Income certificate is an important official document issued by the public authorities. It is approved and made available mainly by the government revenue authorities testifying the annual income of an individual or a family. This certificate establishes the annual income of the citizens for all legal and official purposes. However, individuals seeking income certificates need to furnish income proof documents that validate their earning capacity.
For most of the legal and financial transactions, for the purpose of filing taxes, applying for an education loan, opening a bank account, admission to academic institutions, availing the benefits accruing from government policies on reservation, subsidies including applying for scholarship programmes etc. for that matter, applicants need to produce and submit their income proof. To be eligible for making an income certificate, applicants should meet basic criteria that may vary from region to region. However, some common eligibility conditions are as under:
- Interested applicants must be a citizen of India and a permanent resident of the territorial jurisdiction of a specific State or a Union Territory (UT).
- Individual or family income of the applicants should meet a specified threshold criteria declared by the respective public authorities.
This article provides a brief overview of the relevant documents generally accepted as credible proof for making income certificates in India. Read about the list of income proof documents required, the application process including other relevant details.
Making of an Income Certificate – A General Overview!
| Subject | Income Proof Documents and Income Certificate |
| Issued By | Government Authorities |
| Eligibility | Indian Citizens |
| Duration for Making an Income Certificate | Certificates are issued in 14 days in general |
| How to Apply? | Though the district/state online portal or offline mode |
Income certificate reveals the monthly income of the individual or the family including other details, such as annual income from all sources, daily earnings, salary, pensions, rent, income generated through properties, and overseas remittances for that matter. Besides, it serves as an important document for several official work that involves applying for education loans including other loans, availing benefits offered under public schemes and scholarship programmes etc..
What is an Income Certificate?
An income certificate is nothing but an official document that approves and certifies the income of an individual or a family. It is a necessary document that is furnished by the revenue authorities.The income document certifies the income threshold generated by the family or an individual. Also, it is proof of the overall income earned by the household or individual within a specific period of a financial year. This certification helps to establish the economic status of the applicant making him/her eligible for various government welfare schemes and scholarship programmes, etc. Income certificate, therefore, is the certified validation of earning potential.
The income proof documents consist of all that is necessary for making an income certificate. In various states of India, the real issuing authority may be different. However, in general, the revenue officials (VAO) such as Tehsildar or Deputy Tehsildar are responsible for issuing the income certificate. In many states and union territories of India, it is also issued by the following authorities:
- Deputy Commissioner
- District Magistrates
- Sub Divisional Magistrates
- Revenue Circle Officers
- Other District Authorities.
Income certificate is an important requirement in availing the following services:
- Scholarship Programmes
- Admission in Educational Institutions
- In Job Applications
- For legal procedures including others
It carries necessary details like name, sources of income, earned income, validity period of the certificates etc. A typical format of income certificate is provided hereafter. It may be pointed out that the income certificate is attested with signature and stamped with the seal of the issuing authority/department.
Income Proof Documents: List of Documentation Requirements
In the process of applying for an income certificate, a set of crucial documents are necessary to validate the identity, residential status, and income source of the applicants.This includes the following:
- One of the following identity proof:
- Aadhaar Card
- PAN Card
- Driving License
- Ration Card with Photograph
- Passport
- Voter ID Card
- Driving Licence
- Or any government recognised document
- Address Proof/Proof of Residence (Any one is mandatory)
- Aadhaar Card
- PAN Card
- Driving License
- Utility Bills of essential services viz. electricity, gas, water, telephone etc.
- Registered Rental Agreements
- Ration Card with Photograph
- Or Any Government Recognised Document
- Documents for income proof (Any of these)
- Salary/Pay Slip
- Income Tax Return (ITR)
- Declaration from the Employer
- Affidavit of Self-employed/Self-declaration letter
- Other Optional Documents
- Passport Photograph
- Documentary Evidence of the Purpose
Following screenshot on guidelines for issuance of income certificate by the Revenue Department of the Govt. of NCT Delhi will help gain more clarity.
The application should be submitted at the office of the local district authority or uploaded online after collecting the required documents.There is a nominal fee associated with the application, that varies according to the state. The certificate is issued within a span of two weeks in general.
Let us take an example of Uttar Pradesh where applicants can apply online on the e-District portal for making their income certificate. Details are mentioned in Hindi along with documents required to be attached along with the application for making an income certificate.
Let us understand the following documents to gain greater clarity:
1. Income Tax Return (ITR)
Income Tax Return (ITR) is a form or a document that contains information about the income earned and tax applicable. Individuals who earn less than a threshold limit in a financial year, and have no tax liability do not file Income Tax Return (ITR). However, it is an important document for income proof for those citizens who are paying direct taxes. This can be used for bank loans, visa processes, and more.
2. Form 16
Form 16 is an important document used in the process of filing income-tax returns (ITR), particularly for individuals earning salary beyond a threshold limit. Employers are obliged to furnish Form 16 to their employees at the end of a financial year. This document is submitted to the government on their behalf. Form 16 is also issued by employers to the employees. It includes details about the income, deductions, and taxes paid, and thus streamlining the tax return process.
Types of Form 16
- Form 16-A is a document that provides a summarised overview of tax deducted by an employer.
- Form 16-B is another variation that presents a consolidated statement of diverse financial details associated with an employee’s income such as the salary, potential deductions from the salary if applicable for an employee, and any additional income disclosed.
