Why is it necessary for taxpayers to break down dividend income by quarter?

Why is it necessary for taxpayers to break down dividend income by quarter?

The deadline to file an income tax return (ITR) for the assessment year 2021-22 is December 31st. As a result, when submitting ITRs, income taxpayers should keep in mind some adjustments made by the IRS.

One such change that a taxpayer cannot afford to overlook while completing ITR for AY 2021-22 is the reporting of dividend income. Taxpayers must now break down their dividend income by quarter. It will assist them in reducing their income tax liability.

 “Changes in dividend income tax that a taxpayer needs to remember while filing ITR for AY 2021-22,” “Dividend income up to ten lakh rupees in a single year was not taxable for taxpayers prior to the Financial Year FY21 because organizations had to pay a Dividend Distribution Tax (DDT) before making dividend payments. Those who got dividends of more than ten lakh rupees, on the other hand, used to pay only ten percent tax on the dividend payout. The Government, however, has made dividends distributed by an organization taxable beginning in FY21.”

Read More…

[pt_view id=”baa39696xe”]

 Income taxpayers to report quarter-by-quarter breakup of dividend income when filing ITR for AY 2021-22 “Taxpayers must now provide a quarter-by-quarter breakdown of dividend income received in a financial year in order to calculate interest for failure to pay an advance tax liability. It will assist taxpayers in reducing their income tax liability, as taxpayers must now pay advance tax in the quarter in which dividend income is received.

The Internal Revenue Service is urging taxpayers to file ITRs before the December 31 deadline.

” Even for a regular income taxpayer, if there is dividend income, it must be declared in quarter-by-quarter split, or their ITR form would be rejected.

To prevent having one’s ITR form rejected, the taxpayer must state the following dividend income breakup:
  •  From April 1st to June 15th, 2020;
  •  From June 16th to September 15th, 2020;
  •  From September 16, 2020, through December 15, 2020;
  •  From December 16, 2020, to March 15, 2021; and
  •  From March 16th to March 31st, 2021.

Know why ITR reporting deadline for FY 2020-21 may be extended to December 31

Know why ITR reporting deadline for FY 2020-21 may be extended to December 31

The deadline to submit an income tax return (ITR) for the fiscal year 2020-21 is December 31, 2021. This deadline has already been pushed back twice, first from July 31 to September 30, 2021, and again to December 31, 2021. Chartered accountants and tax specialists, on the other hand, believe that there is a rationale for extending the ITR reporting date for people (whose accounts are not required to be audited)

In comparison to the previous fiscal year, FY2019-20, fewer taxpayers have filed their ITR this year in FY2020-21. According to a tweet from the Income Tax Department’s official Twitter account on January 11, 2021, more than 5.95 crore ITRs were filed for FY 2019-20. 

(January 10, 2021 was the last date to file ITR for FY2019-20). However, data shows that a little more than 3.59 crore ITRs had been filed as of December 15, 2021. With fewer than 15 days until the deadline of December 31, 2021, 2.36 crore ITRs are yet to be filed.

With less than 15 days to go, it’s probable that the rest of the people will be unable to file their tax returns due to the numerous faults that have been recorded on the newly established income tax system. It remains to be seen whether the newly opened e-filing income tax portal can handle the volume of people reporting ITRs at the same time in such a short period of time.

Read More…

[pt_view id=”baa39696xe”]

Furthermore, for FY 2019-20, the government delayed the deadline for filing ITRs three times – initially from July 31 to November 30, then to December 31, and finally to January 10, 2021. The extension was granted despite the fact that the old tax filing portal was still in use, and there was no fear of new Covid-19 variations at the time.

“For individual taxpayers who are not subject to a tax audit, the extended deadline for filing taxes is December 31, 2021. Several issues with the new JSON utility continue, making it difficult for taxpayers to file their tax returns by the deadline. For example, problems in the utility linked to the computation of qualified donations and losses on residential property under the simplified tax regime must be resolved quickly. There are also operational difficulties. 

For example, the e-filing platform is excessively slow, and without an Indian cell phone or net banking, filing Form 67, which is essential for claiming foreign tax credit, and changing the password is still not possible. Furthermore, the AIS and TIS were just recently made accessible, leaving taxpayers with very little time to evaluate them before the end of the year.

