year2020‐21.

In case of any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the

Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for Assessment Year 2021‐22 only, i.e., it relates to income

earned during the Financial Year 2020‐21.

2. Who is eligible to use this Return Form

This Return Form is to be used by an individual or HUF, who is resident other than not

ordinarily resident, or a Firm (other than LLP) which is a resident, whose total income for the

assessment year 2020‐21 does not exceed Rs.50 lakh and who has income under the

following heads:‐

(a) Income from business where such income is computed on presumptive basis under

Section 44AD (i.e. Gross Turnover upto Rs. 2 crore) or Section 44AE (income from

goods carriage upto ten vehicles); or

(b) Income from Profession where such income is computed on presumptive basis under

Section 44ADA (i.e. Gross receipt upto Rs. 50 lakh); or

(c) Income from Salary/ Pension; or

(d) Income from One House Property; or

(e) Interest income and / or income from family pension taxable under Other Sources.

Note 1: The income computed on presumptive basis under sections 44AD or 44AE or 44ADA

shall be presumed to have been computed after giving full effect to every loss, allowance,

depreciation or deduction under the Income‐tax Act. However, person having loss after

giving effect to proviso to sub‐section 3 of Section 44AE shall file ITR5

Note 2: Further, in a case where the income of another person like spouse, minor child, etc.

is to be clubbed with the income of the assessee, this Return Form can be used only if the

income being clubbed falls into the above income categories.

3. Who is not eligible to use this Return Form
4. This Return Form should not be used by a person who –

(a) is a Director in a company;

(b) has held any unlisted equity shares at any time during the previous year;

(c) has any asset (including financial interest in any entity) located outside India;

(d) has signing authority in any account located outside India; or

(e) has income from any source outside India.

(f) has deferred tax on ESOP received from employer being an eligible start‐up.

1. This return form also cannot be used by a person who has any income of the

following nature during the previous year:‐

(a) Profits and gains from business and professions which is not required to be

computed u/s 44AD, 44ADA or 44AE, such as income from speculative business,

agency business, commission or brokerage income etc.;

(b) Capital gains;

(c) Income from more than one house property;

(d) Income under the head other sources which is of following nature:‐

(i) winnings from lottery;

(ii) activity of owning and maintaining race horses;

(iii) income taxable at special rates under section 115BBE;

(e) Income to be apportioned in accordance with provisions of section 5A; or

(f) Agricultural income in excess of ₹5,000.

1. Further, this return form also cannot be used by a person who has any claims of

loss/deductions/relief/tax credit etc. of the following nature:‐

(a) any brought forward loss or loss to be carried forward under any head of income;

(b) loss under the head ‘Income from other sources’;

(c) any claim of relief under section 90, 90A or section 91;

(d) any claim of deduction under section 57, other than deduction under clause (iia)

thereof (relating to family pension); or

(e) any claim of credit of tax deducted at source in the hands of any other person

4. SUGAM form is not mandatory

Form ITR‐4 (Sugam) is a simplified return form to be used by an assessee, at his option, if he

is eligible to declare profits and gains from business and profession on presumptive basis

under section 44AD, 44ADA or 44AE. However, in case the assessee keeps and maintains all

books of accounts and other documents referred to in section 44AA, and also gets his

accounts audited and obtains an audit report as per section 44AB, filling up the Form ITR‐4

(Sugam) is not mandatory. In such a case, other regular return forms viz. ITR‐3 or ITR‐5, as

applicable, should be used and not this Form.

Instructions to Form ITR-5 (A.Y. 2021-22)

 

Instructions for filling out FORM ITR‐5

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐5 for the Assessment Year 2021‐22 relating to the Financial Year2020‐21. In case of

any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22 only, i.e., it relates to

income earned in Financial Year 2020‐21.

2. Who is eligible to use this Return Form?

This Form can be used by a person being a firm, Limited Liability Partnership (LLP),

Association of Persons (AOP), Body of Individuals (BOI), Artificial Juridical Person (AJP)

referred to in clause (vii) of section 2(31), local authority referred to in clause (vi) of

section 2(31), representative assessee referred to in section 160(1)(iii) or (iv),Primary

Agricultural Credit Society, Co‐operative Bank other than a primary agricultural credit

society or a primary co‐operative agricultural and rural development bank, Primary Cooperative

Agricultural and Rural Development bank, any other cooperative society, society

registered under Societies Registration Act, 1860 or under any other law of any State, trust

other than trusts eligible to file Form ITR‐7, estate of deceased person, estate of an

insolvent, business trust referred to in section 139(4E) , investments fund referred to in

section 139(4F) and Any other AOP /BOI.

However, a person who is required to file the return of income under section

139(4A) or 139(4B) or 139(4D)shall not use this form.

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the

e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following manner

–

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form

by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within 120 days

from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be

sent to the assessee on e‐mail ID registered in the e‐filing account.

Instructions to Form ITR-5 (A.Y. 2021-22)

However, in a case where accounts are required to be audited u/s 44AB, it is

mandatory to verify the return electronically under digital signature.

In case an assessee who is required to furnish a report of audit under sections

10AA, 44AB, 44DA, 50B, 80‐IA, 80‐IB, 80‐IC, 80‐ID, 80JJAA, 80LA(1), 80LA(1A) 92E, 115JB or

115JC he shall file the report electronically on or before one month of the due date

specified for filing of the return of income.

4. Filling out the ITR‐V –Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 3(iv), the

assessee should print out Form ITR‐V‐Income Tax Return Verification Form. ITR‐V‐Income

Tax Return Verification Form, duly signed by the assessee, has to be sent by ordinary post

or speed post only to Centralized Processing Centre, Income Tax Department, Bengaluru–

560500 (Karnataka).

Instructions to Form ITR-6 (A.Y. 2021-22)

 

Instructions for filling out FORM ITR‐6

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐6 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of

any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only i.e., it relates to

income earned in Financial Year 2020‐21.

2. Who is eligible to use this Return Form?

This Return Form can be used by a company as per section 2(17) of the Income Tax

Act, This form is filed by company other than a company which is required to file return in

Form ITR‐7.As per section 2(17) of Income Tax Act, company means: ‐

(i) Indian Company (Domestic Company)

(ii) Body corporate incorporated by or under the laws of country outside India

(iii) Any institution, association or body, whether incorporated or not &

whether Indian or Non‐Indian which is declared by general or special order

of the board to be company,etc.

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on

the e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified by way of digital signature

only.

Instructions to Form ITR-7 (A.Y. 2021-22)

 

Instructions for filling out Form ITR‐7

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐7fortheAssessmentYear2021‐22relatingtotheFinancialYear2020‐21.Incase of any

doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules,1962.

1. Assessment Year for which this Return Form isapplicable

ThisReturnFormisapplicableforassessmentyear2021‐22onlyi.e.,itrelatesto income

earned in Financial Year2020‐21.

2. Who is eligible to use this ReturnForm?

ThisReturnFormcanbeusedbypersonsincludingcompanieswhoarerequired

tofurnishreturnundersection139(4A)orsection139(4B)orsection139(4C)orsection 139(4D).

The category of persons whose income is unconditionally exempt under various

clausesofsection10,andwhoarenotmandatorilyrequiredtofurnishtheirreturnofincome

undertheprovisionsofsection139,mayusethisformforfilingreturn.Anindicativelistof such

persons is given below:‐

Sl.no Category of persons Exempt under section

1. Local authority Section 10(20)
2. Regimental Fund or Non‐public Fund established by the Armed forces of the Union Section 10(23AA).

3 .Fund, by whatever name called, set up by the Life insurance Corporation (LIC) of India on or after 1st August, 1996, or by any other insurer Section 10(23AAB)

4. Authority (whether known as the Khadi and Village Industries Board or by any other name) Section 10(23BB)

5 .Body or Authority Section 10(23BBA)

6. SAARC Fund for Regional Colombo Declaration Projects set up by Section 10(23BBC)
7. lnsurance Regulatory and DevelopmentAuthority (IRDA) Section 10(23BBE)

8 Central Electricity Regulatory Commission Section 10(23BBG)

9 Prasar Bharati Section 10(23BBH)

10 Prime Minister’s National Relief Fund Section 10(23C)(i)

11 Prime Minister’s Fund (Promotion of Folk Art) Section 10(23C)(ii)

12 Prime Minister’s Aid to Students Fund Section 10(23C)(iii)

13 National Foundation for Communal Harmony Section 10(23C)(iiia)

14 Swachh Bharat Kosh Section 10(23C)(iiiaa)

15 Clean Ganga Fund Section 10(23C)(iiiaaa) Instructions to Form ITR-7 (A.Y. 2021-22)

16 Provident fund to which the Provident Funds Act,1925 applies Section 10(25)(i)

17 Recognized Provident Fund Section 10(25)(ii)

18 Approved Superannuation Funds Section 10(25)(iii)

19 Approved Gratuity Fund Section 10(25)(iv)

20 Other funds referred to in sub‐clause (v) of section10(25) Section 10(25)(v)

21 Employees’ State Insurance Fund Section 10(25A)

22 Agricultural Produce Marketing Committee Section 10(26AAB)

23 Corporation, body, institution or association established for promoting interests of members of

Scheduled Castes or Scheduled Tribes or backward Classes Section 10(26B)

24 Corporation established for promoting interests of members of a minority community

Section 10(26BB).

