How to file a 2007 tax return

how to file a 2007 tax return

E very person/individual or HUF (Hindu undivided family) - an assessee of any status, as per the Income Tax Act is liable to follow a certain statutory requirements to file a return of income.

It is mandatory for everybody to enter his/her PAN (permanent account number) correctly in the return form. The 'jurisdiction menu' will help you identify your assessing officer.

When total income - from all sources of income - of any person exceeds the maximum amount, which is not chargeable to income tax in any previous year ending on March 31, the person is liable to file the income-tax return.

Let us highlight a few basic income heads and then various steps or the procedure of computing. Heads of income include salaries, income from housing property, profits/gains of business/profession, capital gains, and income from other sources.

Computing procedure

While computing income from the above-mentioned different heads, the procedure is: First, the taxable income from each source is to be computed under each head of income by allowing deductions and then they are aggregated.

For example, in case of an assessee deriving income from his salary and housing property, and also in the form of interest

income from a fixed deposit in a bank, firstly, the taxable income under the head 'salaries', then 'income from housing property', and lastly, the taxable income under the head 'income from other sources' for bank interest etc will be computed.

Then all the three incomes under the three heads would be aggregated. From this amount, certain eligible deductions are made to arrive at the net taxable income on which tax is chargeable.

Tax deducted at source

The employer making payment to an assessee earning income from 'salary' deducts a certain amount of tax, from such payment(s) made during the financial year.

Such deduction from the payment is called 'tax deducted at source'. The payment, of TDS, to the government is treated as payment of tax on behalf of the assessee.

In case the assessee does not wish to furnish particulars of his income under other heads to his employer, he has to estimate his total taxable income under the different heads of income during the previous year, and pay tax on it (after excluding the TDS), by the due dates specified under the Income Tax Act. These payments are called 'advance tax payments'. (See Table I )


Category: Taxes

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