đ️ India's Income Tax Act, 1961 | Key Features and Guidelines.
India's Income Tax Act, 1961
Your comprehensive guide to understanding India's tax laws.
Overview
The Income Tax Act, 1961, governs the levy, collection, and management of income taxes in India. It came into effect on April 1, 1962, and covers taxation for individuals, businesses, and other entities.
Key Features
- Income Sources: Taxable income is classified under Salary, House Property, Business/Profession, Capital Gains, and Other Sources.
- Tax Slabs: Progressive tax rates are applied based on annual income.
- TDS: Tax is deducted at the source for specific income categories.
- ITR Filing: Annual filing of income tax returns is mandatory for eligible taxpayers.
Deductions and Exemptions
| Section | Description |
|---|---|
| 80C | Tax benefits on investments (e.g., LIC, PPF, EPF). |
| 80D | Deductions for health insurance premiums. |
| 80G | Tax relief on donations. |
| 80E | Deductions on education loan interest. |
ITR Forms and Applicability
The Income Tax Department offers various ITR forms for different categories of taxpayers:
- ITR-1: For individuals earning from salary, one house property, and other sources.
- ITR-2: For individuals not having income from business/profession.
- ITR-3: For individuals earning from business/profession.
- ITR-5: For partnerships, LLPs, and associations.
Governing Bodies
The Income Tax Act is enforced by the following:
- CBDT (Central Board of Direct Taxes): Oversees implementation and administration of direct taxes.
- Income Tax Department: Responsible for tax collection and resolution of taxpayer issues.
