Income tax return is the document giving the tax collector information about the tax payer’s liability.
It is a legal obligation of each individual to file taxes if in the whose taxable income during the year has exceeded the exemption limit of Rs. 1, 00,000 (Rs. 1, 35,000 for females and Rs. 1, 85,000 for senior citizens.)
Some common documents to be kept ready for filing return is
1. Form No. 16 received from the employer. This will help to know income from the salary and the tax already deducted by the employer.
2. Form No. 16A received from all the payers who have deducted tax. This needs to get collected from all parties who have deducted tax while making payments to you. This will include banks where FD’s have been kept, tenants who have paid rent after deducting taxes etc.
3. Summary of all bank accounts: The summary will give an idea about all the income earned during the year and all the expenses made.
4. Details of property owned: If any property has been bought and there is any rent received receipts and any municipal tax paid on it such details need to be carried. If there is a loan and interest is being paid the certificate of such payments need to be mentioned.
5. Sale and purchase bills/documents/contract notes in respect of investments/ assets needs to be kept. In case there is a huge transaction of purchase and sale then it is advisable to prepare a statement of sale and corresponding purchase. This will help in arriving at the amount of actual profit or loss made to calculate taxable income.
6. Details of tax paid during the year only if advance tax is paid.