What Is Notice 143(1) Under Income Tax?

Notice under Section 143(1) is an intimation issued by the Income Tax Department after processing your Income Tax Return (ITR).
It is not a scrutiny notice, but a communication informing the taxpayer about the outcome of return processing.

This notice confirms whether:

• The return filed matches departmental records
• There is a tax payable, refund, or no demand / no refund

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Why Is Notice 143(1) Issued?

Notice 143(1) is issued to:

• Verify arithmetical accuracy of ITR
• Check internal consistency of data
• Match income and TDS with Form 26AS / AIS
• Adjust incorrect claims, if any

It is automatically generated by the system after ITR processing.

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Types of Intimation Under Section 143(1)

1. No Demand – No Refund

✔ Return accepted as filed
✔ No action required

2. Refund Intimation

✔ Excess tax paid
✔ Refund credited to bank account

3. Demand Notice

⚠ Additional tax payable due to:

• Income mismatch
• Incorrect deduction claim
• TDS mismatch

Tax must be paid within the specified time.

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Is Notice 143(1) Mandatory for Every Taxpayer?

Yes.
If you have filed an income tax return, the department may issue a 143(1) intimation:

• Via registered email
• On the income tax portal

However, if no intimation is received within 9 months from the end of the financial year, the return is deemed accepted.

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Difference Between 143(1) and Scrutiny Notice

Particulars	Section 143(1)	Scrutiny Notice
Nature	Intimation	Investigation
Personal hearing	No	Yes
Documents required	No	Yes
Serious proceeding	No	Yes

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How to Check Notice 143(1) on Income Tax Portal (Step-by-Step)

Step 1: Login to Income Tax Portal

• Visit the official income tax e-filing portal
• Login using PAN and password

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Step 2: Go to e-Proceedings / View Notices

• Click on Pending Actions or e-Proceedings
• Select View Notices / Intimations

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Step 3: Select Assessment Year

• Choose the relevant Assessment Year
• Look for Intimation under Section 143(1)

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Step 4: Download the Notice

• Click on download
• Open the PDF using password (PAN + DOB)

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Step 5: Review the Intimation Carefully

Check:

• Income as per return
• Income as per department
• Tax payable or refund
• Adjustments made, if any

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What to Do After Receiving Notice 143(1)?

If No Demand / Refund

✔ Keep the notice for records

If Refund Is Issued

✔ Track refund status
✔ Ensure bank account is validated

If Demand Is Raised

• Pay tax within due date
• Or file rectification request if incorrect

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Can Notice 143(1) Be Rectified?

Yes.
If the notice contains errors due to:

• TDS mismatch
• Data entry mistakes
• Incorrect adjustments

You can file a rectification request under Section 154 on the income tax portal.

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Common Mistakes to Avoid

• Ignoring 143(1) demand notice
• Not verifying ITR data with AIS
• Missing tax payment deadline
• Assuming 143(1) is scrutiny notice

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Why Choose Saving Mantra for Income Tax Notices?

• Expert review of 143(1) intimations
• Demand vs rectification analysis
• End-to-end notice handling
• Fast resolution & compliance support
• Notice-to-closure assistance

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Disclaimer

This blog is for informational purposes only and does not constitute legal or tax advice. Intimation under Section 143(1) is subject to the Income Tax Act, 1961, and automated system processing. Outcomes may vary based on individual return data. Saving Mantra recommends consulting a qualified tax professional before taking action on any income tax notice.

What Is Income Tax Appeal?

An Income Tax Appeal is a legal remedy available to a taxpayer who is not satisfied with an order passed by the Assessing Officer (AO), such as:

• Assessment order
• Penalty order
• Rectification order
• Demand order

Appeals are filed online before the Income Tax Department through the faceless e-appeal system, ensuring transparency and paperless compliance.

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Who Can File an Income Tax Appeal?

An income tax appeal can be filed by:

• Individuals
• Companies
• LLPs
• Partnership firms
• Trusts & NGOs
• Co-operative societies

If the taxpayer believes that the order is incorrect, excessive, or unjustified, an appeal may be filed.

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When Can an Income Tax Appeal Be Filed?

You can file an appeal against:

• Addition of income
• Disallowance of deductions
• Excess tax demand
• Penalty imposed
• Incorrect assessment

⚠️ Appeal must be filed within 30 days from the date of receipt of the order.