25 Corporation established for welfare and economic upliftment of ex‐servicemen Section 10(26BBB).

26 New Pension System (NPS) Trust Section 10(44).

3. Manner of filing this ReturnForm

ThisReturnFormcanbefiledwiththeIncome‐taxDepartmentelectronicallyonthe efiling

web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following

manner–

(i) digitally signing the verification part,or

(ii) authenticating by way of electronic verification code (EVC),or

(iii) AadhaarOTP

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification

Form by post to CPC at the following address–

Centralized Processing Centre,Income Tax Department,

Bengaluru— 560500,Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within

120 days from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to

the assessee on e‐mail ID registered in the e‐Filing account.

However, a political party shall compulsorily furnish the return in the manner

mentioned at (i) above. In case an assessee is required to furnish a report of audit under sections

10(23C)(iv),10(23C)(v),10(23C)(vi),10(23C)(via),12A(1)(b),92E he shall file such report

electronically on or before the date of filing the return of income.Instructions to Form ITR-1 (A.Y. 2021-22)

Instructions for filling ITR‐1 SAHAJ A.Y. 2021‐22

General Instructions

These instructions are guidelines to help the taxpayers for filling the particulars in Incometax

Return Form‐1 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21.

In case of any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the

Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year 2021‐22 only, i.e., it relates to income earned during the Financial Year 2020‐21.

2. Who is eligible to use this Return Form

This Return Form is to be used by an individual who is a resident other than not ordinarily resident, whose total income for the Assessment Year 2021‐22 does not exceed Rs. 50 lakh and who has income under the following heads:‐

(a) Income from Salary/ Pension; or

(b) Income from One House Property; or

(c) Interest income and/ or family pension taxable under Other Sources.

NOTE:

Further, in a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used only if the income being clubbed falls into the above income categories.

3. Who is not eligible to use this Return Form?
4. This Return Form should not be used by an individual who –

(a) is a Director in a company;

(b) has held any unlisted equity shares at any time during the previous year;

(c) has any asset (including financial interest in any entity) located outside India;

(d) has signing authority in any account located outside India; or

(e) has income from any source outside India.

(f) has deferred tax on ESOP received from employer being an eligible start‐up.

(g) has withdrawn cash and TDS has been deducted u/s 194N on such withdrawal.

1. This return form also cannot be used by an individual who has any income of the following nature during the previous year:‐Instructions to Form ITR-1 (A.Y. 2021-22)

(a) Profits and gains from business and professions;

(b) Capital gains;

(c) Income from more than one house property;

(d) Income under the head other sources which is of following nature:‐

(i) winnings from lottery;

(ii) activity of owning and maintaining race horses;

(iii) income taxable at special rates under section 115BBDA or section 115BBE;

(e) Income to be apportioned in accordance with provisions of section 5A; or

(f) Agricultural income in excess of ₹5,000.

1. Further, this return form also cannot be used by an individual who has any claims of loss/deductions/relief/tax credit etc. of the following nature:‐

(a) any brought forward loss or loss to be carried forward under the head ‘Income from house property’;

(b) loss under the head ‘Income from other sources’;

(c) any claim of relief under section 90 and/or section 91;

(d) any claim of deduction under section 57, other than deduction under clause

(iia) thereof (relating to family pension); or

(e) any claim of credit of tax deducted at source in the hands of any other person.

4. Annexure‐less Return Form

No document (including TDS certificate) should be attached to this Return Form. All such documents enclosed with this Return Form will be detached and returned to the person filing the return.

5. Key changes (as compared to ITR for AY 2020‐21)

(a) Option to avail benefit of new tax regime u/s 115BAC is provided in ITR‐1. Option should be availed within due date mentioned as per section 139(1).

(b) ITR 1 cannot be filed by the assessee who is having TDS u/s 194N.

(c) Resident Individual having Income‐Tax deferred on ESOP is restricted to file ITR‐1

(d) Quarterly breakup of dividend income to be provided.

(e) Schedule DI is removed.

(f) Date of Donation made in cash has inserted to calculate eligible amount of donation u/s 80GGA

6. Manner of filing and Verification of this Return Form

This Return Form can be filed with the Income‐tax Department in any of the following ways:‐

Instructions to Form ITR-1 (A.Y. 2021-22)

1. electronically on the e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in) [www.incometax.gov.in from 7‐June‐ 2021] and verified in any one of the following manner –

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR‐V ‐ Income Tax Return

Verification Form by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V ‐ Income Tax Return Verification Form should reach within 120 days from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

1. in paper form, at the designated offices of Income‐tax Department, along with duly signed Form ITR‐V. This mode of furnishing return is permissible only in case of super senior citizens (i.e. an individual of the age of 80 years or

more at any time during the previous year).

7. Filling out the ITR V‐ Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 5A(iv) above, the assessee should print out Form ITRV‐ Income Tax Return Verification Form. ITRVIncome Tax Return Verification Form, duly signed by the assessee then has to be sent by ordinary post or speed post only to Central, Processing Centre, Income Tax Department, Bengaluru‐ 560500 (Karnataka).

Instructions to Form ITR-2 (AY 2021-22)

 

Instructions for filling out FORM ITR‐2

These instructions are guidelines for filling the particulars in Income‐tax Return Form‐2

for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of any doubt,

please refer to relevant provisions of the Income‐tax Act, 1961 and the Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only, i.e., it relates to income

earned in Financial Year2020‐21.

2. Who is eligible to use this Return Form?

This Return Form is to be used by an individual or a Hindu Undivided Family (HUF) who is

not eligible to file Form ITR‐1 (Sahaj) and who is not having any income under the head “Profits

or gains of business or profession”.

3. Who is not eligible to use this Return Form?

This Return Form should not be used by an individual whose total income for the

Assessment Year 2021‐22includes Income under the head “Profits or Gains of Business or

Profession”.

4. Manner of filing and verification of this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the efiling

web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following manner –

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form by

post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V – Income Tax Return Verification Form should reach within 120 days from

the date of e‐filing the return.The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

Instructions to Form ITR-3 (A.Y 2021-22)

Instructions for filling out FORM ITR‐3

These instructions are guidelines for filling the particulars in Income‐tax Return Form‐

3 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of any

doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Income‐tax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only, i.e., it relates to income earned in Financial Year2020‐21.

2. Who is eligible to use this Return Form?

This Return Form is to be used by an individual or a Hindu Undivided Family who is having income under the head “profits or gains of business or profession” and who is not eligible to file Form ITR‐1 (Sahaj), ITR‐2 or ITR‐4 (Sugam).

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the efilingweb

portal of Income‐tax Department (www.incometaxindiaefiling.gov.in) [www.incometax.gov.in from 7‐June‐2021]and verified in any one of the following manners –(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form

by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within 120 days

from the date of e‐filing the return.The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to the assessee on e‐mail ID registered in the e‐filing account.

However, in a case where accounts are required to be audited u/s 44AB, it is

mandatory to verify the return electronically under digital signature.In case an assessee is required to furnish a report of audit under sections 10AA, 44AB,44DA, 50B, 80 ‐IA, 80‐IB, 80‐IC, 80‐ID, 80JJAA, 80LA, 92E, 115JB or 115JC, he shall file such report electronically one month before the due date of filingof return of income.

4. Filling out the ITR V‐Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 3(iv), the assessee

should print out Form ITR‐V‐Income Tax Return Verification Form. ITR‐V‐Income Tax Return

Verification Form, duly signed by the assessee, has to be sent by ordinary post or speed post

Instructions to Form ITR-3 (A.Y 2021-22) only to Centralized Processing Centre, Income Tax Department, Bengaluru–560500 (Karnataka).

Instructions to Form ITR-4 (A.Y. 2021-22)

Instructions for filling ITR‐4 SUGAM A.Y. 2021‐22

General Instructions

These instructions are guidelines to help the taxpayers for filling the particulars in Incometax

Return Form‐4 for the Assessment Year 2021‐22 relating to the Financial Year2020‐21.

In case of any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the

Income‐tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for Assessment Year 2021‐22 only, i.e., it relates to income

earned during the Financial Year 2020‐21.

2. Who is eligible to use this Return Form

This Return Form is to be used by an individual or HUF, who is resident other than not

ordinarily resident, or a Firm (other than LLP) which is a resident, whose total income for the

assessment year 2020‐21 does not exceed Rs.50 lakh and who has income under the

following heads:‐

(a) Income from business where such income is computed on presumptive basis under

Section 44AD (i.e. Gross Turnover upto Rs. 2 crore) or Section 44AE (income from

goods carriage upto ten vehicles); or

(b) Income from Profession where such income is computed on presumptive basis under

Section 44ADA (i.e. Gross receipt upto Rs. 50 lakh); or

(c) Income from Salary/ Pension; or

(d) Income from One House Property; or

(e) Interest income and / or income from family pension taxable under Other Sources.

