ITR - 1 Return Filing
Income tax return filing for an individual with salary income of less than Rs.5 lakhs.
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ITR 1 Filing Form
The Income Tax Department has put taxpayers into groups based on their salary and how they get it. This is done to make it easier for people to pay their taxes. In India, people with incomes of up to Rs.50 lakh can file ITR 1 Return.
This article is a full explanation of the ITR 1 Sahaj Form. The Income Tax Act of 1961 says that each type of person has to figure out how much of their income is taxed. After figuring out how much tax to pay, the person has to file the Income Tax Returns.
Who can fill out an ITR-1 Sahaj Form?
ITR 1 Sahaj Form is for individuals who make up to Rs.50 lakhs per year. People who get money from any of the following sources can fill out ITR 1 Sahaj Form:
- Salaried person: A salary is the payment or compensation that a person gets for the work that he or she has to do as part of the job contract. Under “salary income,” which is part of the Income Tax Act of 1961,
- Wages
- Pension
- Annuity
- Advance salary paid
- Leave Encashment
- Fee, prerequisites, commission, profits besides or in lieu id the salary or wages
- Transferred balance in recognized provident fund
- Annual accretion to the recognized provident fund
- Central Government contribution or an employer contribution to Pension account as mentioned in Section 80 CCD of the Income Tax Act.
- One house property: If the taxpayer is the owner of a property from which he or she is earning rent, the rent proceeds become taxable.
- However, if the taxpayer is using the owner of a property from which he or she is earning rent, the rent proceeds become taxable. However, if the taxpayer is using the property for running some business or profession the same would be taxable under the heading “Income from business or profession”.
- Other sources (does not include income earned from winning lottery or racehorses)
- Agricultural income (Upto to Rs. 5000)
Who cannot file ITR 1 Sahaj Form?
The following individuals are ineligible to file ITR 1 Sahaj Form:
A person whose income exceeds Rs. 50 lakh cannot use this ITR 1 Sahaj 1 Form.
This form cannot be used by a Director of a company who held unlisted equity shares during the financial year.
Non-residents and residents who are not conventional residents cannot file ITR 1 Sahaj Form.
Individuals who earned income from the following sources are ineligible to file Form ITR 1:
- House property more than one
- Lottery, Racehorses, Legal Gambling, etc.
- Taxable capital gains ( Both short term and long term)
- Agricultural Income when it exceeds Rs. 5,000
- An individual who is a resident of India and has assets outside India or the signing authority in any account based out of India
- Individuals claiming relief of foreign tax paid or double taxation relief under Section 90/90A/91.
Documents required to file ITR 1 Sahaj Form
What documents are required to file ITR 1 Sahaj Form?
The income Tax rate under the Existing Tax Regime and the New Tax Regime ( For TDS return Filing)
Taxpayers can now choose between the old and new tax systems. The decision to select a tax regime must be made at the start of the fiscal year.
The income tax rates under the old tax regime are:
For individuals up to the age of 60 years
| Taxable Income | Income Tax Rate |
|---|---|
| Up to INR 2,50,000 | Nil |
| INR 2,50,000 – INR5,00,000 | 5% |
| INR 5,00,000 – INR 10,00,000 | 20% |
| Above INR 10,00,000 | 30% |
For individuals aged between 60-80 years (Senior Citizen)
| Taxable Income | Income Tax Rate |
|---|---|
| Up to INR 3,00,000 | Nil |
| INR 3,00,000 – INR5,00,000 | 5% |
| INR 5,00,000 – INR 10,00,000 | 20% |
| Above INR 10,00,000 | 30% |
The new tax regime is one in which the taxpayer has the option of paying taxes at a reduced interest rate in accordance with the new tax regime in exchange for forgoing certain income tax exemptions and deductions.
or
The taxpayer may continue to pay taxes based on the current tax rates. The assessee can take advantage of rebates and exemptions by remaining in the old regime and paying taxes at the current high rates.
The income tax rates under the new tax regimes that is applicable for individuals and the HUFs is as follows:
| Income Slab | New regime tax slab rate(Applicable for all individuals and HUF) |
|---|---|
| Up to INR 2,50,000 | NIL |
| INR 2,50,000 – 3,00,000 | 5% (Tax rebate u/s 87 a is available) |
| INR 3,00,000 – 5,00,000 | |
| INR 5,00,000 – 7,50,000 | 10% |
| INR 7,50,000 – 10,00,000 | 15% |
| INR 10,00,000 – 12,50,000 | 20% |
| INR 12,50,000 – 15,00,000 | 25% |
| More than INR 15,00,000 | 30% |
Note:
The New Tax regime applies the same tax rates to all categories of individuals. Seniors and super-seniors will not, therefore, be eligible for an increase in the base exemption limit under the New Tax Regime.
Individuals with a Net Taxable Income less than or equal to Rs 5 lakh will be eligible for the tax rebate under section 87 A, and their tax liability will be nil under both the New and Old tax administrations.
Regardless of age, the exemption limit for NRIs is Rs. 2.5 lakh.
All income-tax liabilities will be increased by an additional 4% health and education cess (increased from 3% in FY 2018-19).
An applicable surcharge based on the tax rates listed below for each of the preceding categories:
- 10% of the income tax if total income > Rs. 50 lakh.
- 15% of the income tax if the total income > Rs.1 crore
- 25% of the income tax if the total income > Rs.2 crore.
- 37% of the income tax is the total income > Rs.5 crore.
What are the conditions to opt for a new tax regime?
If a taxpayer chooses concessional tax rates under the new tax regimes, he or she must forego exemptions and deductions available under the previous tax regime. There are a total of 70 allowable deductions, with the most common ones enumerated below.
The following exemptions and deductions are not permitted under the new income tax system:
List of common deductions allowed the New Tax Regime
Major Amendments to ITR 1 filing for the AY 2021-2022
The following changes are incorporated in the ITR Form:
- The taxpayer will not be able to file ITR 1 Form if the TDS is deducted under Section 194N. According to this, the tax shall be deducted at the source if the non-filters of the income tax return withdraw cash if exceeding the amount Rs.20 lakh. In other cases, tax shall be deducted if the cash withdrawals exceed Rs.1 crore in a financial year.
- There is no option is given to carry forward the TDS under Section 194N. The credit of TDS under section 194N. The credit of the TDS under section 194N should be allowed only during the year in which the TDS was deducted.
- Individuals or HUFs get an option to select old or new tax regimes. If the taxpayer selects the new tax regime under Section 115 BAC, he needs to file form 101E before filing the Income Tax Returns under Section 139(1).
- The ITR Forms of the assessment year 2020-2021 were modified by including the new schedule DI. It has allowed taxpayers to avail the deduction that is made during the extended period for the AY 2020-21. The Schedule DI is removed from AY 2021-22.
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