savings-over-the-years

Question BankCategory: Income Taxsavings-over-the-years
AvatarKollipara sundaraiah asked 7 months ago

How to show savings accumulated over the year\’s filed return. Ex: Assess savings 2 lacs a year for the last 10 years. 2 lacs savings for year have been shown in the I.t. returns of each year.20 lacs savings. Question: How to show has capital of 20 lacs.

1 Answers
AvatarS. Bindra answered 7 months ago

As per your query:-
An assessee is saving rs. 2 lakh per year and his total accumulated capital is Rs. 20 lakh in last ten year. Then how can he show this accumulated capital in Income tax Return.
Solution:-
The answer to the above question depends on which points as given below:-
(1) If assessee is An Individual (not a company, firm etc.) and not having income from PGBP.
If assessee is an indivvidual not having any income from business or profession , then he is not required to show his accumulated saving in Income tax Return (ITR). He may be filing form ITR-1 or ITR-2 and there is no column to show his accumulated saving/capital in ITR. He just needs to show all the incomes of the current year and exempt income is also to be shown under the column provided for exempted income. He can keep his capital account in his excel sheet and he can not file this capital account with income tax return. 
In future if assessee spends huge amount and if he is served with a notice from income tax department to show his source of income for such spending then he may produce his capital account showing;

  • Income (both taxable & exempt) earned for each year. (Should be supported by each year ITR)
  • expenses for each year.
  • Net savings each year.
  • balance capital as on date.

(2) If assessee is An Individual (not a company, firm etc.) and having income from PGBP but not required to maintain books of accounts:-
In this situation also, assessee is not required to maintain and file books of account with Income tax return. But he can keep his capital account with him, as explained in (1) above. 
(3) If assessee is An Individual (not a company, firm etc.) and having income from PGBP and required to maintain books of accounts:-
In this situation, assessee is required to maintain and file books of account with Income tax return. He has to fill his all the records of income and expenses and capital account with the Income tax return. In this case assess has to file ITR-3 form and capital account can be file under part-A-BS of ITR-3.
(4) If assessee is a company or firm etc.:-
In this case, assessee can file his capital account with his ITR in the applicable form of income tax return along with Balance sheet and P&L account. 
 

Your Answer

7 + 16 =