Note 1: The income computed on presumptive basis under sections 44AD or 44AE or 44ADA

shall be presumed to have been computed after giving full effect to every loss, allowance,

depreciation or deduction under the Income‐tax Act. However, person having loss after

giving effect to proviso to sub‐section 3 of Section 44AE shall file ITR5

Note 2: Further, in a case where the income of another person like spouse, minor child, etc.

is to be clubbed with the income of the assessee, this Return Form can be used only if the

income being clubbed falls into the above income categories.

3. Who is not eligible to use this Return Form
4. This Return Form should not be used by a person who –

(a) is a Director in a company;

(b) has held any unlisted equity shares at any time during the previous year;

(c) has any asset (including financial interest in any entity) located outside India;

(d) has signing authority in any account located outside India; or

(e) has income from any source outside India.

(f) has deferred tax on ESOP received from employer being an eligible start‐up.

1. This return form also cannot be used by a person who has any income of the

following nature during the previous year:‐

(a) Profits and gains from business and professions which is not required to be

computed u/s 44AD, 44ADA or 44AE, such as income from speculative business,

agency business, commission or brokerage income etc.;

(b) Capital gains;

(c) Income from more than one house property;

(d) Income under the head other sources which is of following nature:‐

(i) winnings from lottery;

(ii) activity of owning and maintaining race horses;

(iii) income taxable at special rates under section 115BBE;

(e) Income to be apportioned in accordance with provisions of section 5A; or

(f) Agricultural income in excess of ₹5,000.

1. Further, this return form also cannot be used by a person who has any claims of

loss/deductions/relief/tax credit etc. of the following nature:‐

(a) any brought forward loss or loss to be carried forward under any head of income;

(b) loss under the head ‘Income from other sources’;

(c) any claim of relief under section 90, 90A or section 91;

(d) any claim of deduction under section 57, other than deduction under clause (iia)

thereof (relating to family pension); or

(e) any claim of credit of tax deducted at source in the hands of any other person

4. SUGAM form is not mandatory

Form ITR‐4 (Sugam) is a simplified return form to be used by an assessee, at his option, if he

is eligible to declare profits and gains from business and profession on presumptive basis

under section 44AD, 44ADA or 44AE. However, in case the assessee keeps and maintains all

books of accounts and other documents referred to in section 44AA, and also gets his

accounts audited and obtains an audit report as per section 44AB, filling up the Form ITR‐4

(Sugam) is not mandatory. In such a case, other regular return forms viz. ITR‐3 or ITR‐5, as

applicable, should be used and not this Form.

Instructions to Form ITR-5 (A.Y. 2021-22)

 

Instructions for filling out FORM ITR‐5

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐5 for the Assessment Year 2021‐22 relating to the Financial Year2020‐21. In case of

any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22 only, i.e., it relates to

income earned in Financial Year 2020‐21.

2. Who is eligible to use this Return Form?

This Form can be used by a person being a firm, Limited Liability Partnership (LLP),

Association of Persons (AOP), Body of Individuals (BOI), Artificial Juridical Person (AJP)

referred to in clause (vii) of section 2(31), local authority referred to in clause (vi) of

section 2(31), representative assessee referred to in section 160(1)(iii) or (iv),Primary

Agricultural Credit Society, Co‐operative Bank other than a primary agricultural credit

society or a primary co‐operative agricultural and rural development bank, Primary Cooperative

Agricultural and Rural Development bank, any other cooperative society, society

registered under Societies Registration Act, 1860 or under any other law of any State, trust

other than trusts eligible to file Form ITR‐7, estate of deceased person, estate of an

insolvent, business trust referred to in section 139(4E) , investments fund referred to in

section 139(4F) and Any other AOP /BOI.

However, a person who is required to file the return of income under section

139(4A) or 139(4B) or 139(4D)shall not use this form.

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on the

e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following manner

–

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii) Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification Form

by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within 120 days

from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be

sent to the assessee on e‐mail ID registered in the e‐filing account.

Instructions to Form ITR-5 (A.Y. 2021-22)

However, in a case where accounts are required to be audited u/s 44AB, it is

mandatory to verify the return electronically under digital signature.

In case an assessee who is required to furnish a report of audit under sections

10AA, 44AB, 44DA, 50B, 80‐IA, 80‐IB, 80‐IC, 80‐ID, 80JJAA, 80LA(1), 80LA(1A) 92E, 115JB or

115JC he shall file the report electronically on or before one month of the due date

specified for filing of the return of income.

4. Filling out the ITR‐V –Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 3(iv), the

assessee should print out Form ITR‐V‐Income Tax Return Verification Form. ITR‐V‐Income

Tax Return Verification Form, duly signed by the assessee, has to be sent by ordinary post

or speed post only to Centralized Processing Centre, Income Tax Department, Bengaluru–

560500 (Karnataka).

Instructions to Form ITR-6 (A.Y. 2021-22)

 

Instructions for filling out FORM ITR‐6

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐6 for the Assessment Year 2021‐22 relating to the Financial Year 2020‐21. In case of

any doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2021‐22only i.e., it relates to

income earned in Financial Year 2020‐21.

2. Who is eligible to use this Return Form?

This Return Form can be used by a company as per section 2(17) of the Income Tax

Act, This form is filed by company other than a company which is required to file return in

Form ITR‐7.As per section 2(17) of Income Tax Act, company means: ‐

(i) Indian Company (Domestic Company)

(ii) Body corporate incorporated by or under the laws of country outside India

(iii) Any institution, association or body, whether incorporated or not &

whether Indian or Non‐Indian which is declared by general or special order

of the board to be company,etc.

3. Manner of filing this Return Form

This Return Form can be filed with the Income‐tax Department electronically on

the e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified by way of digital signature

only.

Instructions to Form ITR-7 (A.Y. 2021-22)

 

Instructions for filling out Form ITR‐7

These instructions are guidelines for filling the particulars in Income‐tax Return

Form‐7fortheAssessmentYear2021‐22relatingtotheFinancialYear2020‐21.Incase of any

doubt, please refer to relevant provisions of the Income‐tax Act, 1961 and the Incometax

Rules,1962.

1. Assessment Year for which this Return Form isapplicable

ThisReturnFormisapplicableforassessmentyear2021‐22onlyi.e.,itrelatesto income

earned in Financial Year2020‐21.

2. Who is eligible to use this ReturnForm?

ThisReturnFormcanbeusedbypersonsincludingcompanieswhoarerequired

tofurnishreturnundersection139(4A)orsection139(4B)orsection139(4C)orsection 139(4D).

The category of persons whose income is unconditionally exempt under various

clausesofsection10,andwhoarenotmandatorilyrequiredtofurnishtheirreturnofincome

undertheprovisionsofsection139,mayusethisformforfilingreturn.Anindicativelistof such

persons is given below:‐

Sl.no Category of persons Exempt under section

1. Local authority Section 10(20)
2. Regimental Fund or Non‐public Fund established by the Armed forces of the Union Section 10(23AA).

3 .Fund, by whatever name called, set up by the Life insurance Corporation (LIC) of India on or after 1st August, 1996, or by any other insurer Section 10(23AAB)

4. Authority (whether known as the Khadi and Village Industries Board or by any other name) Section 10(23BB)

5 .Body or Authority Section 10(23BBA)

6. SAARC Fund for Regional Colombo Declaration Projects set up by Section 10(23BBC)
7. lnsurance Regulatory and DevelopmentAuthority (IRDA) Section 10(23BBE)

8 Central Electricity Regulatory Commission Section 10(23BBG)

9 Prasar Bharati Section 10(23BBH)

10 Prime Minister’s National Relief Fund Section 10(23C)(i)

11 Prime Minister’s Fund (Promotion of Folk Art) Section 10(23C)(ii)

12 Prime Minister’s Aid to Students Fund Section 10(23C)(iii)

13 National Foundation for Communal Harmony Section 10(23C)(iiia)

14 Swachh Bharat Kosh Section 10(23C)(iiiaa)

15 Clean Ganga Fund Section 10(23C)(iiiaaa) Instructions to Form ITR-7 (A.Y. 2021-22)

16 Provident fund to which the Provident Funds Act,1925 applies Section 10(25)(i)

17 Recognized Provident Fund Section 10(25)(ii)

18 Approved Superannuation Funds Section 10(25)(iii)

19 Approved Gratuity Fund Section 10(25)(iv)

20 Other funds referred to in sub‐clause (v) of section10(25) Section 10(25)(v)

21 Employees’ State Insurance Fund Section 10(25A)

22 Agricultural Produce Marketing Committee Section 10(26AAB)

23 Corporation, body, institution or association established for promoting interests of members of

Scheduled Castes or Scheduled Tribes or backward Classes Section 10(26B)

24 Corporation established for promoting interests of members of a minority community

Section 10(26BB).

25 Corporation established for welfare and economic upliftment of ex‐servicemen Section 10(26BBB).

26 New Pension System (NPS) Trust Section 10(44).

3. Manner of filing this ReturnForm

ThisReturnFormcanbefiledwiththeIncome‐taxDepartmentelectronicallyonthe efiling

web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in)

[www.incometax.gov.in from 7‐June‐2021] and verified in any one of the following

manner–

(i) digitally signing the verification part,or

(ii) authenticating by way of electronic verification code (EVC),or

(iii) AadhaarOTP

(iv) by sending duly signed paper Form ITR‐V – Income Tax Return Verification

Form by post to CPC at the following address–

Centralized Processing Centre,Income Tax Department,

Bengaluru— 560500,Karnataka”.

