Click here to download Ionic Wealth portfolio tax calculator With the tax season approaching, filing your tax return meticulously is key to avoiding penalties and ensuring compliance. Here is a guide to place checks for appropriate disclosures and compliance.

Essential Checks: Income Tax Return

Below is a list of essential checks to review before filing your Income Tax Return:

Reporting Changes in your Income Tax Return

Unlike previous year’s ITR forms, the reporting requirements in the ITR forms for the financial year 2024-25 have significantly increased. You are required to furnish detailed information on deductions. The changes in the reporting requirements entail the following:

Important Documents required during ITR filing

• Realized Capital Gains Report

If you have sold shares, mutual funds, or other investments during the year, you need to obtain the realized capital gains report that accurately discloses the gains/losses of those sales.

• Form 16

If you are a salaried person, you should obtain Form 16 from your employer which helps you easily verify your income details for the year and the total tax deducted by your employer.

• Interest Certificates and Bank Statements

You need to collate annual bank statement and interest certificates from all banks that help you verify the total interest and dividend income earned during the year.

• HRA Rent Receipts

To claim House Rent Allowance (HRA) deduction, you need to keep handy the rent receipts, especially if you have not declared HRA to your employer during the year.

• Policy Details

To claim deductions for payment towards LIC, PPF, health insurance, etc. (section 80C & 80D), you need to make relevant disclosures of the policy details while claiming the deduction (like policy number, DIN, name of insurer etc.)

• Details of Housing/ Education Loan

An interest certificate to claim deductions of principal/ interest repayments of home/ education loan is required. Further disclosures of details like Institution name, A/c number, etc. are also to be disclosed.

Special Tax Incentive for Specified Professionals (Tax only on 50% Income)

[Specified Professionals include Doctors, Lawyers, Engineers, Accountants, Architects, Film Artists, Interior Designers, Technical Consultants, and any other notified professionals.]

Professionals earning up to Rs. 75 lakhs annually can simply opt for the presumptive taxation under section 44ADA of the Income Tax Act.

Under this scheme, 50% of gross receipts shall be taxed as the income of the professional. It offers a hassle-free route by eliminating the need for maintaining detailed books of account or undergoing a tax audit.

• To avail this benefit, it is important to ensure the following:

• The total earnings of the professional should not be more than Rs. 75 lakhs

Declared net income should be at least 50% of total gross receipts

(Example: If total gross receipts are Rs. 30 Lakhs, declared net income should not be less than Rs. 15 Lakhs)

• At least 95% of the receipts should be through digital modes.

Conclusion:

For filing the tax return, it is important for taxpayers that they have done a pre-check of the essential details to be filed with the tax department. This newsletter brings you a comprehensive guide designed to help you focus on the essential checks and navigate the key changes.

Disclaimer:

Angel One Investment Services Private Limited ("Ionic Wealth") is an AMFI-registered Mutual Fund Distributor (ARN 306165) and is a SEBI registered Research Analyst (Reg. no. INH000020305). The information contained in this newsletter is provided for informational purposes only and should not be construed as tax, legal, or investment advice. Recipients are advised to consult their independent tax and legal advisors for guidance specific to their individual circumstances. While every effort has been made to ensure accuracy, the Ionic Wealth assumes no liability for any errors or omissions.