For those of you who have been stashing away cash (unaccounted for, naturally), and have that side business income you're trying hard to hide, the taxman is coming to town. So, if you have anything monetary to declare, do it fast.
If you are not disclosing your income, or don't pay your yearly annual dues, you may be on the wrong side of the law. How, then, do you determine whether you belong to the tax-paying segment of the population?
Basically, anyone who earns above Rs. 50,000 per annum is supposed to pay a part of their income as taxes. If you are in the earning bracket of Rs. 50,001-60,000, your tax rate is at 10 per cent; Rs.60,001 - Rs.1,50,000 is 20 per cent; while it's 30 per cent for an income over Rs.1,50,000. Those complaining should be told that taxes in India are considerably lower than in many parts of the world, such as Canada and Australia.
Taxes also have to be paid for any income that arises out of owning property, profits and gains from a business / profession, capital gains or any other sources. To find out about which head your income belongs to, check out this useful section at India Infoline Income Tax.
If you think big brother is going to take all your hard earned money away, relax. Relief is available in the form of standard deductions which help you reduce your tax burden when you invest in certain specified instruments such as pension funds, life insurance, donations, etc. A detailed break-up of the tax rebates is available at Taxation India. Its IT Ready Reckoner has information on a variety of tax related information such as deductions / allowances, list of tax-free incomes, refunds, etc.
If you are interested in finding out how much your tax liability is for the current year, online tax calculators can solve the problem. Try the Tax Calculator available at Taxation India, which will give you the result, depending upon whether you are an individual, domestic company, HUF or a partnership. My Wealth Guide also offers a Personal Income Tax Calculator to help you calculate your tax liabilities.
To identify a person, the Tax Department (Government of India) now issues a number called Permanent Account Number (PAN) in the form of a laminated card. If you are an income tax payee, you need to apply for a PAN, and download a printable application form here.
So what's your net worth? That's an essential piece of information needed in order to help you get a grip on your financial affairs. Try this tool to calculate the real value of your possessions and assets. If the figure is not what you expected, head towards the Wealth Builder section -- probably what we all need in these taxing times.
In India, the due date to file returns in the case of people who fall under the 'salary income' (not business income) category, is June 30. For people who have business income, but whose accounts are not required to be audited under any law, the due date is August 31. To know more about filing your returns, the FAQ at Esaral Tax tells you more about the process. Documents you will need to provide along with your returns are listed here.
Documentary proof is required while filing returns of any tax deducted at source, and investments and payments that can allow you to claim rebates, along with your employer's certificate in Form 16. While taxes cannot be filed online yet, Esaral Tax helps an individual file returns on a fee basis. The service is, however, only for residents of Maharashtra.
You can also use the services on sites like Etax-India and File My Returns, but you will need to register with them first to access any information.
Filing taxes has always been a messy affair. But, with so many facilities online, you won't have too many excuses to avoid that taxman. Don't say we didn't warn you.
ADDITIONAL LINKS
Indian Taxes
A complete portal on Indian Tax Laws, Income Tax Act, and Tax Rates. You can even become your own Tax Advisor or Investment Planner.
Taxation India
Forms that can be downloaded include Form 2D, 3 for salaried people, Form 2 for Business Income as well as a PAN application form.
Ministry of Finance
Follow developments at the Departments of Economic Affairs, Expenditure, Revenue and Finance.
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