The Form ITR‐V‐Income Tax Return Verification Form should reach within

120 days from the date of e‐filing the return.

The confirmation of the receipt of ITR‐V at Centralized Processing Centre will be sent to

the assessee on e‐mail ID registered in the e‐Filing account.

However, a political party shall compulsorily furnish the return in the manner

mentioned at (i) above. In case an assessee is required to furnish a report of audit under sections

10(23C)(iv),10(23C)(v),10(23C)(vi),10(23C)(via),12A(1)(b),92E he shall file such report

electronically on or before the date of filing the return of income.

PAN Card – Permanent Account Number (PAN) in India

Permanent Account Number or PAN is a means of identifying various taxpayers in the country. PAN is a 10-digit unique identification alphanumeric number (containing both alphabets and numbers) assigned to Indians, mostly to those who pay tax.

The PAN system of identification is a computer-based system that assigns unique identification number to every Indian tax paying entity. Through this method, all tax-related information for a person is recorded against a single PAN number which acts as the primary key for storage of information. This is shared across the country and hence no two people on tax paying entities can have the same PAN.

When PAN is allotted to an entity, PAN Card too is given by the Income Tax Department. While PAN is a number, PAN Card is a physical card that has your PAN as well as name, date of birth (DoB), and photograph. Copies of this card can be submitted as proof of identity or DoB.Your PAN Card is valid for lifetime because it is unaffected by any change in address.

Deadline for Linking PAN Card and Aadhaar Card is 30 June 2021:

The government has extended the deadline to link Aadhaar with the PAN to 30 June 2021. Earlier, the deadline to link the Aadhaar and PAN was 31 March 2021. The main reason for the extension was the difficulties that are being faced because of the COVID-19 pandemic.

How to Apply for PAN Card

PAN Card applicationcan be made online on one of the following websites:

• NSDL
• UTIITSL

You can also apply offline at any of the district-level PAN agencies. You can apply for a new PAN as well as make correction or change information yourself. You can even request for a duplicate PAN Card or reprint the card if you lose the original.

For new PAN, Indian citizens and NRIs (including companies, NGOs, partnership firms, local bodies, trusts, etc.) need to fill Form 49A. Foreigners and foreign entities need to use Form 49AA. These forms, along with all the required PAN documents , should be submitted to the Income Tax PAN Services Unit.

Once you apply for a new or duplicate PAN, or request for corrections/changes, you can track the status of PAN application via the acknowledgement number provided.

As per the NSDL website, the entire process of printing and dispatching cards takes approximately 2 weeks or 14 days.

PAN Card Application Do’s and Don’ts

• Fill in all the details as per the identity and address proof documents you are submitting.
• Get your thumb impression attested by a Magistrate/Notary before submitting the form, to avoid disqualification.
• Write the complete address and provide accurate contact details in the form.
• Fill in the application form in capital letters.
• Don’t make corrections or over-write anywhere on the form.
• Do not use initials in the first name or last name columns.
• Do not apply for a new PAN card if your old PAN card is lost/stolen/defaced. Request for a duplicate PAN instead.

Why Is PAN Important? – Uses and Benefits of Having PAN Card

PAN Card is important for taxpayers as it is necessary for all financial transactions and is used to track the inflow and outflow of your money. It is important when paying income tax, receiving tax refunds, and receiving communication from the Income Tax Department.

The Indian Budget 2019 proposed that individuals who do not have a PAN can use their Aadhaar number to file returns and for any other purpose where PAN was earlier mandatory. This means that if you have not link pan with aadhar yet, or do not have a PAN but have an Aadhaar, you don’t have to either link PAN and Aadhaar, or apply for a new PAN. However, the rules about this are still in the process of creation/updation/approval.

That said, PAN continues to be necessary for a large number of monetary transactions. PAN Card also serves as a proof of identity. Given below are some of the uses and advantages of having a PAN.

Uses of PAN in Financial Transactions

• PAN needs to be quoted while paying direct taxes.
• Taxpayers need to input their PAN when paying income tax.
• While registering a business, PAN information needs to be furnished.
• A lot of financial transactions require PAN information. Some of these transactions are:
• Sale or purchase of property (immovable) which is valued at Rs.5 lakh or above
• Sale or purchase of a vehicle except a two-wheeler
• Payments made towards hotels and restaurants and which are above Rs.25,000
• Payments made in connection with travel requirements to other countries. The amount in this case if it exceeds Rs.25,000, then you need to quote your PAN
• Payments of more than Rs.50,000 towards bank deposits
• Purchase of bonds worth Rs.50,000 or more
• Purchase of shares worth Rs.50,000 or more
• Purchase of insurance policy worth Rs.50,000 or more
• Purchase of mutual fund schemes
• Payments made for more than Rs.5 lakh towards purchase of jewellery and bullion
• To remit money out of India
• Transfer of funds from NRE to NRO account

General Uses/Advantages of Having PAN

• Since PAN Card contains information such as Name, Age and photograph, it can be used throughout the country as a valid identity proof.
• PAN is the best possible way to keep track of your tax payment. Otherwise, you might be required to pay it multiples times since your tax payment cannot be verified.
• Since PAN is unique for every entity, its misuse is almost impossible for purposes of tax evasion or other devious means.
• PAN Card can be used to avail utility connections such as electricity, telephone, LPG, and internet.

Who Should Get PAN? – PAN Card Eligibility

Under section 139A of the Income Tax Act, the following taxpaying entities are required to have a Permanent Account Number:

• Any person who has paid tax or is liable to pay tax to the Income Tax Department. This will be decided based on the tax slabs.
• Any person who is carrying out a business or professional practice which earns him a yearly turnover of more than Rs.5 lakh in any year of assessment.
• Importers and exporters who are liable to pay any form of tax or duty charges as per the Income Tax Act or as per any prevalent law
• All kinds of trusts, charitable organisations, and associations.

All tax paying entities – minors, individuals, HUFs, partnerships, companies, body of individuals, trusts, and others – should apply for PAN.

Tracking PAN Transactions

The government recently unveiled a programme by which it can track transactions made through a PAN card for the purpose of calculating tax. Known as the Income Tax Business Application-Permanent Account Number or ITBAN-PAN, it will enable the Income Tax Department to track every transaction made where a particular PAN number was quoted.

• All financial transactions such as mergers, acquisitions, liquidation, and amalgamation of PAN as well as dissolution information where a particular PAN card was quoted can be traced through the software.
• All existing PAN information and the entire database of PAN information has also been moved to this software.

What happens if you don’t have PAN Card?

If your income falls in the taxable bracket, not having a PAN card would result in:

• Flat 30% tax on your earnings and wealth, as stipulated by the Income Tax Department of India. This rule applies to individuals, companies and all entities eligible for tax, including foreign nationals and firms registered outside India.
• Not being able to purchase a motor vehicle, buy immovable property worth over Rs. 10 lakh, or open a bank account, among other activities.
• Businesses unable to conduct a large chunk of their financial activities and procurement.

*Please note that these rules may change once Aadhaar and PAN become interchangeable.

New Design of PAN Cards

The Income Tax Department has prescribed a new format for PAN Cards issued after 1 January 2017. The changes made to the new PAN Card have been listed below:

• A Quick Response (QR) code has been printed onto the new PAN Card which will carry details of the card holder. This QR code can be used for verification of data.
• New sections for the name of the card holder, the card holder’s father’s name, and date of birth have been added.
• The location of the PAN and the signature of the card holder have been changed.

PAN Card Forms

In order to apply for a PAN card, an application form has to be filled out. There are two types of application forms – Form 49A and Form 49AA. Both the forms can be availed through both online and offline platforms.

• Form 49A: The Form 49A is used by Indian individuals or entities to apply for a PAN card. Students and minors can also apply for PAN using this form.
• Form 49AA: The Form 49AA is the application form for PAN which is used in the case of foreigners.

The forms have to duly filled up and sent in to the TIN-NSDL’s office.

The Cost of PAN Application

An individual can make an online application for his or her PAN card. This can be done through the NSDL website or the UTITSL portal. The cost of application for PAN can be summed as follows:

• For Indian communication address: Rs.93 (excluding GST)
• For foreign communication address: Rs.864 (excluding GST)

How to make Changes or corrections in PAN Card

Given below are the steps you will have to follow if you wish to make changes or correction to your Pan Card online:

• You can visit the NSDL website and under ‘Services’, click on PAN.
• Scroll down and under ‘Change/Correction in PAN Data’, click on ‘Apply’.
• Under ‘Application Type’, select ‘Changes/Correction in PAN Data’.
• Enter the other details, and click on Submit’.
• You will get a token number which you can use later for tracking purposes.
• Continue to the application form where you will have to state the changes or correction in PAN Card. Provide the new details and make a payment of Rs.93 and submit the form.
• You will have to send the required documents as proof via post to NSDL. The documents you will most likely have to submit will be proof of address, proof of identity, and the proof of document showing the change you wish to make in your PAN Card.
• Your application form will be processed and if the documents submitted by you are correct, those changes will be incorporated in your PAN Card.
• Once those changes are incorporated, the new PAN Card will be dispatched to your communication address which you will receive within 15 days.

