Salary and interest income up to Rs. 5 lakh – no filing of tax return required

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No more income tax return filing
There is some good news for the salaried tax payers having a taxable income, inclusive of salary and interest, of up to Rs. 5 lakh as they are no more required to file income-tax return (ITR) henceforth.

"No income-tax returns is required for salaried persons whose annual taxable income including salary and interest is up to Rs 5 lakh. We would shortly notify this," a Central Board of Direct Taxes official declared.

This provision would come into effect from the assessment year 2011-12 onwards which implies that the salaried persons who fall under this provision would not have to file ITR for the fiscal 2010-11 in the assessment year 2011-12. Further, as per a CBDT official, the scheme would not cover income from other sources such as house property, capital gains and gains from profession and business.

The salaried persons who wish to claim a tax refund would have to file ITR, under the current scheme. Those persons who want an exemption from filing ITR would have to disclose to their respective employers the incomes such as dividend and interest for tax deduction. The Form 16 that is issued to salaried employees would be taken as Income Tax Return.

View: This is a good move by the authorities. The tension of filing ITR every year for all those who owned a PAN card was a menance. Although, there is a chance that the ITR rule would be back few years down the line.

The better idea would have been if people who are allowed tax exemption should also be given the exemption to file ITR. 

Read more about: tax, economy, cbdt, personal finance
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