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Applicable Form for Income Tax Appeal

• Form 35 is used for filing income tax appeals online

Form 35 is mandatory for appeals before:

• Commissioner of Income Tax (Appeals)
• National Faceless Appeal Centre (NFAC)

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Documents Required for Filing Income Tax Appeal

• Copy of assessment / penalty order
• Notice of demand
• Income Tax Return (ITR)
• Computation of income
• Challan details (tax paid)
• Supporting documents & evidence
• Statement of facts and grounds of appeal

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Step-by-Step Process for Filing Income Tax Appeal (Form 35)

Step 1: Review the Order Carefully

• Identify disputed additions or penalties
• Note the order date and appeal deadline
• Calculate disputed tax amount

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Step 2: Prepare Grounds of Appeal

• Draft clear legal and factual grounds
• Avoid vague or general statements
• Grounds should directly address issues raised

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Step 3: Login to Income Tax Portal

• Login using PAN credentials
• Go to e-File → Income Tax Forms → File Income Tax Forms

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Step 4: Select Form 35

• Choose Form 35 – Appeal to Commissioner (Appeals)
• Select the relevant assessment year

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Step 5: Fill Appeal Details

Enter:

• Order details
• Section under which order passed
• Disputed tax and relief claimed
• Grounds of appeal
• Statement of facts

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Step 6: Upload Supporting Documents

• Assessment order
• Computation
• Evidence and explanations

Ensure documents are clear and relevant.

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Step 7: Pay Appeal Fees

• Pay prescribed appeal fee (based on income)
• Enter challan details in Form 35

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Step 8: Submit & Verify Appeal

• Submit Form 35
• Verify using:
  • Aadhaar OTP
  • Net banking
  • DSC (where applicable)

⚠️ Appeal is invalid without verification.

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Step 9: Respond to Appeal Notices

• Reply to notices issued by NFAC
• Attend virtual hearings if scheduled
• Submit additional clarifications when required

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Step 10: Receive Appeal Order

• Appeal order is issued online
• Relief, confirmation, or modification of demand communicated digitally

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Important Time Limits

• Appeal filing: Within 30 days of order receipt
• Response to notices: As mentioned in portal notice

Delay may lead to dismissal of appeal unless condoned.

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Common Mistakes to Avoid

• Missing appeal deadline
• Weak or generic grounds of appeal
• Non-submission of supporting documents
• Ignoring portal notices
• Filing appeal without tax computation

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Benefits of Filing Income Tax Appeal

• Opportunity to correct unjust additions
• Reduction or deletion of tax demand
• Fair hearing under faceless system
• Protection from coercive recovery
• Legal remedy against errors

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Why Choose Saving Mantra for Income Tax Appeals?

• Expert drafting of grounds & statements
• End-to-end Form 35 filing
• Representation before appellate authorities
• Notice & hearing management
• Strong legal and compliance approach

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Disclaimer

This blog is for informational purposes only and does not constitute legal or tax advice. Income tax appeal procedures and timelines are governed by the Income Tax Act, 1961, and are subject to change. Outcomes depend on case-specific facts and legal interpretation. Saving Mantra recommends consulting a qualified tax professional before filing an income tax appeal.

What Is Transfer Pricing Assessment?

A Transfer Pricing Assessment is a scrutiny process conducted by the Income Tax Department to examine whether international and specified domestic transactions between related parties are conducted at an Arm’s Length Price (ALP) as required under the Income Tax Act, 1961.

During this assessment, the tax authorities evaluate transfer pricing documentation, benchmarking analysis, and transaction pricing to ensure that profits are not shifted out of India through related-party arrangements.

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When Does Transfer Pricing Assessment Arise?

A transfer pricing assessment may arise when:

• An entity enters into international transactions with associated enterprises
• Specified domestic transactions exceed prescribed thresholds
• Income tax return is selected for transfer pricing scrutiny
• Transfer Pricing Officer (TPO) is appointed by the Assessing Officer (AO)

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Who Conducts Transfer Pricing Assessment?

The assessment is carried out by:

• Assessing Officer (AO) – Initiates assessment
• Transfer Pricing Officer (TPO) – Examines ALP and pricing methodology

The TPO issues a separate order determining whether pricing adjustments are required.

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What Transactions Are Examined?

Transfer pricing assessment covers:

• Sale or purchase of goods
• Provision or receipt of services
• Royalty and license fee payments
• Loans, guarantees, and financial transactions
• Cost-sharing and management fee arrangements
• Use or transfer of intellectual property

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Objective of Transfer Pricing Assessment

The key objectives are to:

• Verify compliance with Arm’s Length Principle
• Ensure fair pricing between related parties
• Prevent base erosion and profit shifting
• Determine correct taxable income in India

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Documents Reviewed During Transfer Pricing Assessment

• Transfer pricing study report
• FAR analysis (Functions, Assets, Risks)
• Benchmarking and comparability analysis
• Agreements with associated enterprises
• Invoices and supporting documents
• Financial statements
• Form 3CEB audit report

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Step-by-Step Process of Transfer Pricing Assessment

Step 1: Selection for Scrutiny

• Case selected for transfer pricing scrutiny
• Notice issued under Income Tax Act

