Income Tax Return (ITR) Filing For Professionals | E-filing ITR by Bizfoc

In India, individuals compulsorily file an income tax return, in case their total income surpasses the basic exemption limit. The basic exemption limit lies between Rs. 2.5 lakh - Rs. 3 lakh approximately. There are several ITR forms available on the income tax department portal for filing ITR, an individual needs to choose an appropriate form as per their income levels as well as the sources of income. Here we are going to explore the Income tax return filing for professionals, documents required, benefits, and the process. Bizfoc provides you with various services related to ITR filing and their compliance according to regulatory guidelines.

What do you mean by ITR Filing for Professionals?

ITR filing for professionals is a procedure of submitting an ITR by individuals who are involved in several occupations or professions. It is compulsory to file in case their whole income exceeds the basic exemption limit set by the government of India on an annual basis. Thus, the professionals, who are lawyers, freelancers, doctors, consultants, and others, require to file their earned income from the source of providing professional services, along with any other sources of income, deductions, and tax liabilities.

They need to choose the relevant form for filing ITR by the Income Tax Department of India, ensuring compliance with tax regulations and providing reliability of assessment and tax collection on professional earnings.

Documents Required for Income Tax Return Filing

There are several necessary documents required for ITR filing:

• Aadhaar Card
• PAN Card
• Bank account details
• Form 16 (salary and TDS details)
• Form 26AS (tax credit statement)
• Receipts for tax exemptions or deductions (if applicable)
• Bank interest statements
• Capital gains statements (for asset sales)
• Documents related to foreign assets and income (if applicable)

Income Tax Forms List for Professionals

Here are seven ITR forms for professionals:

• ITR-1: Individuals (residents) having income from salary, one house property, other sources, agricultural income less than Rs 5,000 and with a total income of up to Rs 50 lakh.
• ITR-2: Individuals/HUFs not having any business or profession under any proprietorship, more than one house property. Income from sale of investment/capital gain, foreign sources, holding unlisted equity shares.
• ITR-3: Individuals/HUFs having income from a proprietary business or profession, income of a person as a partner in a firm.
• ITR-4: Individuals/HUFs having presumptive income from business or profession, one house property.
• ITR-5: Partnership firms or LLPs.
• ITR-6: Companies.
• ITR-7: Trusts.

Benefits of E-Filing ITR (Income Tax Return) for Professionals

Filing your income tax return offers numerous benefits that streamline your financial management. Here's how it can enhance your financial well-being:

1. Uses losses effectively: Filing tax makes sure the past losses will carry forward, leveraging them to reduce future tax liabilities.
2. Reduce Tax Notices: E-filing reduces the likelihood of errors, minimizing the chance of receiving notices from tax authorities.
3. Maintain Financial Records: E-filing promotes better record-keeping, simplifying money management and financial planning.
4. Expedite Tax Refunds: Filing leads to quick tax refunds, giving a timely financial boost.
5. Provide Financial Planning: It leads to regular assessment of your financial status, empowering you to devise effective financial strategies for the future.
6. Develop Creditworthiness: Maintaining a clean tax record via e-filing can bolster your credit score, facilitating easier access to credit and loans.

Procedure of Filing ITR for Professionals in India

There is a step-by-step guide to file ITR for professionals in India:

1. Step 01. Submission of Document: First, collect all necessary documents in soft and scanned copies. These documents include salary slips, the last year's tax return, bank statements, and investment proofs.
2. Step 02. Online Registration on ITR website: Submit all necessary documents to the Bizfoc team of experts, protected by our designated platform. Our team will verify all documents to ensure reliability and completeness.
3. Step 03. Filing of ITR Form: Based on employment status, source of income, and other relevant elements, the correct ITR form will be decided. Our team will make sure all appropriate information is filed in the form.
4. Step 04. Tax Liability Payment: After claiming all exemptions and deductions, our team will calculate the total taxable income and corresponding tax liabilities. If any tax payment is applicable, our experts will connect with you and inform you, ensuring transparency and clarity on your financial obligations.
5. Step 05. Final Submission: Our team will submit your ITR after receiving your approval and file it online through the ITR registration portal. Once done, you will receive a successful filing confirmation along with acknowledgement receipts.

Income Tax Slab for AY 2024-2025

For Individual (Resident or Non-Resident) of any age anytime during the previous year:

Implications of Not Filing ITR in India

There will be penalties for Non-Filing Income Tax Returns in India as follows:

1. Charges for Late Filing: After the due date of filing ITR, it incurs late fees, approximately ₹5,000 to ₹10,000, depending on the filing date.
2. Imprisonment: Consistent non-compliance may lead to legal proceedings and imprisonment ranging from 3 months to 7 years, along with fines.
3. Effect on Credit Rating: Late filings can cause lower credit scores, affect interest rates, and impact loan eligibility.
4. Interest on Outstanding Taxes: Filing ITR late will trigger 1% per month interest charges on unpaid tax amounts, accruing from the due date until payment.
5. Forfeiture of Deductions: Delayed filings may forfeit deductions and exemptions, leading to higher tax liabilities and reduced tax savings.

Why Choose Bizfoc for E-filing ITR?

Bizfoc streamlines your government interactions by handling all paperwork, providing clear guidance on processes, and preemptively addressing your queries with our experienced business advisors. Connect with our experts at Bizfoc for filing Income Tax Return (ITR) of your professional income and avoid heavy penalties on late filing. Our years of experience in Tax filing and tax planning can save your time and money.

Frequently Asked Questions (FAQs)