Browse 35 essential itr filing terms and definitions used by professionals in India.
Term Index
Every term and its definition, all on this page.
Advance Tax is income tax paid in instalments during the financial year instead of after year-end. Salaried taxpayers with tax already withheld may owe little or none, while businesses, professionals, and others with higher expected tax liability usually must pay it on time.
Annual Information Statement is a tax information summary issued by the Income Tax Department in India. It shows reported income, tax payments, interest, dividends, securities transactions, and other financial data used to check and prefill income tax returns.
Assessment Year is the 12-month period after a financial year in which income earned is assessed and taxed under Indian income tax law. Taxpayers usually file returns for the financial year while the return is processed, reviewed, and taxed in the following assessment year.
Capital Gains are the profit earned when a capital asset such as property, shares, or mutual funds is sold for more than its purchase cost. In India, tax treatment depends on the asset type and the holding period, which can make the gain short-term or long-term.
Carry Forward Losses is an income tax rule that lets certain losses be used in later tax years instead of being lost in the year they arise. The loss can usually offset future taxable income only within legal time limits and subject to the type of loss and filing conditions.
Chapter VI-A is the section of India’s Income Tax Act that lists many deductions available from gross total income. Taxpayers often use Chapter VI-A claims to reduce taxable income after meeting each deduction’s specific conditions and limits.
Claim a Refund means a request made to recover excess tax paid or tax paid in error after filing an income tax return. In India, the Income Tax Department may allow a refund when advance tax, TDS, or self-assessment tax exceeds the final tax liability.
Computation of Income is the process of calculating taxable income by starting with total receipts and then applying permitted deductions, exemptions, and disallowed expenses under tax law. It is used to determine the amount on which income tax liability is assessed for a person or business.
Deduction is an amount allowed by tax law to reduce taxable income before tax is calculated. Common deductions cover expenses such as investments, savings, insurance, or business costs, and eligibility depends on the specific provision claimed under the Income Tax Act.
Digital Signature Certificate is an electronic certificate that verifies a person’s identity for secure digital signing. It is commonly used to sign income tax returns, company filings, and other government forms, and is issued by a licensed certifying authority under Indian law.
E-Verification is the electronic process used to confirm the identity of a taxpayer and validate an income tax return online. In India, it is commonly completed through Aadhaar OTP, net banking, bank account, demat account, or digital signature.
Financial Year is the twelve-month accounting period used to record income, expenses, and tax obligations. In India, businesses and individuals commonly use it for financial reporting and income tax filing, and it does not always match the calendar year.
Form 16 is a TDS certificate issued by an employer to a salaried employee in India. It shows salary paid and tax deducted at source during a financial year, and serves as key proof of income and tax payment when filing an income tax return.
Form 16A is a TDS certificate issued in India for tax deducted on payments other than salary, such as interest, rent, professional fees, or contract payments. It records the deductor, the taxpayer, the amount paid, and the tax deposited, and is used when filing income tax returns.
Form 26AS is an annual tax credit statement on the Income Tax Department portal that shows tax deducted at source, tax collected at source, advance tax, and self-assessment tax linked to a PAN. Taxpayers use Form 26AS to verify tax credits before filing an income tax return.
Gross Total Income is the total income calculated before deductions under the Income Tax Act. It generally combines income from salary, house property, business or profession, capital gains, and other sources, and serves as the base for computing taxable income after eligible deductions are applied.
House Property Income is income earned from owning a house, apartment, building, or land attached to it. Under Indian tax rules, rental receipts are usually taxed under this head after specific deductions and exemptions are applied.
Income Tax Act is the main law that governs how income tax is charged, collected, and enforced in India. It sets rules for taxable income, deductions, exemptions, filing duties, assessments, penalties, and taxpayer rights under the country’s direct tax system.
Income Tax Department is the government authority in India that administers direct tax laws, collects income tax, and manages taxpayer records. It also handles assessments, refunds, notices, investigations, and enforcement actions under the Income Tax Act.
Interest Under Section 234 is a statutory charge under the Income Tax Act for late filing of return, delay in payment of advance tax, or deferment of advance tax instalments. The amount depends on the nature and period of default and is added to the tax payable.
Itr is an abbreviation for income tax return, a form that taxpayers in India file with the Income Tax Department to report income, deductions, and tax paid. Filing helps determine whether extra tax is due or a refund is due.
Itr-V is the acknowledgment form for an income tax return filed in India when the return is submitted without digital verification. It must be signed and sent to the Centralized Processing Centre, usually within the prescribed time limit, so the return is treated as validly filed.
New Tax Regime is the optional Indian income tax system that applies lower slab rates in exchange for giving up many common deductions and exemptions. Salaried taxpayers, pensioners, and self-employed people can compare tax liability under this system with the old regime before filing a return.
Old Tax Regime is India’s income tax method that lets taxpayers claim many deductions and exemptions under the Income-tax Act. Salaried people, pensioners, and self-employed taxpayers often use it when eligible tax breaks make their final tax lower than under the new regime.
PAN is the Permanent Account Number, a unique ten-character alphanumeric identifier issued by India’s Income Tax Department. PAN is used to track tax filings, link financial transactions, and identify taxpayers across income tax, banking, and investment records.
Pre-filled Return is an income tax return form that already contains taxpayer details, income data, and tax deducted at source from records available to the tax department. Taxpayers review the entries, correct mismatches, and add missing income before filing.
Proof of Investment is documentary evidence showing that money has been placed in an eligible investment, such as tax-saving deposits, insurance, mutual funds, or eligible provident fund contributions. Employers and tax authorities use these records to verify claims for deductions or exemptions under income tax rules.
Rebate Under Section 87A is a tax relief under India’s income tax law that reduces the income tax payable by eligible resident individuals. It usually applies when total taxable income stays within the prescribed limit under the selected tax regime.
Refund Status is the current position of an income tax refund claim after processing by the tax department. Common statuses show whether the refund is pending, approved, issued, or delayed, and they help taxpayers track payment progress and identify issues that may need action.
Salary Income is earnings received from an employment relationship, including pay, allowances, bonuses, and other taxable benefits paid by an employer. Under Indian income tax rules, salary income is taxed under the head “Salaries” and usually includes cash pay and certain non-cash perquisites.
Self-Assessment Tax is income tax paid by a taxpayer after reducing advance tax, TDS, and TCS from the total tax liability. In India, payment is usually made before filing an income tax return when tax remains due after final calculation.
TDS Return is a tax filing statement that reports tax deducted at source to the Income Tax Department of India. Businesses and other deductors use it to disclose deducted tax, payments covered, and related deductee details within the required filing period.
Tax Deducted at Source is an Indian tax collection method in which a payer deducts tax from specified payments before making them to the recipient. The deducted amount is deposited with the government and may be adjusted against the recipient’s final income tax liability.
Tax Liability is the total amount of tax a person, business, or other entity owes to a government under tax law. Tax Liability can arise from income, profits, sales, or other taxable activities and may include unpaid tax, interest, or penalties.
Taxable Income is the portion of income that remains after allowed deductions, exemptions, and tax adjustments under the Income Tax Act. This amount is used to calculate income tax liability for individuals, firms, and companies in India.