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Step 2: Reference to TPO

• AO refers the case to the Transfer Pricing Officer
• TPO initiates independent examination

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Step 3: Issue of Notices

• TPO issues notices seeking:
  • TP documentation
  • Transaction details
  • Benchmarking justification

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Step 4: Submission of Documentation

• Taxpayer submits:
  • TP study report
  • Agreements and invoices
  • Explanatory notes

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Step 5: Comparability & ALP Analysis

• TPO examines:
  • Pricing method used
  • Comparable companies
  • Margin or price adjustments

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Step 6: Draft TP Order

• TPO passes order proposing:
  • No adjustment, or
  • Transfer pricing adjustment

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Step 7: Assessment Order by AO

• AO incorporates TP order
• Final assessment order issued
• Tax demand raised if adjustment made

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Consequences of Transfer Pricing Adjustment

If adjustment is made:

• Increase in taxable income
• Additional tax liability
• Interest and penalties
• Potential litigation and appeals

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Remedies Against Transfer Pricing Adjustment

Taxpayer may:

• File objections before Dispute Resolution Panel (DRP)
• File appeal before Commissioner (Appeals)
• Seek rectification where applicable

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Importance of Strong Transfer Pricing Documentation

Proper documentation:

• Reduces adjustment risk
• Strengthens defense during scrutiny
• Speeds up assessment proceedings
• Minimizes penalties and disputes

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Why Choose Saving Mantra for Transfer Pricing Assessment Support?

• Expert handling of TP scrutiny cases
• Robust documentation and benchmarking
• Representation before TPO and AO
• Adjustment mitigation strategies
• End-to-end compliance and litigation support

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Disclaimer

This blog is for informational purposes only and does not constitute legal, tax, or professional advice. Transfer pricing assessment procedures are complex and subject to frequent amendments. Applicability depends on transaction nature, value, and jurisdiction. Saving Mantra recommends consulting a qualified transfer pricing or tax professional before responding to assessment notices.

What Is Transfer Pricing Audit?

A Transfer Pricing Audit is an income tax compliance review conducted to verify whether international and specified domestic transactions between related parties are carried out at an Arm’s Length Price (ALP), as required under the Income Tax Act, 1961.

The objective of a transfer pricing audit is to ensure that profits are not shifted outside India by manipulating prices in transactions between associated enterprises (AEs).

In India, transfer pricing provisions are administered by the Income Tax Department.

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Who Is Required to Comply with Transfer Pricing Provisions?

Transfer pricing provisions apply to:

• Indian companies dealing with foreign group entities
• Indian entities having international transactions
• Entities with specified domestic transactions exceeding prescribed limits
• Multinational enterprises (MNEs)
• Indian subsidiaries of foreign companies

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What Are International Transactions?

International transactions include:

• Purchase or sale of goods
• Provision or receipt of services
• Payment of royalties or fees
• Transfer of intellectual property
• Loan, guarantee, or financing arrangements
• Cost-sharing arrangements

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What Is the Purpose of Transfer Pricing Audit?

The audit ensures that:

• Prices charged between related parties are fair
• Transactions follow the Arm’s Length Principle
• Taxable income is correctly reported in India
• Global profits are not artificially shifted

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Key Transfer Pricing Compliance Requirements

Entities covered under transfer pricing must comply with:

• Maintenance of transfer pricing documentation
• Filing Form 3CEB (CA-certified report)
• Submission of Local File and Master File
• Filing Country-by-Country Report (CbCR), where applicable

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When Is Transfer Pricing Audit Mandatory?

A transfer pricing audit becomes mandatory when:

• International transactions exist with associated enterprises
• Specified domestic transactions exceed statutory thresholds
• Entity is selected for transfer pricing scrutiny

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Documents Required for Transfer Pricing Audit

• Details of associated enterprises
• Nature and value of transactions
• Transfer pricing study report
• FAR analysis (Functions, Assets, Risks)
• Benchmarking analysis
• Financial statements
• Agreements and invoices
• Form 3CEB

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Role of Form 3CEB in Transfer Pricing Audit

Form 3CEB is a mandatory audit report:

• Certified by a Chartered Accountant
• Filed electronically
• Confirms compliance with transfer pricing provisions

Without Form 3CEB, the income tax return is treated as defective.

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Consequences of Non-Compliance

Failure to comply with transfer pricing provisions may result in:

• Adjustment to taxable income
• Additional tax demand
• Penalty up to 2% of transaction value
• Interest and litigation
• Prolonged scrutiny and assessments

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Benefits of Proper Transfer Pricing Audit

• Reduced risk of tax disputes
• Strong compliance framework
• Accurate global profit allocation
• Improved credibility with tax authorities
• Smooth assessments and audits

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Why Transfer Pricing Is Critical for MNCs

• Cross-border transactions attract close scrutiny
• Regulatory expectations are high
• Documentation standards are strict
• Penalties are significant

Proactive compliance avoids costly disputes.

