Traders enjoy the same basic income‑tax exemption limit as salaried persons. Under the old regime, the limit is ₹2.50 lakhs for those below 60 years, ₹3 lakhs for senior citizens, and ₹5 lakhs for super‑seniors. In the new regime the limit is ₹4 lakhs for everyone, regardless of age.
A trader must file an income‑tax return if his total income before deductions (such as PF, PPF, housing‑loan repayment, mediclaim premium, etc.) exceeds the applicable threshold. The filing deadline depends on whether the trader has business income and whether his accounts must be audited.
If there is no business income, the return is due by 31 July of the following year. For traders with business income whose accounts are not audited, the due date is 31 August; if audited, it is 31 October. Traders subject to transfer‑pricing rules have until 30 November, and late filings can be made until 31 December.
When a trader’s turnover crosses prescribed limits, a Chartered Accountant must audit the accounts and submit the report before the filing due date. Even if net profit is below the required percentage of turnover, an audit may still be mandatory under certain circumstances.
For more clarity, traders can email their questions to askwalletwise@nw18.com, and a financial expert will respond.