Introduction: Tax filing season is around the corner, and planning ahead can save you from last-minute headaches. Here’s a detailed 10-point checklist to ensure a smooth and hassle-free tax compliance process.
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Determine Residential Status:
- Understand the criteria for resident, non-resident, and not ordinarily resident status based on days of stay in India.
- Check if you qualify as not ordinarily resident or an ordinary resident as per secondary conditions.
- Note the relevance of residential status in determining tax rates and treaty benefits.
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Choose Between Tax Regimes:
- Evaluate the benefits of the new default tax regime versus the old regime.
- File Form 10IE if opting out of the new regime with business income.
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Download 26AS and AIS:
- Obtain the latest Form 26AS and Annual Information Statement (AIS) for FY 2023-24.
- Cross-verify income and tax credit claimed with your tax return.
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Documentation for Income Sources:
- Gather essential documents for various income sources:
- Salary income: Form 16 and Form 12BA.
- Investment income: Bank statements, demat account records, dividend statements, and interest certificates.
- Rental income: Rental agreement, bank statements, municipal tax receipts, and housing loan statements.
- Business income: Audited accounts, income invoices, and expense records.
- Gather essential documents for various income sources:
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Clubbing of Family Member’s Income:
- Include minor children’s income from investments and spouse’s income from gifted assets in your return.
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Deductions and Exemptions:
- Retain receipts for tax deductions under your chosen regime.
- Maintain records of insurance premiums, donations, and eligible investments.
- Preserve purchase deeds and reinvestment proofs for capital gains exemptions.
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Foreign Tax Credit and Tax Residency Certificate:
- Claim credit for foreign taxes paid on doubly taxed foreign income as a resident individual.
- File Form 67 along with foreign tax payment proofs.
- Obtain a tax residency certificate from foreign regulators if a non-resident and file Form 10F to claim treaty benefits.
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Details for Key Schedules:
- Disclose assets and liabilities if income exceeds ₹50 lakh.
- Provide details of directorship and unlisted equity shares owned during the year.
- Complete Schedule FA for foreign assets and income.
Conclusion: Follow this checklist to ensure timely tax filings and navigate the process smoothly. Being proactive and well-prepared will help you approach the tax season with confidence.