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Why Choose Saving Mantra for Transfer Pricing Audit?

• Expert CA-led transfer pricing audits
• End-to-end documentation support
• Benchmarking & FAR analysis
• Form 3CEB filing assistance
• Representation during assessments

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Disclaimer

This blog is intended for informational purposes only and does not constitute legal, tax, or professional advice. Transfer pricing regulations are complex and subject to amendments. Applicability depends on transaction nature, value, and jurisdiction. Saving Mantra recommends consulting a qualified tax or transfer pricing professional before making compliance decisions.

What Is an Updated Return (ITR-U)?

An Updated Return, filed using ITR-U, allows taxpayers to voluntarily correct or update their income tax return after the original, belated, or revised return deadline has passed.
This facility was introduced by the Income Tax Department under Section 139(8A) of the Income Tax Act, 1961.

ITR-U helps taxpayers disclose missed income, correct errors, and regularize past non-compliance while avoiding heavy penalties and litigation.

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Who Can File an Updated Return?

You can file an Updated Return if you:

• Missed filing the original ITR
• Reported incorrect income
• Selected the wrong ITR form
• Missed declaring interest, salary, or other income
• Want to reduce the risk of notices

⚠️ Updated Return can be filed only to increase tax liability, not to reduce it.

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Who Cannot File ITR-U?

ITR-U cannot be filed if:

• It results in a refund or increases refund amount
• It reduces tax liability
• Assessment, search, or survey proceedings are initiated
• Information is received under international agreements
• Prosecution proceedings have started

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Time Limit for Filing Updated Return

• Within 24 months from the end of the relevant assessment year

Example:
For AY 2022-23, ITR-U can be filed up to 31 March 2025.

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Additional Tax Payable on ITR-U

• 25% of tax + interest → If filed within 12 months
• 50% of tax + interest → If filed after 12 months but within 24 months

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Documents Required for Filing Updated Return

• PAN & Aadhaar
• Original / Belated / Revised ITR (if filed earlier)
• Income details missed earlier
• Bank statements
• Form 16 / Form 26AS / AIS
• Challan details of tax paid

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Step-by-Step Process for Filing Updated Return (ITR-U)

Step 1: Identify the Reason for Update

• Income missed
• Wrong income head
• Incorrect deductions
• Non-filing earlier

Select the correct reason code while filing ITR-U.

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Step 2: Compute Revised Income

• Recalculate total income
• Compute additional tax and interest
• Add applicable 25% or 50% additional tax

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Step 3: Pay Due Tax

• Pay total tax liability using challan
• Keep challan details ready

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Step 4: Login to Income Tax Portal

• Login using PAN
• Go to e-File → Income Tax Returns → File Updated Return

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Step 5: Select Relevant ITR Form

• ITR-1 / ITR-2 / ITR-3 / ITR-4 / ITR-5 / ITR-6 / ITR-7
• Select ITR-U along with applicable return

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Step 6: Fill Updated Return Details

Enter:

• Updated income figures
• Tax paid details
• Reason for filing ITR-U

Ensure data matches AIS and Form 26AS.

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Step 7: Validate and Submit

• Validate all fields
• Submit the Updated Return

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Step 8: Verify the Return

• Aadhaar OTP
• Net banking
• DSC (where applicable)

⚠️ ITR-U is invalid without verification.

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Important Points to Remember

• ITR-U can be filed only once for an assessment year
• It always results in additional tax payment
• Filing early reduces penalty impact
• Accurate disclosure avoids future scrutiny

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Benefits of Filing Updated Return

• Avoid income tax notices
• Regularize non-compliance
• Peace of mind
• Clean tax records
• Reduced litigation risk

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Why Choose Saving Mantra for Updated Return Filing?

• Expert review of past returns
• Accurate tax recomputation
• End-to-end ITR-U filing
• AIS & notice-prevention checks
• Complete digital support

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Disclaimer

This blog is for informational purposes only and does not constitute legal or tax advice. Provisions relating to Updated Return (ITR-U) under Section 139(8A) are subject to change and depend on individual facts and circumstances. Saving Mantra recommends consulting a qualified tax professional before filing an updated return.

What Is Expatriate Taxation?

Expatriate Taxation refers to the income tax rules and compliance requirements applicable to individuals working, living, or earning income outside their home country. In the Indian context, it mainly applies to:

• Foreign nationals working in India
• Indians working abroad (NRIs / PIOs / OCIs)
• Employees on international assignments

Taxation of expatriates in India is governed by the Income Tax Department under the Income Tax Act, 1961, and depends largely on the residential status of the individual.

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Who Is Considered an Expatriate?