How to apply for PAN Card Offline

Given below are the steps you will have to follow if you wish to apply for PAN Card offline

• Visit the official website of TIN-NSDL by clicking on the link https://www.tin-nsdl.com/.
• On the main page, under the “Downloads’ section, click on ‘PAN’. You will be directed to a new page.
• Click on ‘Form 49A’.
• The Form 49A application form will appear on your computer screen in the pdf format. Download the form and take a print out.
• Fill the form and make sure all the details entered by you are correct.
• Make sure you attach all the necessary documents including your passport size photograph.
• You will have to pay the registration fee which can be paid via demand draft in favor of ‘NSDL – PAN’ payable at Mumbai. You will have pay Rs.115.90.
• Enclose the application form and photocopies of your documents in an envelope. Make sure you mention ‘APPLICATION FOR PAN-N-Acknowledgement Number’ on the envelope and send it to the address

Income Tax PAN Services Unit, NSDL e-Governance Infrastructure Limited, 5th floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411016.

You will later receive an application number which you can use to track the status of your PAN Card application.

Documents Required to apply for a PAN Card

In order to apply for PAN Card, you will have to submit a host of documents including Form 49A or 49AA. Given below is the list of documents you will have to submit while applying for a PAN Card:

If you are an individual applicant

• Proof of identity such as Aadhaar, Voter ID, Driving License, etc.
• Proof of address such as utility bill, water bill, bank account statement, statement of your credit card, Passport, Driving License, Domicile certificate issued by the Government, certificate of marriage, matriculation certificate, etc.

If you belong to a Hindu Undivided Family (HUF)

• You will have to submit an affidavit issued by the Karta of the HUF. The affidavit must clearly mention the name, address, and every coparcener father’s name.
• If you belong to HUF and is individually applying for a PAN Card, then you will have to submit the proof of identity, proof of address, and date of birth proof.

For companies registered in India

• A copy of the Registration Certificate issued by the Registrar of Companies is to be submitted.

Firms and Limited Liability Partnerships registered or formed in India

• A copy of the Registration Certificate issued by the Registrar of Companies is to be submitted.
• A copy of the Partnership Deed is to be submitted.

For Trusts formed or registered in India

• You will have to submit a copy of the Registration Certificate Number issued by a Charity Commissioner.

For Association of Persons

• Agreement Copy or Registration Number Certificate issued by the Registrar of Co-operative Society or Charity Commissioner, or any document issued by the Central or State Government which clearly mentions your address and identity.

Applicants who are not Citizens of India

• Proof of identity such as a Copy of PIO issued by the Government of India, Copy of OCI issued by the Government of India, Passport Copy, etc.
• Proof of Address can be bank statement of the residential country, NRE Bank statement, Copy of VISA granted by an Indian company, registration certificate issued by FRO, etc.

How to apply for a Duplicate PAN Card if you have Lost your Original PAN Card

You will have to follow the steps given below to order for a duplicate PAN Card if you have lost your Original PAN Card:

• Visit the TIN-NSDL or UTIITSL website to apply for a duplicate PAN Card.
• If you are a citizen of India then you will have to submit Form 49A, otherwise Form 49AA if you are a foreigner.
• Complete the payment required to apply for a duplicate PAN Card. You can also make the payment via demand draft.
• Take the printout of the form and send to the address given below:

Income Tax PAN Services Unit, NSDL e-Governance Infrastructure Limited, 5th Floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411 016.

• It will take up to 45 days for you to receive your duplicate PAN Card.

PAN Card Enquiry/ PAN Card Tracking/ PAN Card Online Status Check

• The status of your PAN Card can be checked online after you have submitted the application for it.
• The application status will show you whether the card has been issued or is in transit.
• You can check the status of your PAN Card application on either TIN-NSDL or UTIITSL website.
• You can figure out the status of your PAN Card application with your name and date of birth entered on the website.

Who Issues PAN Card?

PAN Card is issued by the Income Tax Department with help from authorised district-level PAN agencies, UTI ITSL (UTI Infrastructure Technology and Services Limited), and NSDL (National Securities Depository Limited). There are several TIN-Facilitation Centres and PAN centres across the country, run by NSDL that help citizens get their PAN Card.

The process of issuing of PAN works on the PPP (Public Private Partnership) model. This is done to maintain economy, efficiency, and effectiveness of managing, processing, and issuing PAN applications.

How is PAN Allotted?

• Once you submit your PAN application with the filled-up form and supporting documents, the PAN Centre verifies it against the original documents.
• For online process, you need to submit the form online and then send self-attested photocopies of the documents to NSDL, Pune.
• Assessing Officers assess the application details. Your details will be cross-verified against the details of existing PAN Card holders in the central database.
• In case there is no record of a previous PAN allotted to you, then the request is accepted and processed. A PAN is allotted to you as per your taxpayer classification.

What do the Alphabets and Numbers on your PAN Card Mean?

Your Permanent Account Number is not a series of random numbers and letters. The structure of PAN is actually quite interesting. Here’s what each component of PAN means:

• First Three Characters: These are a sequence of alphabets from AAA to ZZZ.
• Fourth Character:The fourth character signifies the type of taxpayer that you are.
• A – Association of Persons (AOP)
• B – Body of Individuals (BOI)
• C – Company
• F – Firm/Limited Liability Partnership
• G – Government Agency
• H – HUF (Hindu Undivided Family)
• L – Local Authority
• J – Artificial Judicial Person
• P – Individual
• T – Trust
• Fifth Character: The fifth character in PAN is the first letter of your surname. So, if a person is named ‘Rajesh Khanna’, the fifth character of his PAN will be ‘K’.
• Sixth to Ninth Characters: This is from a sequence of numbers between 0001 and 9999.
• Last Characters: This is an alphabet check letter.

Types of PAN Cards

PAN cards are issued to different tax-paying entities. Based on that, the types of PAN are:

1. PAN Card for Indian Individuals
2. PAN Card for Indian Companies
3. PAN for Foreign Citizens
4. PAN for Foreign Companies

PAN Cards issued to individuals have the person’s photograph, name, father’s name, date of birth, signature, an authenticity hologram, QR Code, date of issue of the PAN, and the Permanent Account Number. PAN Cards issued to companies have the name of the company, its date of registration, the PAN number, hologram, QR Code, and date of issue of PAN. It will not have a photograph or signature.

History of PAN in India

Before the concept of PAN was introduced, there was a GIR number assigned to taxpayers. This was basically a manual system and was unique only within a ward or under a particular assessing officer. However, the number was not unique at the country level. Since GIR unique not unique, there could be higher chances of miscalculation and errors, or cases of mistaken identity during tax assessment.

The GIR number was allotted by the Assessing Officer to a tax payer and it included the Assessing Officer’s information as well.

In the year 1972, the concept of PAN was rolled out by the Indian government and was made statutory under section 139A of the Income Tax Act, 1961. Initially a voluntary process, PAN was made mandatory for all tax paying individuals in 1976.

The initial PAN number allotments were made manually, and to avoid duplication, each ward/circle received a certain set of numbers. This series was abandoned in the year 1995.

Structure of PAN Card

As per the guidelines of Know Your Customer or KYC, the details furnished on a PAN card are as follows:

1) Name of the cardholder

2) Father’s name of the cardholder

3) Date of Birth of the cardholder

4) 10-character alphanumeric Permanent Account Number or PAN

5) Signature of the cardholder

6) Photograph of the cardholder

7) The PAN card also comes with the logo and hologram of the Government of India along with a tag of the Income Tax Department (ITD).

Understanding the Permanent Account Number (PAN)

As mentioned above, the PAN is a combination of 10 characters. This combination can be explained as follows:

• The first 3 characters are alphabetic and can be any combination from the English alphabet.
• The fourth character is also an alphabet which denotes the category of the taxpayer. The categories are as follows:
• A – Association of Persons
• B – Body of Individuals
• C – Company
• F – Firms
• G – Government
• H – Hindu Undivided Family
• L – Local Authority
• J – Artificial Judicial Person
• P – Individual
• T – Association of Persons for a Trust
• The fifth character is also an alphabet and it denotes the first character of the cardholder’s surname.
• The next four characters are numeric and are random in nature.
• The last character is an alphabet again.

Old PAN Series

In spite of these changes, the first avatar of the PAN card met with some difficulties, as mentioned below:

• There was no database to maintain records of the PAN number allotted, with very limited information being recorded.
• The data that was stored for PAN holders was neither structured well nor did it capture detailed information except a few primary details like name, address, etc.
• There was no centralised authority who issued the PAN cards, resulting in the possibility that different centres could allot the same number to different individuals in the country.
• The PAN number was not a permanent one as the number changed depending on the holder’s address.

