Income tax return is a document giving the tax collector information about the taxpayer’s tax liability. It is a completed tax form, with details of income and allowances. Income Tax is a direct tax and is imposed on Business income, employment income-including benefits, rent income, pensions and investment income among others. Also called announcement of income, tax return.
PIN or Personal Identification number which is a unique computer generated number given to every person with income chargeable to income tax. The law requires very person with chargeable income to obtain PIN.
The Self-Assessment return is a form which a taxpayer is required to announce his income and calculate his tax liability. The self assessments return should be accomplished and submitted to the home taxes.
Along with direct taxes, income tax is one of the key sources of revenue. It is progressive tax scheme. Income tax is compulsory on the basis of capability to pay. The more taxpayer earns the more he should pay- is the vital principle of charging income tax. It endeavors at ensuring equity and social justice.
For the purpose of computation of totality of income and charging tax thereon, foundation of income can be classified into seven groups which are as follows:
- Salary or remuneration
- Interest on securities
- Income from residence assets
- Income from farming
- Income from business or profession
- wealth gains
- Income from other foundation.