An expatriate (expat) is a person who:

• Lives outside their country of citizenship temporarily or permanently
• Works in a foreign country on employment, business, or assignment

In India, expatriates include:

• Foreign employees working in India
• Indian citizens employed overseas
• Professionals on short-term or long-term foreign assignments

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Importance of Residential Status in Expatriate Taxation

Residential status is the foundation of expatriate taxation in India. It determines:

• Scope of taxable income
• Reporting requirements
• Availability of tax exemptions

Residential Status Categories

• Resident and Ordinarily Resident (ROR)
• Resident but Not Ordinarily Resident (RNOR)
• Non-Resident Indian (NRI)

Taxability varies significantly across these categories.

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Scope of Taxable Income for Expatriates

Residential Status	Taxable Income in India
ROR	Global income taxable
RNOR	Income received in India + income from India
NRI	Income received or accrued in India only

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Common Income Sources for Expatriates

• Salary for services rendered in India
• Overseas salary (depending on residential status)
• Rental income from property in India
• Capital gains on Indian assets
• Interest from Indian bank accounts
• Stock options (ESOPs)

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Taxation of Salary Income for Expatriates

• Salary earned for services rendered in India is taxable in India
• Salary received outside India may still be taxable based on residency
• Perquisites such as housing, relocation allowance, and tax equalization may be taxable

Double taxation relief may apply.

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Double Taxation Avoidance Agreement (DTAA)

India has DTAA treaties with several countries to prevent double taxation of the same income.

Benefits include:

• Lower tax rates
• Tax credit for foreign taxes paid
• Income exemption in certain cases

DTAA relief can be claimed by submitting:

• Tax Residency Certificate (TRC)
• Form 10F

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Income Tax Return Filing for Expatriates

Expatriates must file income tax returns in India if:

• Taxable income exceeds basic exemption limit
• Claiming refund of excess TDS
• Holding Indian assets or investments

Applicable ITR forms:

• ITR-2 – Salary, foreign income, capital gains
• ITR-3 – Business or professional income

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Key Compliance Requirements for Expatriates

• PAN and Aadhaar (if applicable)
• Disclosure of foreign assets (Schedule FA)
• Reporting foreign bank accounts
• Advance tax compliance
• DTAA documentation

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Common Expatriate Tax Challenges

• Incorrect residential status determination
• Double taxation of income
• Non-disclosure of foreign assets
• Incorrect TDS deduction by employer
• Missing DTAA benefits

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Why Expatriate Tax Planning Is Important

• Avoid excess tax payments
• Ensure global compliance
• Reduce litigation and notices
• Optimize DTAA benefits
• Maintain clean financial records

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Why Choose Saving Mantra for Expatriate Taxation?

• Expert handling of NRI & expat taxation
• Residential status evaluation
• DTAA advisory & tax credit claims
• ITR filing with foreign income disclosure
• End-to-end compliance support

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Disclaimer

This blog is for informational purposes only and does not constitute legal, tax, or financial advice. Expatriate taxation laws are complex and subject to change based on residential status, income type, and international treaties. Saving Mantra recommends consulting a qualified tax professional before making tax-related decisions.

What Are E-Assessments & E-Appeals?

E-Assessments and E-Appeals are digital, faceless proceedings introduced by the Income Tax Department to make income tax compliance transparent, paperless, and time-bound.

Under this system:

• All notices, submissions, hearings, and orders are conducted online
• There is no physical interaction between taxpayer and tax officer
• Communication happens only through the Income Tax e-Filing Portal

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What Is E-Assessment?

E-Assessment (also called Faceless Assessment) is the process where the Income Tax Department examines:

• Filed Income Tax Return (ITR)
• Discrepancies in income, deductions, or disclosures
• Information mismatch with AIS / TDS / third-party data

The entire assessment is handled digitally through notices and responses uploaded online.

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What Is E-Appeal?

An E-Appeal is filed when a taxpayer disagrees with an assessment order, penalty order, or rectification order passed by the department.

E-Appeals are filed online before:

• Commissioner of Income Tax (Appeals)
• National Faceless Appeal Centre (NFAC)

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Benefits of E-Assessments & E-Appeals

• 100% online & paperless
• No physical visits or hearings
• Transparent and traceable communication
• Reduced litigation bias
• Faster disposal of cases

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When Can You Receive an E-Assessment Notice?

