What is ITR-5 Form and How to File ITR-5?
Filing an income tax return is mandatory for all taxpayers. The tax collected by the Government provides the foundation for much information like capita income or the amount of money earned in a country per person, sector-wise growth and so on. ITR 5 form is an Income Tax Return form to be used specifically by firms, judicial persons, co-operative societies, local authorities, etc. This article discusses the ITR-5 form, eligibility and how to file for a return. Read on!
What is ITR-5 Form?
ITR-5 form is an Income Tax Return form best suited for a specific category of taxpayers like firms, Body of Individuals (BOI), Limited Liability Partnerships (LLPs), etc. Based on this information, one must file ITR before the deadline mentioned by the Income Tax department.
Who is Eligible to File ITR-5?
The following categories of taxpayers can file the ITR-5 form:
- Limited Liability Partnerships (LLPs)
- Association of Persons (AOPs)
- Body of Individuals (BOI)
- Estate of deceased
- Estate of insolvent
- Business trust is referred to in the Income Tax Act Section 139(4E)
- The investment fund referred to in the Income Tax Act Section 139(4F)
- Firm
- Co-operative Society
- Society registered under the Societies Registration Act of 1860 or any other State law
- Local Authority referred to in clause (vi) of Income-tax Act Section 2(31)
- Artificial Judicial Persons referred to in clause (vii) of Income-tax Act Section 2(31)
- Representative Assessee as defined in Section 160(1)(iii) (iv)
Individuals who fall under the above categories are eligible to file the ITR-5 form.
Who is Not Eligible to File Form ITR-5?
Taxpayers required to file Form ITR-7 tax returns under Sections 139(4A), 139(4B), 139(4C), and 139(4D) (4D) are not eligible to file the ITR-5 Income Tax Return form.
How to File ITR-5?
ITR-5 can be filed in both online and offline mode. In offline mode, it can be filed by submitting the return on paper or by submitting the bar-coded return. While filing a return, completing the acknowledgement slips and return form is crucial. However, filing ITR-5 online is comparatively easier; it can be filed by electronically signing the return or transmitting data in the return.
ITR-5 Form can be filed with the Income Tax Department electronically via the Income Tax Department’s e-filing web portal. Enter all relevant information and check that the information provided is correct, and get verified. Verification can be done in any of the following ways:
- Digitally signing the verification section,
- Authenticating via electronic verification code (EVC),
- Aadhaar OTP
- Mailing a duly signed Form ITR V – Income Tax Return Verification Form to CPC at the address “Centralised Processing Centre, Income Tax Department, Bengaluru— 560500, Karnataka.”
However, for individuals who are required to provide an audit report under Sections 10AA, 44AB, 44DA, 50B, 80IA, 80IB, 80IC, 80ID, 80JJAA, 80LA (1), 80LA (1A), 92E, 115JB, or 115JC, the return must be verified electronically using a digital signature on or before the due date to file returns.
How to Fill Out the Verification Document?
Mention all necessary details in the verification document, get the return verification form properly attested and mention the name of the person who signed or attested the return. If the return verification form is provided in the manner specified by the Income Tax Department, it should be printed and duly signed by the individual. The copy then must be mailed to,
Centralised Processing Centre
Income Tax Department,
Bengaluru- 560500, (Karnataka).
The Form ITR V (Income Tax Return Verification Form) should be mailed to the Centralised Processing Centre within 120 days (about 4 months) of the date of the return of the e-file. The confirmation of the receipt of ITR V at the Centralised Processing Centre will be sent via the email ID registered in the e-filing account.
Structure of ITR-5 Form
The form is divided into two sections, each with its significance.
Part 1- Information about the taxpayer and their earnings
- General Information about the taxpayer’s personal information, including the date of incorporation. It also includes information about the key personnel in the organisation, shareholders and the organisation’s status under Section 44AB for Tax Audit, and so on.
- The balance sheet for the year you are filing provides an outlook on the assets and liabilities of the entity.
- It contains a section where the individual has to provide information about the entity’s earnings and expenses, allowing the person to calculate the profit and loss earned during the relevant year.
- It also contains the section where the taxpayer’s accounting method and estimates are disclosed. The various disallowances under various sections of the Income Tax Act are also disclosed in this section
Part 2 consists of two parts
- Part 2-TI: Calculation of total income.
- Part 2-TTI: Calculation of tax to be paid on total income.
Tax payment
Advance tax and self-assessment tax information and information on tax deducted at source (TDS) and tax collected at source (TCS) are provided in this section.
Verification
After filling in all the above information, the return must be submitted and verified. There are two methods for verifying the ITR. You can either submit the return electronically or mail the ITR V to the Centralised Processing Centre within 120 days of submitting the return.
According to the Income Tax Department, the best order for filing ITR is:
- Part A
- All the schedules
- Part B
- Verification
Instructions to be Followed While Filing ITR-5 Form
Mentioned below are a few other instructions that should be followed while filing ITR 5 – Income tax return form:
- If a schedule mentioned in the form is not applicable, mark “–NA–”.
- If any item is inappropriate or is not applicable, indicate it with “NA”.
- “Nil” denotes nil figures. To represent figures with zero value, use Nil.
- If any negative figure or loss is not provided in the form, write “-” before it.
- Every numeric figure should be rounded off to the nearest rupee.
- Total income/loss and tax payable figures should be rounded to the nearest multiple of ten rupees.
- ITR-5 does not require any documents to be attached when submitting it online or offline.
- One should always be careful and double-check all details; any individual who makes a false/wrong statement in return or the related schedules is liable under Section 277 of the Income-tax Act, 1961, and is punishable under the section with imprisonment and fine after the court’s decision.
Final Word
Understanding how the ITR-5 Form works could be beneficial to the organisation and its stakeholders as it helps them to study the performance of their entities thoroughly and analytically. It is crucial to analyse every element or section of the ITR form applicable for the relevant fiscal year, allowing transparency of data as well as disallowances, allowances, or deductions under the Income Tax Act.
FAQs on ITR-5 Form
Ans: When filing an income tax return online via the income tax e-filing website, the return must be verified either by submitting an ITR-V form to the Income Tax Central Processing Centre (CPC) or by using EVC Mode.
Ans: A person who is a firm, LLP, a BOI, a AOP, or an artificial juridical person referred to in section 2(31)(vii), the estate of deceased, the estate of insolvent, business trust and investment fund, cooperative society, and local authority can use this form.
Ans: After you have filed your IT returns and verified them, the average time for receiving your income tax refund is 20-45 days (about 1 and a half months) after the ITR has been processed. If it takes longer than expected, you should contact the Centralised Processing Centre (CPC). Online tracking of income tax refunds is possible.
Ans: If you do not submit your ITR-V within 120 days (about 4 months) of filing your Income Tax Return, it will be considered invalid. It means that the Income Tax Department will consider you to have failed to file your IT return.
Ans: All taxpayers’ income tax returns are first processed online at the Centralised Processing Centre (CPC). Following the processing of the return, the income tax department notifies the taxpayers of the results under section 143(1).
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This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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