3. Hindu Undivided Family (HUF)
Hindu Undivided Family (HUF) consists of all those individuals who are the direct descendents of a common ancestor. This also includes the wives and daughters of the male descendants. An individual with the spouse along with their two children can create an HUF and get certain relaxation in computation of taxes. The Hindu Undivided Family is treated as a ‘person’ under section 2(31) of the Income Tax Act, 1961, for the purpose of assessment. HUF has its own Permanent Account Number (PAN) and files tax returns independent of members and therefore their income certificate is different from the income certificate of an individual.
4. Salary/Pay Slip
If an individual does not pay ITR, they have their pay slip/salary slip as income proof. It consists of details like compensation, allowances, deductions, net pay, basic salary, etc.
5. Certification from Local Authority
Citizens can also apply for income certificates to the office of Block Development Officer (BDO) for rural areas and Sub Divisional Officer (SDO) for Municipal areas. This certificate serves as a legal and valid proof of income for various purposes.
6. Income Certificate for Persons Engaged in the Following Activities:
- Agriculture
- Horticulture
- Veterinary Activities
For persons having income from agriculture, horticulture and veterinary activities, a certificate obtained from District Agriculture Officer (DAO), District Horticulture Officer (DHO) and District Veterinary Officer (DVO) etc. serves as a proof of income. It includes information on identity, agricultural activity, income details etc., with the signature and stamp of the approval authority.
7. Bonafide Certificate
A working employee can obtain a bonafide certificate from the employer. The bonafide certificate issued by the employer indicates that the employee is working with the employer.They are accepted as supporting evidence in the process of applying for visas, and seeking financial aid, etc. A bonafide certificate can be used as income proof, however, students may be required to provide additional supporting documents or explanations to demonstrate their financial situation.
Income Proof Documents: Authorities Responsible for Providing Income Certificates!
Income certificates can be issued by different government authorities at different levels. Following table includes the list of issuing authority of income certificate.
Income Proof Documents: Applying for an Income Certificate!
The applicants need to submit the required documents in support of their income proof in India.
- Applicants should visit the state/district online portal dedicated to online application for an income certificate. It may be pointed out that offline application procedures are also available.
- If the applicant is a resident of Delhi NCT, they can easily apply on the official online portal for making an income certificate. Similarly residents of Uttar Pradesh can apply online on the e-District portal for making their income certificate.
National Governmental Services Portal
Government entities at the Center, State, District and Local levels have made the life of their citizens easier and simpler by providing online services. It has added to increased transparency and efficiency. Multiple services including the option of making an income certificate are provided through multiple websites listed at one place. The portal lists 13679 available and encourages citizens with its punchline ‘If you know a Govt. service, please let us know.’ These listed services have been well categorised with a searchable interface.
National Government Services Portal (https://services.india.gov.in) has been developed under the ambit of India Portal project in order to facilitate the listing of online services provided by various government entities under one platform.
Importance of an Income Certificate
Some of the important objectives the income certificates seek to serve are listed as under:
- Income Certificate acts as a legal proof of annual income of an individual or a family.
- This is required for seeking assistance under various government services, reduction of taxes including buying of property.
- It is also required by the students at the time of applying for educational loan or scholarship programmes and seeking admission into higher educational institutes in India or overseas.
- Compensations aftermath the natural calamities such as drought and flood, earthquake, cyclone,Tsunami etc. are offered on the basis of details available in income certificates, including others.
- It enables individuals in availing social welfare assistance programmes of the government.
- Financial assistance to handicapped individuals, such as hearing aids, prosthetic limbs, bicycles, etc.
Frequently Asked Questions (FAQs)
What are the eligibility criteria for making an income certificate?
Ans. The applicant is entitled for an income certificate provided he/she is
- An individual who is a citizen of India.
- An individual who is a permanent resident of the territorial jurisdiction of States/UTs.
Which income proof documents are required to be attached along with the application form?
Ans. Following documents are generally required for applying for an income certificate:
- Residential Proof: Residential Certificate issued by S.D.O/EPIC/Passport/Driving License/Ration Card/Govt. Id Card/ Defence ID Card/Pan Card
- Income Proof: Salary Certificate, Income Proof from Gram Pradhan/Municipality Councilor, IT Return Certificates
- Photograph
How much does a citizen pay for this service?
Ans. This service does not require any payment in some of the states in India, however, there may be a nominal fee for processing the application in other States or UTs.
What is the validity period of an income certificate?
Ans. Validity period is mentioned in the income certificate itself.
What is the general dimension of coloured photograph?
Ans. One Passport size coloured photograph of the beneficiary should have the following dimension:(Size 5cm x 4.5cm or 2” x 1.75”). This should include the full face, front view with open eyes. It should be in a plain white or off-white background with a natural expression (closed mouth).
Can ITR be a proof of income?
Ans. Yes, ITR is a proof of income. It is considered as an important document while applying for making an income certificate in India.
What is proof of income for a bank loan?
Ans. Generally, ITR (income tax return) is used as proof of income for a bank loan. However, banks ask for salary slips from salaried individuals in case an individual does not file ITR.
What is Form 16?
Ans. The document Form 16 is issued by employers to the employees. It specifies the TDS (tax deducted at source) and salary earned in a financial year. It consists of the following details on employee salary, deductions, allowances, TDS, and more.
In how many days can I get my income certificate?
Ans. An applicant may receive an income certificate within a period of two weeks in general or earlier.
What is meant by Hindu Undivided Family (HUF)?
Ans. A Hindu Undivided Family (HUF) is a single family unit of members who are the direct descendents of a common ancestor. It is treated as a ‘person’ under the provisions of the Income Tax Act, 1961, for the purpose of assessment. They have one Permanent Account Number (PAN) and file tax returns independent of members. They have a common income certificate that is different from the income certificate of an individual.
Also Read A detailed guide on online application for statewise income certificate