Did you intend your taxes for the present evaluation 12 months (AY2022-23) as per the brand new tax regime however missed submitting the revenue tax return (ITR) by the 31 July deadline? Properly, you’re in for an disagreeable shock. Earnings Tax (I-T) legal guidelines don’t enable taxpayers to file belated ITR beneath the brand new tax regime, which might imply that each one belated ITRs must be mandatorily filed as per the outdated regime.
“The I-T division has taken away the good thing about decrease taxes by way of the brand new regime in returns filed belatedly in order to encourage taxpayers to file throughout the deadline,” stated Karan Batra, founder and CEO, charteredclub.com. Tax charges beneath the brand new regime are decrease for incomes as much as ₹15 lakh.
Issues will get sophisticated for these taxpayers who’ve paid their advance tax or requested their employer to calculate TDS legal responsibility as per the brand new tax regime as they’re most certainly taking a look at the next tax legal responsibility now. “In such instances, it may end up in modifications within the tax legal responsibility, which taxpayers must adhere to,” stated Deepak Jain, chief government, TaxManager.in, a tax e-Submitting and compliance administration portal.
Mint solutions among the key questions that this tax rule raises.
1. I opted for the brand new tax regime within the final evaluation 12 months. Do I nonetheless have to file belated ITR beneath the outdated regime this 12 months?
It is going to differ relying on whether or not you’re a salaried taxpayer or have revenue from enterprise or occupation. The previous is required to pick out between the 2 regimes yearly whereas submitting their ITR. Salaried people who opted for the brand new regime within the final evaluation 12 months and are submitting a belated returns this 12 months won’t have the choice to proceed with the brand new regime this 12 months. They must file their tax returns beneath the outdated regime.
Guidelines are completely different for self-employed people. “Taxpayers who’ve revenue from enterprise or occupation have to decide on the regime solely as soon as and may proceed in the identical regime even when they file a belated return. Subsequently, this rule impacts taxpayers with revenue from enterprise or occupation solely within the first 12 months, whereas different taxpayers get affected yearly,” stated Prakash Hegde, a Bangalore-based chartered accountant.
2. On my request, my employer deducted tax at supply as per the brand new tax regime. Can I get Kind-16 modified?
Whereas, technically, you will get your Kind 16 revised, this request might face sensible challenges. “It’s unlikely that the employer would agree as a result of there could also be curiosity and late submitting charges payable by the employer,” stated Neeraj Agarwala, Companion, Nangia Andersen India.
Batra suggests utilizing revenue tax calculator obtainable on the IT web site to calculate the brand new tax legal responsibility. “Alternatively, when the taxpayer fills in all the knowledge within the ITR, they’ll be proven the ultimate tax legal responsibility together with the relevant curiosity and charges,” he stated.
3. I’ve paid advance tax as per tax legal responsibility calculated beneath the brand new regime. What ought to I do?
It is advisable calculate your tax legal responsibility once more as per the outdated regime and pay extra tax, if any. Take observe that if extra tax legal responsibility arises, you’ll have to pay 1% curiosity beneath part 234C for delay in paying advance tax.
“This may kick in from the primary instalment of advance tax, i.e., 15 June, and is calculated in proportion to the tax due,” stated Jain.
This curiosity is over and above the 1% curiosity that taxpayers must pay on excellent tax beneath part 234A for defaulting on ITR submitting throughout the due date. Successfully, when you’ve got excellent tax, you’ll pay 2% month-to-month curiosity on it put up 31 July.
4. I didn’t make any tax-saving investments as I needed to go for the brand new regime. Are there any tax breaks that I can now declare?
There are particular expenditures that qualify for tax deductions. Medical bills as much as ₹50,000 of uninsured dad and mom aged 60 years and above and as much as ₹5,000 spent on preventive well being check-ups of self, partner, youngsters or dad and mom may be claimed as deduction. Preventive well being check-ups fall beneath the general ₹25,000 ceiling of part 80D.
Other than these, stamp responsibility and registration payment on home buy and youngsters’s tuition payment (for each college and faculty) may be claimed beneath part 80C ₹1.5 lakh restrict. Donation, too, qualifies for deduction beneath Part 80G.
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