You may receive an e-assessment notice if:

• Income mismatch with AIS or Form 26AS
• High-value transactions detected
• Excess deductions or exemptions claimed
• Return selected for scrutiny
• Defective or incomplete ITR filed

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Documents Required for E-Assessment & E-Appeal

• Income Tax Return copy
• Notice/order received
• Financial statements
• Bank statements
• Investment proofs
• Agreements, invoices, bills
• Computation of income
• Supporting legal explanations

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Step-by-Step Process for E-Assessment

Step 1: Receive Notice

• Notice is received via email & e-filing portal
• Check section, due date, and response requirement

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Step 2: Login to Income Tax Portal

• Login using PAN
• Go to e-Proceedings / Pending Actions

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Step 3: Download & Review Notice

• Understand the issue raised
• Identify documents and explanations required

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Step 4: Prepare Response

• Draft clear explanations
• Attach supporting documents
• Ensure consistency with ITR and books

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Step 5: Submit Reply Online

• Upload response before due date
• Submit through the portal

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Step 6: Attend Virtual Hearing (If Required)

• Some cases require video conferencing
• Attend through portal link

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Step 7: Receive Assessment Order

• Final order issued electronically
• Tax demand or relief communicated online

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Step-by-Step Process for Filing E-Appeal

Step 1: Review Assessment Order

• Check grounds of disagreement
• Calculate disputed tax amount

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Step 2: Prepare Appeal Grounds

• Legal and factual arguments
• Supporting evidence and case laws

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Step 3: Login to Income Tax Portal

• Select e-File → Income Tax Forms → Form 35

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Step 4: Fill Form 35 (E-Appeal)

Enter:

• Order details
• Grounds of appeal
• Statement of facts
• Relief claimed

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Step 5: Upload Supporting Documents

• Assessment order
• Computation
• Evidence documents

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Step 6: Submit & Verify Appeal

• Submit Form 35
• Verify using EVC or DSC

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Step 7: Online Hearing & Order

• Respond to appeal notices
• Attend virtual hearings
• Receive appeal order digitally

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Important Time Limits

• E-Assessment response: As mentioned in notice
• E-Appeal filing: Within 30 days from receipt of order

Delay may lead to dismissal of appeal.

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Common Mistakes to Avoid

• Missing response deadlines
• Uploading incomplete documents
• Contradicting earlier submissions
• Filing appeal without legal grounds
• Ignoring portal notifications

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Why Choose Saving Mantra for E-Assessments & E-Appeals?

• Expert handling of scrutiny cases
• Professionally drafted replies & appeals
• End-to-end portal management
• Legal & compliance-oriented approach
• Notice resolution support

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Disclaimer

This blog is for informational purposes only and does not constitute legal or tax advice. Income tax laws and procedures relating to e-assessments and e-appeals are subject to change and depend on individual case facts. Saving Mantra recommends consulting a qualified tax professional before responding to notices or filing appeals.

What Is Income Tax Filing for an LLP?

A Limited Liability Partnership (LLP) is treated as a separate legal and taxable entity under the Income Tax Act, 1961. Every LLP registered in India is required to file an Income Tax Return (ITR) every year, regardless of whether it has earned profit, incurred loss, or carried out business activities.

Income tax for an LLP is calculated on its net taxable profit, after allowing eligible business expenses, deductions, and partner remunerations as per the LLP Agreement.

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Is Income Tax Filing Mandatory for LLP?

Yes. Income tax filing is mandatory for all LLPs, including:

• Active LLPs
• Dormant LLPs
• LLPs with no income
• Loss-making LLPs

Non-filing may result in penalties, interest, and scrutiny notices from the Income Tax Department.

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Tax Rate Applicable to LLP

• Flat Income Tax Rate: 30%
• Surcharge: Applicable if income exceeds prescribed limits
• Health & Education Cess: 4% on total tax

⚠️ LLPs do not get any basic exemption limit.

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Which ITR Form Is Applicable for LLP?

• ITR-5 is mandatory for LLP income tax filing

ITR-5 applies whether the LLP is:

• Under audit
• Not under audit
• Having profit or loss

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Documents Required for LLP Income Tax Filing

• PAN of the LLP
• LLP Agreement
• Financial statements (Profit & Loss Account, Balance Sheet)
• Bank statements
• Partner remuneration & interest details
• TDS details (Form 26AS)
• Audit report (if applicable)

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Step-by-Step Process for Filing Income Tax – LLP

Step 1: Prepare Financial Statements

Prepare:

• Profit & Loss Account
• Balance Sheet

Ensure:

• Partner remuneration and interest are as per LLP Agreement
• All expenses are properly supported

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Step 2: Check Tax Audit Applicability

Tax audit is mandatory if:

• Turnover exceeds ₹1 crore (business)
• ₹50 lakh (profession)

Higher limits may apply if digital transactions exceed prescribed thresholds.

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Step 3: Compute Taxable Income

• Start with net profit as per P&L
• Add disallowed expenses
• Deduct allowable expenses
• Deduct partner remuneration & interest within limits

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Step 4: Login to Income Tax Portal

• Login using LLP PAN
• Select “File Income Tax Return”
• Choose the relevant Assessment Year

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Step 5: Fill ITR-5 Details

Enter:

• LLP details
• Partner details
• Business income
• Balance Sheet and P&L figures
• Tax computation

Accuracy is essential to avoid notices.