New PAN Series

In 1995, under an amended section 139A of the Income Tax Act, the new series of PAN was rolled out by the Income Tax Department. The new PAN series facilitated the following points which were earlier not included in the old series of PAN:

• Linking of all tax-related information, current as well as past, to a single identification number.
• Easy retrieval of information from the central database. With the launch of the new PAN series, the segregation and recording of data was done more effectively.
• Matching all financial information mapped against a single PAN, so that all loan details, credit and debit details as well as investment details could be tracked and thereby help prevent tax evasion.

Concepts Similar to PAN Card

The concept of PAN, or a unique number assigned to every tax paying entity, is not a new concept. In fact, there are a number of similar such utilities that are used for tax purposes.

TAN (Tax Deduction and Collection Account Number) – This is a unique 10-digit number that is issued to individuals and entities who have to collect or deduct tax on payments made as part of tax Deducted at Source (TDS) under the Income Tax Act. TAN has to be quoted when applying for TDS or Tax Collected at Source (TCS) challans made to disburse the refund as well as on certificates. Failure to quote the TAN would result in a fine of Rs. 10, 000.

TIN (Taxpayer Identification Number) – TIN number is a unique 11-digit number that is used to identify dealers who are registered under Value Added Tax. Allotted by individual states, it is compulsory for all manufacturers, traders and dealers to register for a TIN number. This number is to be quoted when generating invoices, orders or quotations by both the issuing as well as the receiving company. It is also used to identify assesses under the Income tax Act of 1961.

Permanent Account Number (PAN) for e-KYC

You can use your PAN for e-KYC. e-KYC is a major requirement which is asked for by most service providers and it offers a number of benefits. Some of the benefits of the PAN e-KYC can be summed up as follows:

1) Quick processing: With the help of PAN e-KYC, you can share information with a service provider within a few minutes through dedicated and secured channels. This helps in making the processing quicker.

2) Hassle-free: As it is a paperless process, the PAN e-KYC enable hassle-free management of documents and information.

3) Authorisation: The data which is shared through PAN e-KYC is authentic data. This data is legal and nationally acceptable for the parties who are involved in the transaction.

4) Secured data: The data transferred between the cardholder and the service provider cannot be tampered as they are transferred through secure channels only. In addition to that, the data cannot be used without the consent of both the parties who are involved in this process.

However, it is mandatory to link your Aadhaar and your PAN for the purpose of e-KYC and verification which helps you avail the services and benefits from different service providers.

FAQ’s on PAN Card

1. Where do I get the PAN application form?

The PAN application form is available at any NSDL TIN Facilitation Centre (TIN-FC) or PAN Centre. Certain stationery vendors also provide the form to applicants. Alternatively, you can download the form from the NSDL-TIN website: https://www.tin-nsdl.com/downloads/pan/downloads-pan.html

2. To procure a PAN Card, can I write an application on plain paper?

No, it is not possible to apply for PAN Card through a handwritten application. The application is only accepted in the format notified by the Central Board of Direct Taxes. The forms pertaining to the same are:

For Indian citizens, Form 49A

For foreign citizens, Form 49AA

3. How should I fill the PAN application form?

The application form for PAN Card should be filled legibly in English. You should use capital letters and black ink (preferably) to update details. Make sure that you read all instructions carefully before filling up the form.

4. Is it necessary to include father’s name in the application form for a female who is married/widow/divorced?

All female applicants should include only their father’s name in the PAN application form, irrespective of their marital status. The form does not need to be updated with the husband’s name.

5. Is it necessary to furnish 2 photos for the application?

Yes, if you are an individual applicant, you should affix 2 recent colour photos with white background in the form. The size of the photos should be 3.5 cm x 2.5 cm. The photographs should not be clipped or stapled to the form. The applicant is required to sign across the photograph such that a part of the sign is on the photo and the rest is on the form. The image clarity on the PAN Card will depend on the clarity and quality of the photograph that you affix on the application form.

6. Should I mention my email ID or telephone number on the form?

It is mandated for all applicants to provide either their email ID or telephone number in the PAN application form, so that they can be contacted in the event of a discrepancy. It is also useful when the applicant receives the PAN through email.

If the landline number of the applicant is provided, the country code and STD code should be mentioned. If the mobile number is given, the country code should be stated.

If the email ID of the applicant is furnished, the PAN will be sent to him/her through email.

7. What is the application process for individuals who do not know how to sign?

In such a scenario, the left hand thumb impression of the applicant can be provided at the place meant for the signature in the PAN application form. This should further be attested by a Notary Public, a Gazetted officer, or a Magistrate with an official stamp and seal.

8. Are there any charges that I would have to pay for the PAN Card application form?

No, the form is available free of any charges.

9. When I submit Form 49A for PAN Card, what are the charges that I have to bear?

If your address is within India, then the PAN Card processing fee is Rs.110, i.e., Rs.93 (application fee) + 18% GST.

If your address is outside India, the PAN Card processing fee is Rs.1,020, i.e., Rs.93 (application fee) + Rs.771 (dispatch charges) + 18% GST.

10. Where should the PAN Card application form be submitted?

The PAN Card application form, once duly filled in and self-attested, can be submitted along with all relevant documents to any one of the PAN Centres or TIN-FCs that are managed by NSDL e-Gov.

If you have submitted a PAN Card application online, you should take a printout of the application form, sign it and affix a recent photograph. Then you should send this form along with supporting documentation to the address below:

Income Tax PAN Services Unit

(Managed by NSDL e-Governance Infrastructure Limited)

5th Floor, Mantri Sterling, Plot No. 341,

Survey No. 997/8, Model Colony,

Near Deep Bungalow Chowk,

Pune – 411 016

11. Will I get an acknowledgement when I submit my PAN application form at a TIN-FC?

Yes, you will receive an acknowledgement that contains a unique 15-digit number.

12. How can I change the photograph on my PAN Card?

If the photo on your PAN Card is unclear, then you can get the PAN Card replaced with a photograph of better quality and clarity. This facility is available as part of ‘Correction of PAN Card’ requests. This request is similar to that for name change and change in date of birth. You can visit the website, https://tin.tin.nsdl.com/pan/ and fill up the ‘PAN card change request form’. The relevant documents should be sent to the address mentioned in the form.

Form 49AForm 49AARequest for Pan Card

What is TAN?

In India, the Income Tax department of the Central Government issues a 10-digit alphanumeric number to all persons who bear the responsibility of collecting tax at source (TCS) or deducting tax at source (TDS). This number is unique and is known as the TAN. Under Section 203A of the IT Act of 1961, the TAN number has to be quoted on all TDS returns filed.

 

Relevance of this Number

It is imperative that you know your TAN no. Without it, you are certain to face a series of difficulties while filing your tax returns.  

Following are some reasons why holding a Tax Deduction and Collection Account Number is necessary. Note that all these provisions are clauses and conditions under Section 203A of the IT Act, 1961. 

• You cannot file TCS or TDS statements if you do not have a TAN.
• This number is required when you seek challansfor TDS or TCS payments; without it, you cannot procure these documents.
• Unless you can quote your TAN number, you will not be able to submit either TDS or TCS certificates. This may result in problems in the IT documentation process and plenty of persisting issues later. 
• Lastly, without the Tax Deduction and Collection Account Number, it is impossible to collect or submit a wide variety of IT-related forms.

Here, it is crucial to note that there is an important exception when it comes to obtaining and quoting the TAN. The number is not mandatory for any individual who deducts tax under Section 194-1A of the IT Act of 1961. 

This section applies to taxation/s for sales consideration of fixed assets like a plot of land or a building.

Obtain and Know Your TAN

You can choose between either online or offline methods to apply for and obtain a TAN. Most applications nowadays are routed through an online channel. The application process has been made very efficient due to online single-window services.A deductor applying for a TAN number can do so by logging on to the official NSDL-TIN website. 

The process to be followed is mentioned here –

1. Upon clicking on the requisite link, a ‘Register Yourself’ page will show up. Here, all necessary information must be uploaded. All details must be uploaded correctly and without any mistakes. 
2. Once this information is successfully uploaded, an acknowledgement page will appear. This page has several essential sections that must be preserved until a TAN is successfully allotted. 

            III.  This acknowledgement page will have details like – 

•  A 14-digit unique acknowledgement number.
• All your contact and payment details.
• Name and status of the applicant.
• A sizeable blank space for your signature.

            III.  Please take a print-out of this acknowledgement page. Until you receive your TAN, you must preserve it carefully.

1. The applicant must sign within the space provided, and ensure that it does not spill-over into other areas.
2. Provisions for thumb imprints are also available. However, it should be verified and attested by competent authorities, including Gazetted officers and Magistrates, among others.

Payment for Online TAN Application

The total amount the applicant has to pay for online TAN allotment is Rs. 55 plus 18% GST. 

Prior to GST implementation, individual states would levy their respective service charges. Now, this amount is the same across India. 

The payment can be completed in multiple ways including –

1. Cheque payment.
2. Demand Drafts.

 Electronic payments, including Net-Banking and online transfer. 

 Offline Method to Apply for and Know Your TAN

The offline method still exists for those who are not well-versed with online procedures. Applicants must obtain a copy of Form 49B and complete all the details required before submitting it to their nearest TIN-FC centre.

How to Obtain Form 49B?

