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Anil Rego | Answer |Ask -Follow

Financial Planner - Answered on Feb 07, 2022

Anil Rego is the founder of Right Horizons, a financial and wealth management firm. He has 20 years of experience in the field of personal finance.
He’s an expert in income tax and wealth management.
He has completed his CFA/MBA from the ICFAI Business School.... more

Question by Sarvotham on Feb 07, 2022Hindi

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I was working in a private firm up to March 2021 and got retired. At present I am working in the same firm as an advisor for 1 year. Can I declare my income as Business income or Income from Service provided? Is there any requirement of Service Tax registration? Which ITR form to be used?

Ans: It depends on how the company is compensating you. If it is continuing to pay you salary, and provides you a Form 16, then you need to continue as salaried income.

It is likely that they are having you as a consultant and will give you Form 16A. In such case it will be treated as income from business or profession.

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.

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I retired from Railway in June 2022 and received below amount on retirement. PF-23 Lakh, Gratuity - 12 lakh, Commutation - 13 lakh and Leave encashment - 9 lakh. I also received pension from July 2022 to March 2023 - 259,000 INR. There was no TDS on salary of 3 months. Do I need to show all of the amounts in Income tax return? If yes what is exempt income and how to show all above?

Ans: You need to declare all the income, but some are taxable and some are not
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Asked by Anonymous - Jul 20, 2023Hindi

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Dear Mr. Mihir, I was working for a private company and retired on superannuation in November 2022. Thereafter, I was engaged by the company as a consultant to complete some pending project. Therefore during the financial year 2022-23, I have salary income from the company and also some amount the company paid to me for professional services for my consultant services after retirement. Which ITR form should I use, ITR-2 or ITR-3? Regards

Ans: After retirement you were working on as profession on full time basis, thus, it will be chargeable under the head Income from Business and profession. If your profession is covered by list of profession mentioned in 44AA and gross receipt from profession is less than 50 lacs, you can opt for presumptive taxation and take 50% deduction. If presumptive taxation is opted, you can file ITR 4 else ITR 3 is applicable.

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Question by BD - Jul 20, 2023Hindi

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Dear Mr. Mihir, I was working for a private company and retired on superannuation in November 2022. Thereafter, I was engaged by the company as a consultant to complete some pending project. Therefore during the financial year 2022-23, I have salary income from the company and also some amount the company paid to me for professional services for my consultant role after retirement. Which ITR form should I use, ITR-2 or ITR-3? I have income from salary and also from professional service. Regards

Ans: After retirement you were working on as profession on full time basis, thus, it will be chargeable under the head Income from Business and profession. If your profession is covered by list of profession mentioned in 44AA and gross receipt from profession is less than 50 lacs, you can opt for presumptive taxation and take 50% deduction. If presumptive taxation is opted, you can file ITR 4 else ITR 3 is applicable.

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Question by Ravi - Feb 05, 2024Hindi

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Hello Samkit, I have retired from Govt. PSU service during Oct.2022 and had filed my ITR (Form 1) for FY 2022-23. For FY 2023-24, will there be any change in filing of returns or do I file in Form 1 itself which includes present employer salary, FD / SB interest and dividends. Secondly, from the buyback of shares by a company, which I am holding, the profit (purchase price less buyback price after brokerage, if any), do I need to account through Form 1 itself or do I need to change to other form in which this profit, present employer salary, FD / SB interest and dividends to be accounted. Kindly advice. Ravi Shankar

Ans: You may continue in the form 1 itself. You need to show the buyback amount under the head exempt income in the form.

Please take assistance of your CA on this.

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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