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Step 6: Pay Tax (If Applicable)

• Pay advance tax or self-assessment tax
• Enter challan details

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Step 7: Submit Income Tax Return

• Validate all details
• Submit ITR-5 online

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Step 8: Verify the Return

• Verify using Digital Signature Certificate (DSC) or EVC

⚠️ ITR is treated as invalid if not verified.

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Important Due Dates for LLP Income Tax Filing

• 31st July – LLP not liable for audit
• 31st October – LLP liable for tax audit

(Dates may be extended by government notifications.)

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Common Mistakes to Avoid

• Filing incorrect ITR form
• Incorrect partner remuneration calculation
• Missing audit applicability
• Late filing of return
• Forgetting to verify ITR

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Benefits of Filing LLP Income Tax Return

• Statutory compliance
• Carry forward business losses
• Smooth loan and funding approvals
• Avoid penalties and interest
• Strong financial credibility

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Why Choose Saving Mantra for LLP Income Tax Filing?

• CA-assisted ITR-5 filing
• Accurate tax computation
• Audit and non-audit support
• Error-free compliance
• Complete digital process

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Disclaimer

This blog is for informational purposes only and does not constitute legal, financial, or tax advice. Income tax laws applicable to LLPs are subject to change and depend on individual business circumstances. Saving Mantra recommends consulting a qualified tax professional before filing income tax returns.

Income Tax Filing for Co-operative Society – Step-by-Step

What Is Income Tax for a Co-operative Society?

A Co-operative Society is an entity registered under the Co-operative Societies Act and treated as a separate taxable person under the Income Tax Act, 1961. Every co-operative society is required to file an Income Tax Return (ITR) annually, irrespective of profit or loss.

Income tax is calculated on the net taxable income of the society after allowing eligible deductions, exemptions, and expenses as per law.

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Is Income Tax Filing Mandatory for Co-operative Societies?

Yes, income tax return filing is mandatory for:

• Credit co-operative societies
• Housing co-operative societies
• Consumer co-operative societies
• Agricultural and non-agricultural co-operative societies

Even if:

• There is no taxable income
• Income is exempt or eligible for deductions

Non-filing can result in penalties, interest, and loss of deduction benefits.

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Tax Rate Applicable to Co-operative Societies

• Up to ₹10,000 – 10%
• ₹10,001 to ₹20,000 – 20%
• Above ₹20,000 – 30%
• Health & Education Cess – 4%

(Some co-operative societies may opt for concessional tax regimes, subject to conditions.)

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Applicable ITR Form for Co-operative Society

• ITR-5 is mandatory for all co-operative societies

ITR-5 applies whether the society is:

• Profitable
• Loss-making
• Under audit

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Documents Required for Filing Income Tax – Co-operative Society

• PAN of the co-operative society
• Registration certificate
• Bye-laws of the society
• Financial statements (P&L, Balance Sheet)
• Audit report (if applicable)
• Bank statements
• TDS details (Form 26AS)
• Details of deductions claimed

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Step-by-Step Process for Filing Income Tax – Co-operative Society

Step 1: Prepare Financial Statements

Prepare:

• Profit & Loss Account
• Balance Sheet

Ensure:

• Income and expenses are properly classified
• Member-related transactions are clearly recorded

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Step 2: Check Tax Audit Applicability

Tax audit is mandatory if:

• Turnover exceeds prescribed limits
• Audit is required under the Co-operative Societies Act

Audit report must be completed before filing ITR.

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Step 3: Compute Taxable Income

• Start with net surplus as per P&L
• Add disallowed expenses
• Deduct eligible deductions (e.g., Section 80P, if applicable)
• Arrive at taxable income

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Step 4: Login to Income Tax Portal

• Login using society’s PAN
• Select “File Income Tax Return”
• Choose the relevant Assessment Year

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Step 5: Fill ITR-5 Details

Enter:

• Society details
• Nature of activities
• Income details
• Balance sheet & P&L figures
• Tax computation

Accuracy is crucial to avoid scrutiny.

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Step 6: Pay Tax (If Applicable)

• Pay advance tax or self-assessment tax
• Enter challan details in the return

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Step 7: Submit Income Tax Return

• Validate all entries
• Submit ITR-5 online

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Step 8: Verify the ITR

• Verify using Digital Signature Certificate (DSC) or EVC

⚠️ Return is invalid without verification.

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Important Due Dates for Co-operative Society ITR

• 31st July – Non-audit cases
• 31st October – Audit cases

(Due dates may change as per government notifications.)