One of the problems which a lot of applicants face is scant information on the availability of this Form. Please note that it can be procured in multiple ways –

1. It can be downloaded for free from the IT department’s official website.
2. The Form may also be freely obtained at any TIN-FC centre. 

      III.  Lastly, any legible photocopy of this Form is also accepted at NSDL centres.

Once you have deposited this Form with all details mentioned, you can know your TAN no. as soon as the request is processed. Note that you do not have to submit any documents when applying offline.

How to Search TAN?

Individuals who have misplaced their TAN number can easily check all the TAN details online following these simple steps:

• Log on to the IT Department’s official website and click on ‘Know your TAN.’
• A new page with the option ‘TAN search’ will appear. Select ‘Name’.
• Select ‘Category of Deductor’carefully.
• Next, select your ‘State’ (for jurisdictional purposes), put in your ‘Name’ and registered mobile number.
•  Click on the ‘Continue’ tab.
• An OTP will be sent to your registered mobile number. Insert it in the appropriate column on the next page.
• Now, click on ‘Validate’ to complete the process. 

The TAN details will be displayed on the next page.

Comparing TAN and PAN

While they are issued by the same authority- the Income Tax Department of India– there are several points where these two differ. Here is a brief explanation on TAN vs PAN.

Comparison Parameters	PAN	TAN
Issued by	The IT Department	-do-
Identifying code	10-digit alphanumeric code	-do-
Primary purpose	Acts as an all-in-one code or permit for every financial transaction.	Helps make TDS processes easier.
Required by	Every taxpayer	All individuals and firms having to pay tax at source.
Governing laws	Section 139 of the IT ACT (1961)	Section 203A of the same Act
Penalties and fines associated	Rs. 10,000 if an individual/firm fails to furnish PAN	-do-
Necessary forms to be filled up	1. For Indian citizens-Form 49A 2. For foreigners- Form 49AA	Form 49B is the sole document needed
Maximum number of units that can be held	One	One
Documents required for application	1. Valid and current ID proof with photograph 2. Proof of age (i.e. DOB) 3. Copies of photographs (reqd. only if the applicant is an individual)	1. No documents needed for offline TAN no application 2. In online instances, a signed acknowledgement is enough.
Application costs	1. Rs. 93 plus GST for Indians. 2. Rs. 864 plus GST for foreigners.	Rs. 55 plus GST.

 

TAN Number Rectification and Other Issues

For all problems pertaining to TAN, including instances where one wishes to cancel the number, an individual can visit NSDL’s official website and make the necessary changes. 

Please note that the Government of India has been planning a makeover of this prevailing system for applying for and receiving a TAN number. Already, the CBDT and the Ministry of Corporate Affairs (MCA) have issued orders which does away with filing both TAN and PAN for organisations.Instead, a single form, called ‘SPICe’ form or Form INC-32 will cover the basics. These are plans to encourage the ‘Ease of Doing Business’ in the country and are expected to help bolster the growth of businesses in the future.

 Tax Collected at Source ( TCS ):

Tax collected at source (TCS) is the tax payable by a seller which he collects from the buyer at the time of sale. Section 206C of the Income-tax act governs the goods on which the seller has to collect tax from the purchasers.

Goods covered under TCS provisions and rates applicable to them:

When the below-mentioned goods are utilized for the purpose of manufacturing, processing, or producing things, the taxes are not payable. If the same goods are utilized for trading purposes then tax is payable. The tax payable is collected by the seller at the point of sale. The rate of TCS is different for goods specified under different categories :

Type of Goods	Rate
Liquor of alcoholic nature, made for consumption by humans	1%
Timber wood under a forest leased	2.50%
Tendu leaves	5%
Timber wood by any other mode than forest leased	2.50%
A forest produce other than Tendu leaves and timber	2.50%
Scrap	1%
Minerals like lignite, coal and iron ore	1%
Bullion that exceeds over Rs. 2 lakhs/ Jewellery that exceeds over Rs. 5 lakhs	1%
Purchase of Motor vehicle exceeding Rs. 10 Lakhs	1%
Parking lot, Toll Plaza and Mining and Quarrying	2%

Classification of sellers and Buyers for TCS:

1. There are some specific people or organizations who have been classified as sellers for tax collected at source.No other seller of goods can collect tax at source from the buyers apart from the following list :

• Central Government
• State Government
• Local Authority
• Statutory Corporation or Authority
• Company registered under the Companies Act
• Partnership firms
• Co-operative Society
• Any person or HUF who is subjected to an audit of accounts under the Income-tax act for a particular financial year.

2. A buyer is a person who obtains goods of specified nature in any sale or right to receive any such goods, by way of auction, tender or any other mode. However, the below buyers are exempted from collection of tax at source.

• Public sector companies
• Central Government
• State Government
• Embassy of High commission
• Consulate and other Trade Representation of a Foreign Nation Clubs such as sports clubs and social clubs

         TCS PAYMENTS AND RETURN:

• All sums collected by an office of the Government should bedeposited on the same day of collection.
• The seller deposits the TCS amount in Challan 281  within 7 days from the last day of the month in which the tax was collected.
• If the tax collector responsible for collecting the tax and depositing the same to the government does not collect the tax or after collecting doesn’t pay it to the government as per above due dates, then he will be liable to pay interest of 1% per month or a part of the month.
• Every tax collector has to submit quarterly TCS return i.e in FORM 27EQ in respect of the tax collected by him in a particular quarter. The interest on delay in payment of TCS to the government should be paid before filing of the return.

Certificate of TCS:  

1.When a tax collector files his quarterly TCS return i.e  Form 27EQ, he has to provide a TCS certificate to the purchaser of the goods.

2. Form 27D is the certificate issued for TCS returns filed. This certificate contains the following details:

• Name of the Seller and Buyer
• TAN of the seller i.e who is filing the TCS return quarterly
• PAN of both seller and buyer
• Total tax collected by the seller
• Date of collection
• The rate of Tax applied

2. This certificate has to be issued within 15 days from the date of filing TCS quarterly returns. The due dates are:

 

Quarter Ending	Date for generating Form 27D
For the quarter ending on 30th June	30th July
For the quarter ending on 30th September	30th October
For the quarter ending on 31st December	30th January
For the quarter ending on 31st March	30th May

TCS EXEMPTIONS:

Tax collection at source is exempted in the following cases:

• When the eligible goods are used for personal consumption
• The purchaser buys the goods for manufacturing, processing or production and not for the purpose of trading those goods.

TCS UNDER GST

• Any dealer or traders selling goods online would get the payment from the online platform after deducting an amount tax @ 1 % under IGST Act. (0.5% in CGST & 0.5% in SGST)
• The tax would have to be deposited to the government by 10th of the next month.
• All the dealers/traders are required to get registered under GST compulsorily.

Submission of 24G:

In the case of an office of the Government, where tax has been paid to the credit of Central Government without the production of a challan associated with the deposit of the tax in a bank, below are the changes to the rules, Form 24G has to be submitted:

 Rules where TDS is deposited without challan (changes to Rule 30):

• If TDS has been deposited without a challan, the person to whom TDS has been reported for depositing to the government – such a person has to submit a statement in Form 24G to the agency authorised by the Principal Director of income tax (systems). [Rule 30(4)]
• Such Form 24G must be submitted issued within 15 days from the end of the relevant month. For the month of March, the form should be submitted by 30 April 2019
• Form 24G must be submitted (a) electronically under digital signature (b) electronically along with verification in Form 27A (c) or verified through an electronic process as prescribed
• A person referred to in bullet 1 shall inform the Book Identification number generated to each of the deductors for whom the sum deducted has been deposited.
• The Principal Director General of Income Tax (Systems) shall specify the procedure for furnishing and verification of statement Form 24G.

Rules where TCS under section 206C is deposited without challan (changes to Rule 37CA):

• If TCS has been deposited without a challan, the person to whom the collector has reported the TCS for depositing to the government – such a person will submit Form 24G to the agency authorised by the Principal Director of income tax (systems).
• Such Form 24G must be submitted within 15 days from the end of the relevant month.
• If Form 24G pertains to the month of March, it must be submitted on or before 30th April.d. Form 24G must be issued :
• electronically under digital signature
• electronically along with verification in Form 27A or
• verified through an electronic process as prescribed
• A person referred to in bullet 1 shall inform the Book Identification number generated to each of the deductors for whom the sum deducted has been deposited.
• The Principal Director General of Income Tax (Systems) shall specify the procedure for furnishing and verification of statement Form 24G.

 

TDS Meaning and TDS Full Form:

TDS full form is Tax Deducted at Source. Under this mechanism, if a person (deductor) is liable to make payment to any other person (deductee) will deduct tax at source and transfer the balance to the deductee. The TDS amount deducted will be remitted to the Central Government.

Who is  Liable to Deduct Tax at Source (TDS):

TAN or Tax Deduction and Collection Account Number is a 10 digit alpha numeric number required to be obtained by all persons Who are  Liable to Deduct Tax at Source (TDS) or collecting tax. It is compulsory to quote TAN in TDS/TCS return (including any e-TDS/TCS return), any TDS/TCS payment challan and TDS/TCS certificates.

