Wednesday, July 06, 2022

Income tax filing notes

After the Income Tax department (India) have changed to their new income tax e-filing portal last year, there were some teething troubles, but this year things seem to go smoothly. Or perhaps it is because I have learnt last year's lesson and did the first submission using the offline utility instead of online, since last year the offline utility was more stable than the online software. Or maybe because their documentation, help and faq sections are pretty good. Some notes, in no particular order.

  1. For e-verifying returns using Canara bank, if you don't want to use the ATM method, the way is to choose to e-verify "using bank account details" - that directly sends an SMS with the verification code (EVC) to the linked mobile phone, and we can enter the EVC to e-verify. Probably the easiest way to e-verify would be using the Aadhaar-linked OTP, in case the Aadhaar is linked to a mobile number.
  2. For filling up the csv in the Long Term Capital Gains, which is Schedule 112A in ITR2, there is an explanatory pdf linked from the button labelled "Need help ?" on the top right. NOT the Help menu item right at the top. Reading those instructions would be essential for correctly filling up the csv template. I got the required data from CAMS and KFin profit/loss statements for mutual fund gains and the old as well as new sale deeds for house sale proceeds.
  3. Filling up this 112A does not automatically fill up the quarterly gain/loss in the schedules BYLA etc - we need to fill them manually.
  4. When filling up ITR2, deduction for Interest income up to Rs. 10,000, (section 80TTA) comes under schedule VI-A, where we have to choose to expand "Part C, CA and D".
  5. After paying tax, we have to again go back to "Computation of Taxes" schedule, enter the Challan serial number and other details of the tax we have paid, and again compute till the tax to be paid is zero.
  6. The donations for which I usually get a 100% and 50% exemption without any qualifying limit were not accepted - the verification step failed with the error "same pan cannot be entered for different donation type", it would only accept it if entered as 100% and 50% "subject to qualifying limit", and the limit seems to be 10% of adjusted gross total income.
     


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