Income tax registration

A taxpayer must register for Income Tax E-Filing in order to use the free governmental service, namely the Income Tax E-Filing website, which enables taxpayers to submit their income tax returns online. All taxpayer categories in India file their income tax returns via the Income Tax E-Filing website, which is available for free to all taxpayers. ITR-1, ITR-2, and ITR-4 returns can be conveniently filed using the income tax e-filing website by salaried persons and taxpayers who have chosen a presumptive taxation plan made available by the Act.

A taxpayer can utilise the income tax e-filing website in addition to filing their income tax return to examine other e-filed returns, check the status of their ITR, reply to income tax notices, and find out the status of their tax refund. Therefore, everyone with a taxable income of more than Rs. 2.5 lakhs must be informed of the processes for utilising the income tax e-filing website and have an account with the E-filing website managed by the Income Tax Department.

Important concepts and procedures under the Income tax act

(1) An assessee is a person for whom any tax or other amount due under the Act is payable (Section 2(7)).

(2) The term "assessment year" (Section 2(9)) refers to the 12-month period beginning on April 1 of each year and concluding on March 31 of the following year.

(3) Income generated in a year is subject to taxation in the next year (Section 3). The year that income is generated is referred to as the prior year, and the year that it becomes taxable after that is referred to as the assessment year.

(4) Income is referred to as having been received by a person when payment has actually been made, as opposed to having accrued to a person if a fixed and unconditional right to receive such income emerges in the person.

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(5) Belated Return: Section 139(4) states that a return that was not submitted by the deadline may still be submitted as a belated return up until the earlier of one year from the assessment year's end or the conclusion of the assessment process. However, a penalty of Rs. 5000/- u/s 271F would be applied to any unfiled income tax returns by the end of the pertinent assessment year.

(6) Revised Return: If someone who submitted their return on time finds an error or omission, they may file a revised return before the end of the assessment year, the end of the assessment year, or both, whichever comes first.

(7) Processing under Section 143(1): The Finance Act of 2008 has reinstated procedures for fixing mathematical errors or internal inconsistencies during the processing of returns. As a result, it has been stipulated that during the processing stage, the total income shall be calculated after corrections for any mathematical errors in the return or any incorrect claims that are evident from the information in the return, and if on such computation, any tax, interest, or refund is found due on adjustment of TDS, advance tax, or self-assessment tax, then an intimation specifying the amount payable shall be prepared/generated or issued to the assessee. Any refunds that are discovered to be owed must be given with an accompanying notification. The return acknowledgement is considered to be an indication of no demand or reimbursement is made. Such an announcement must be made within a year after the end of the fiscal year in which the return was filed.

(8) Assessment in accordance with Section 143(3): If the Assessing Officer determines, based on the return submitted by the Assessee, that it is necessary to verify that the Assessee has not understated his income, he must give the Assessee a notice under Section 143(2) and, after obtaining the information he may need, complete the assessment (commonly known as a scrutiny assessment) in accordance with Section 143(3).

(9) Correction of error pursuant to Section 154: If any order issued by an income tax authority contains an obvious error, the assessee may request its correction prior to the passage of four years from the end of the fiscal year in which the relevant order was issued. The Income Tax Authority must respond to an application for rectification under this Section lodged by the Assessee on or after 1.6.2001 within six months after the end of the month in which the application is received, according to the Finance Act 2001.

(10) Interest on refunds under Section 244A: From April 1 of the assessment year to the day the refund is given, the assessee is entitled to simple interest at a rate of 0.5% per month (placed for 0.67% per month effective September 8, 2003), or a portion thereof.

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