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Common Mistakes to Avoid

• Filing incorrect ITR form
• Missing Section 80P deduction eligibility
• Mismatch with audit report or Form 26AS
• Late filing leading to penalties
• Not verifying the return

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Benefits of Filing Income Tax Return for Co-operative Society

• Statutory compliance
• Claim eligible deductions and exemptions
• Carry forward losses
• Better credibility with banks & regulators
• Avoid penalties and legal notices

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Why Choose Saving Mantra for Co-operative Society ITR Filing?

• Expert CA-assisted filing
• Accurate Section 80P deduction handling
• Audit and non-audit support
• Error-free ITR-5 preparation
• End-to-end compliance management

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Disclaimer

This blog is for informational purposes only and does not constitute legal or tax advice. Income tax provisions applicable to co-operative societies are subject to amendments and depend on individual circumstances. Saving Mantra recommends consulting a qualified tax professional before filing income tax returns.

What Is Income Tax for a Trust?

In India, charitable and religious trusts are required to file an Income Tax Return (ITR) every year to claim tax exemptions under the Income Tax Act, 1961. Trusts registered under Section 12A/12AB and approved under Section 80G must comply with specific income application and audit requirements.

If a trust’s income exceeds the basic exemption limit, it must also undergo an audit and file Form 10B, which is a mandatory audit report certified by a Chartered Accountant.

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Types of Trusts Required to File Income Tax Return

Income tax filing applies to:

• Charitable trusts
• Religious trusts
• Educational trusts
• Medical trusts
• NGOs and non-profit organizations

Both registered and provisionally registered trusts must file returns.

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Applicable ITR Form for Trust

• ITR-7 is mandatory for:
  • Trusts
  • NGOs
  • Institutions claiming exemption under Sections 11, 12, 10(23C)

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What Is Form 10B Audit?

Form 10B is an audit report required to be filed online when:

• Total income of the trust exceeds the basic exemption limit
• Trust claims exemption under Sections 11 & 12

The form must be:

• Prepared and certified by a Chartered Accountant
• Filed before filing ITR-7

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Due Dates for Trust Return & Form 10B

• Form 10B: On or before the due date of ITR filing
• ITR-7 (Audit cases): 31st October
• ITR-7 (Non-audit cases): 31st July

(Due dates are subject to extension by the government.)

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Documents Required for Trust ITR & Form 10B

• PAN of the trust
• Trust deed
• Registration certificate (12A/12AB)
• 80G approval (if applicable)
• Financial statements (P&L, Balance Sheet, Receipts & Payments)
• Details of income application
• Bank statements
• Audit report (Form 10B)
• Digital Signature Certificate (DSC)

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Step-by-Step Process for Filing Income Tax – Trust Return & Form 10B

Step 1: Prepare Trust Accounts

Prepare:

• Income & Expenditure Account
• Balance Sheet
• Receipts & Payments Account

Ensure:

• At least 85% of income is applied toward charitable purposes
• Any accumulation is properly documented

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Step 2: Check Audit Applicability

Audit under Form 10B is mandatory if:

• Trust income exceeds exemption limit
• Exemption under Sections 11 & 12 is claimed

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Step 3: Appoint Chartered Accountant

• Appoint a CA for audit
• Assign CA on the income tax portal

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Step 4: CA Prepares & Files Form 10B

• CA audits trust accounts
• Fills Form 10B online
• Digitally signs using DSC
• Submits Form 10B on the portal

⚠️ Form 10B must be filed before ITR-7

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Step 5: Compute Taxable Income

• Calculate total income
• Verify application of income
• Adjust disallowed expenses
• Compute surplus, if any

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Step 6: File ITR-7 Online

• Login to income tax portal
• Select ITR-7
• Enter trust details, income & exemption data
• Validate audit details

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Step 7: Pay Tax (If Applicable)

• Pay self-assessment tax (if any)
• Enter challan details

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Step 8: Submit & Verify ITR

• Submit ITR-7
• Verify using:
  • DSC
  • EVC

ITR is invalid without verification.

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Common Mistakes to Avoid

• Filing ITR-7 without Form 10B
• Incorrect income application calculation
• Late filing of audit report
• Mismatch between audit report & return
• Missing registration details

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Benefits of Proper Trust Compliance

• Retain tax-exempt status
• Avoid cancellation of registration
• Smooth grant & funding approvals
• Transparent financial records
• Protection from penalties & notices

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Why Choose Saving Mantra for Trust ITR & Audit?

• CA-assisted Form 10B audit
• Accurate ITR-7 filing
• Compliance with 12AB & 80G norms
• End-to-end digital handling
• Notice & scrutiny support

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Disclaimer

This blog is for informational purposes only and does not constitute legal, financial, or tax advice. Income tax provisions applicable to trusts are subject to amendments and depend on individual circumstances. Saving Mantra recommends consulting a qualified Chartered Accountant or tax professional before filing trust returns or Form 10B audit.