Indian Income Tax Act Sections You Should Know

Indian Income Tax Act Sections You Should Know

Are you subject to the Income Tax Act in India?

Individuals living in India are subject to the Income Tax Act, 1961.961. It means that you are subject to income tax under the provisions of this act, regardless of whether you have a permanent residence in India or not. A number of provisions of this act also apply to individuals who are temporarily residing in India for the purpose of doing business or travelling.

It has been noted that there are six main sections of the Income Tax Act that apply to individuals residing in India: Section 1 applies to individuals who are citizens of India or who are deemed to be Indian nationals for purposes of taxation.

  1. Section 2 of the Act is applicable to individuals who are not citizens of India and who are not ordinarily residents of India.

  2. A company registered under the Companies Act, 1956 is covered by section 3 of the Act.

  3. Trustees of trusts that are registered under the Trusts Act, 1925 are subject to the provisions of section 4.

  4. It should be noted that Section 5 applies to persons who are beneficiaries under pension schemes that are registered with the Pension Fund Regulatory and Development Authority (PFRDA), which is an independent regulatory authority.

  5. The provisions of sections 6 and 7 are applicable to non-resident Indians who have income derived from sources within the country.

Furthermore, there are a number of special provisions that apply specifically to individuals who reside in India and engage in business activities there in addition to the general provisions mentioned above. The section 194B of the Indian Income Tax Act allows taxpayers residing outside India to dispose of income arising from a business carried on outside India so long as the disposal does not result in an artificial price for the property or, in certain cases, does not result in a loss to the person who provides the property.

When do Indian companies file their tax returns?

Indian Income Tax Act 1961 applies to individuals and Hindu undivided families residing in India. The deadline for filing personal income tax returns coincides with the deadline for paying taxes. Individuals have until April 15th of the following year to pay their taxes. The due date for Hindu undivided families is July 15th of the year following the taxable year.

In India, what forms must individuals and businesses file?

Individuals must file their tax returns by April 15 of the following year (Form 1040).

If the business has taxable income of more than $1,000 or if the balance sheet item at the end of the previous fiscal year is worth more than $5,000, it must file a tax return for the previous financial year by April 15 of the following year (Form 1040).

If you do not file your tax return on time in India, what are the penalties?

You may be fined and/or imprisoned if you file your tax return late. The penalties for filing a late tax return depend on the type of tax you’re responsible for paying and the time period involved. In general, the harsher the penalties are, the more income you have and the more taxes you owe.

A late tax return can also result in your account being frozen or even closed. You may have difficulty accessing your money, borrowing from banks, or getting a mortgage if this is the case. Late tax returns can also cause other financial obligations to be deferred or even canceled.

To avoid penalties and ensure that your tax return is filed on time, you can take several steps. Prepare your return by gathering all the necessary information. Second, make sure you are aware of your deadlines. If your return is still within the applicable deadline, file it as soon as possible.

Know more: depreciation calculation as per income tax act

Individual Taxation

Taxes are imposed on individuals in India based on their taxable income. The term taxable income refers to all income from any source except net rental income and pension contributions. Rental income is the income you receive from renting out your own or leased property. Contributions to a pension plan are amounts you contribute.

An individual’s taxable income is determined by a statutory formula based on their total income and marital status. A person’s total income includes all sources of income, such as salaries, wages, tips, bonuses, investment dividends, interest, royalties, and rent from real estate. A person’s marital status refers to their relationship with their spouse at the time income is calculated

The Section 92CD Modified Return

An individual residing in India with income from any source is required to file a modified return under section 92cd. Under section 92cd of the Income Tax Act, your income and taxes are calculated.

When dealing with u/s 92cd modified returns, there are a few key points to consider. Identifying your taxable income is the first step. The total income is your income after all deductions have been taken into account, including any losses that you have suffered along the way.

In addition, you need to file a correct tax return in accordance with section 92CD modified return. It may be possible for you to end up paying fines and interest charges if you do not file a correct tax return using Section cd modified returns. If you are filing this section of the Income Tax Act, make sure to follow all instructions carefully.


As discussed in this article, India’s income tax act has different sections that apply to individuals. It is our hope that this article has provided you with the information you need to file your taxes efficiently and effectively.

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