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Saral form is not meant for non-taxable income

A senior citizen aged 80 years has income from pension, rental income and some interest on deposits. His total income falls well below Rs. 1.85 lakh. He wants to know that, if his income exceeds Rs. 1 lakh, which is the minimum exemption limit, whether he is required to file a voluntary return in Saral form or face penalty of Rs. 5,000 for not having filed such return.

Sec. 271F does provide a penalty of Rs. 5,000 only for those, who are required to file return under Sec. 139(1), but did not do so even by the end of the financial year. Persons without having taxable income, satisfying anyone of six criteria of comfortable living, had to file return, but there is no such requirement any longer to file such voluntary return with effect from assessment year 2005-06. Though a firm or a company and some of the exempted institutions are required to file return voluntarily, even if they have no tax to pay, it is not necessary for all others to file returns, unless their income exceeds "maximum amount which is not chargeable to income tax".

In the case of senior citizens, such limit is Rs. 1.85 lakh, so that the advice received by the reader is incorrect.

Even Saral Form is applicable only for those with taxable income.

S. Rajaratnam

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