TDS is treated as pre-paid taxes as it is paid in advance to the government. It is the duty of the person who paid to someone for his service, goods etc. These payments are specified by the act like salary payment, interest on securities, contract payment, dividends etc. Who deduct TDS of payee is called deductor and whose tax is deducted called deductee. The following persons are liable to deduct TDS and deposit to government on behalf of deductee.

Income Tax Act require specified persons to deduct tax on particular types of payments being made by them. The list of such persons requiring to make TDS is contained in TDS provision listed here.

TDS Return and the Associated Forms :

TDS return is a statement issued after successful payment of the taxes, containing all the transactions mentioned towards TDS deduction made during a quarter. It is issued by the payer, submitted to the Income Tax Department of India.

Tax returns contain all TDS deduction details collected by the payer, as well as other essential information like the Permanent Account Number of the payer and payee and other particulars regarding the payment made to the Government of India. It also collects TDS challan information.

There are several forms associated with TDS returns; the following table contains its relevant details.

Form number	Significance	Frequency of submission
Form 24Q	Statement containing details of TDS deducted from salary	Quarterly
Form 26Q	Statement containing details of TDS deducted from earning except salary	Quarterly
Form 26QB	Statement containing details of TDS deducted on income from the transfer of immovable asset (except agricultural land)	Should be submitted within 30 days from the end of the month when the deduction is made.
Form 26QC	Statement containing details of TDS deducted from payment of rent	Should be submitted within 30 days from the end of a particular month when the deduction is made.
Form 27Q	Statement containing details of TDS deducted on incomes earned from interest, dividend, or other sum payable	Quarterly

The person deducting TDS is also liable to provide an acknowledgement form to the taxpayer. It acts as proof that the necessary taxes have been paid and deposited to the Government. This certificate contains details like the particulars of payment, payee and payer details, date of tax deduction and date of credit submission. TDS certificate is necessary to claim tax credit or refund (if any) while filing Income Tax Return.

Different TDS certificates are issued against different TDS forms. These include –

TDS certificate	Respective TDS return form	Due date	Frequency of issue
Form 16	Form 24Q	Within 15th June of a Financial Year which succeeds a Financial Year when the tax is deducted	Annually
Form 16A	Form 26Q	Within 15 days of submitting Form 26Q	Once every quarter
Form 16B	Form 26QB	Within 15 days of submitting Form 26QB	Monthly
Form 16C	Form 26QC	Within 15 days of submitting Form 26QC	Monthly

 Due Dates of Different Forms

Taxpayers are liable to submit Forms containing TDS deduction details according to different due dates and quarters. For Financial Year 2019-2020, the dates are the following –

Quarter	Quarter period	Last date of filing
1st quarter	1st April to 30th June	31st July, 2019
2nd quarter	1st July to 30th September	31st October, 2019
3rd quarter	1st October to 31st December	31st January, 2020
4th quarter	1st January to 31st March	31st May, 2020

Penalty Provision

Any taxpayer not complying with the TDS deduction rules will be liable to pay penalties, usually in the form of fees and interest levied on the principal taxable amount. There are multiple types of penalties levied; for example –

• Regulation regarding tax deduction – Levied tax will be deducted when the actual payment is being paid. Any delay in tax deduction will be subjected to a penalty at 1% interest/month until the sum is deducted.

In case the person responsible for TDS deduction fails to do so, they are likely to be restricted from ascertaining the taxable profit from the total expenditure.

• Regulations regarding TDS payment – Taxpayers are required to pay the taxable sum to the Government of India by the 7th day of the month which succeeds the tax filing. Incidents of none or late payment will attract a penalty at 1.5% per month (on the total payable sum) till the sum is deposited.
• Regulations regarding TDS return filing – TDS returns should be filed on the 31st day of January, May, July, and October of every financial year. Non-filing or late filing of return will attract a penalty of Rs.200 every day (according to Section 234E of the Income Tax Act of India) till the return is filed. However, the penalty should not exceed the total sum of tax levied.

What is a TDS certificate?

There are different kinds of TDS certificates like Form 16, Form 16A, Form 16 B and Form 16 C. The entity applying TDS provides a certificate as proof of receipt.

For example, an employer issues Form 16 to at employee. The bank will provide a Form 16 A to a depositor when it deducts TDS on the interest an individual earns from fixed deposits.

Let us look at the different kinds of TDS certificates-

Form Type	Certificate For	Frequency	Due Date
Form 16	TDS On The Payment Of Salary	Yearly	31st May
Form 16 A	TDS On Non-Salary Payments	Quarterly	15 Days From The Due Date Of Return Filing
Form 16 B	TDS On Sale Of Property	Every Transaction	15 Days (From Return Filing Due Date)
Form 16 C	TDS On Rent	Every Transaction	15 Days (From The Due Date Of Returns Filing)

What is Form 26AS?

It is essential to understand how TDS and your PAN are linked. Deductions of TDS are linked to PAN in the case of the deductor as well as the deductee. If any part of your income has TDS charged on it, you are required to go through Form 26AS for Tax Credit. This form is an integrated tax statement that is provided to all individuals who have PAN. All TDS is linked up with an individual’s PAN. So, this form states the details of TDS on income by different deductors. It does not matter whether these payments are part of your salary, or interest that you earn. All TDS that is connected to your PAN is disclosed here. Form 26AS also has a record of the income tax that has been paid by you directly, whether it is self-assessment tax or advance tax.  This is precisely why it is so essential for you to enter your PAN details correctly, whenever your income is subjected to TDS.

TDS Rate Chart:

TDS Rate chart for FY 2021-22 (AY 2022-23)

Section	Nature of Payment	Threshold	Individual/HUF	Others
192	Salary	Taxable Income liable to Tax	Normal Slab Rate OR New Tax Regime Slab Rate as opted by employee. OPTION TO CHOOSE BETWEEN NEW AND OLD TAX SLAB REGIME FOR SALARIED EMPLOYEES	NA
192A	Premature withdrawal from EPF	50,000	10%	NA
193	Interest on securities	2,500	10%	10%
194	Dividend	5,000	10%	10%
194A	Interest on Bank Deposit/Post Office Deposit/Banking Co-Society Deposit	40000	10%	10%
194A	Interest on Bank Deposit/Post Office Deposit/Banking Co-Society Deposit (Payee:Senior Citizen)	50,000	10%	NA
194A	Interest other than “Interest on securities”(Other Than Bank Deposit/Post Office Deposit/Banking Co-Society Deposit)	5,000	10%	10%
194B	Winnings from lotteries, crossword puzzles, card games and other games of any sort	10,000	30%	30%
194BB	Winnings from horse races	10,000	30%	30%
194C	Payment to contractor/sub-contractor	Single Transaction: 30,000 & Aggregate of Transactions: 1,00,000	1%	2%
194D	Insurance commission	15,000	5%	10%
194DA	Payment in respect of life insurance policy	1,00,000	1%	1%
194E	Payment to non-resident sportsmen/sports association	–	20%	20%
194EE	Payment in respect of deposit under National Savings scheme	2,500	10%	10%
194F	Payment on account of repurchase of unit by Mutual Fund or Unit Trust of India	–	20%	20%
194G	Commission on sale of lottery tickets	15,000	5%	5%
194H	Commission or brokerage	15,000	5%	5%
194-I	Rent:
194I(a)	Rent of Plant & Machinery	2,40,000	2%	2%
194I(b)	Rent of Land or building or furniture or fitting	2,40,000	10%	10%
194-IA	Payment on transfer of certain immovable property other than agricultural land	50 Lakh	1%	1%
194-IB	Payment of rent by individual or HUF not liable to tax audit	50,000 per month	5%	NA
194-IC	Payment of monetary consideration under Joint Development Agreements	–	10%	10%
194J(a)	Fees for  technical services or towards royalty in the nature of consideration for sale, distribution or exhibition of cinematographic films;	30,000	2%	2%
194J(b)	Fees for professional  services	30,000	10.00%	10.00%
194K	Income in respect of units payable to resident person	–	10%	10%
194LA	Payment of compensation on acquisition of certain immovable property	2,50,000	10%	10%
194LB	Payment of interest on infrastructure debt fund to Non Resident	–	5%	5%
194LBA(1)	Business trust shall deduct tax while distributing, any interest received or receivable by it from a SPV or any income received from renting or leasing or letting out any real estate asset owned directly by it, to its unit holders.	–	10%	10%
194LBB	Investment fund paying an income to a unit holder [other than income which is exempt under Section 10(23FBB)]	–	10%	10%
194LBC	Income in respect of investment made in a securitisation trust (specified in Explanation of section115TCA)		25%	30%
194M	Payment of commission ( to a resident person by an Individual or a HUF who are not liable to deduct TDS under section 194C, 194H, or 194J.	50 Lakh	5%	5%
194N	Cash withdrawal during the previous year from one or more account maintained by a person with a banking company, co-operative society engaged in business of banking or a post office:in excess of 1 Crore	1 Crore	2%	2%
194-O	Payment or credit of amount by the e-commerce operator to e-commerce participant	5 Lakh	1%	1%

Form 49BTan Correction Form