Frequent Errors That Taxpayers Should Avoid While Preparing Tax Returns.

“In comparison to last year, around 50% of people have been able to file their tax returns. As a result, more than 3.5 crore tax returns must be filed in the next 15 days, which is a massive amount. Furthermore, the income tax website is brand new this year, with features such as pre-fill data, the Annual Information Statement (AIS), the Taxpayer Information Summary (TIS), and more. We anticipate the administration will make an informed choice in the next 5 to 10 days after considering all of the elements and scenarios.”

“The Income Tax Department has put out the Annual Information Statement (AIS), which gathers extensive financial data of the taxpayer, beginning with the financial year 2020-21 (i.e. for the year ended March 2021).” As a result, it is critical for the taxpayer to ensure that they have not only reconciled their income and reporting requirements with the Form 26AS, but also that they have thoroughly checked their reportable transactions / income that appears in the AIS. 

For the Financial Year 2020-21, the AIS database was just made available, which has resulted in an additional level of review that the taxpayer must complete before completing their tax return. AIS provides extensive information such as interest on bank accounts, securities transactions, mutual fund transactions, overseas transfers, deposit data, and so on. Given the income tax department’s delay in releasing AIS data on the new income tax portal, taxpayers must be given appropriate additional time to complete the process and ensure that their returns are complete in terms of income reporting and disclosure obligations.”

Be aware of these points before filing an Income Tax Return

Be aware of these points before filing an Income Tax Return

The deadline for filing an income tax return (ITR) is December 31, 2021. To prevent a last-minute rush, those taxpayers who have not yet filed their Income Tax Returns for Assessment Year (AY) 2021-2022 must do so as soon as possible. When submitting an ITR, taxpayers must be aware of the information provided by the IRS.

From April 1, 2021 to December 13, 2021, the Central Board of Direct Taxes (CBDT) provided refunds of over Rs. 1,36,779 crore to over 1.27 lakh taxpayers. In 1,25,34,644 cases, income tax refunds totaling Rs 46,438 crore were issued, while corporate tax refunds totaling Rs 90,340 crore were awarded in 2,02,705 cases. Income Tax India stated that this comprises 90.95 lakh refunds of Rs 18, 848.60 crore for the fiscal year 2021-22.

The Income Tax Department has strongly advised all taxpayers to see their Form 26AS and Annual Information Statement (AIS) through the e-filing site http://incometax.gov.in to verify the accuracy of TDS and Tax Payments and to take advantage of ITR pre-filling.

Read More…

[pt_view id=”baa39696xe”]

It is important for taxpayers to cross check the data in the AIS statement with their bank passbook, interest certificate, Form 16, and capital gains statement from brokerages in case of purchase and sale of equity or mutual funds.

There will be no ITR for certain senior citizens.

A new section 194P has been inserted into the Income Tax Act, 1961, by the Finance Act, 2021, to provide that senior citizens over the age of 75 who only have pension income and interest income from the account(s) maintained with the bank in which they receive such pension do not need to file an ITR, according to Income Tax India.

Relief Measures for Covid-19

The amount received by a taxpayer for medical treatment from an employer or from any person for Covid-19 treatment throughout the financial year and following years will be exempt from income tax. India’s Income Tax Department sent out a tweet.

Income Tax Return: The Government Provides Significant Clarification Regarding the ITR Process

  • You can rest easier if you file your ITR as soon as possible. Income Tax India tweeted, “Filed Income Tax Return for AY 2021-22, e-verified it, returns got processed, and refund credited to the bank.”
  • “Dear taxpaying public! Income Tax India tweeted, “Here’s what you need to remember before filing your return this weekend.”
  • ITR1 is required for those having a wage and interest income, as well as income from a single dwelling property.
  • ITR2 is required for those with income from more than one dwelling property or capital gains.
  • “Filing your tax return has never been easier because we’ve prefilled part of your information!” India’s Income Tax Department sent out a tweet.
  • Form 16, bank statement, interest certificate from bank, housing loan interest statement, if any, rental receipts and house property tax, if any, capital gains statement from broker, if any, 26AS and Annual Information Statement are among the documents required (AIS).

The helplines for the Income Tax Department are 1800 103 0025 and 1800 419 0025, respectively.