A Step-by-Step Guide to Income Tax Return Filing in India

Income tax plays a very important role in the growth of a country. It is the main source for the government. Income tax plays a very important role in the growth of a country. It is the main source for the government. The amount is used to various things such as to pay salaries, welfare schemes, government projects etc.

What is Income Tax Return (ITR)

Income tax return (ITR) is a form used to show the gross taxable income of an individual for the given fiscal year. It is typically used by the taxpayers to formally declare their income, any deductions claimed, exemptions etc. Thus, it calculates your net income tax liability in a fiscal year. Income tax return filing is a mandatory process to be followed for many reasons such as future loan perspective.

As per the income tax act of 1961, any person who is under 60 years of age must file tax returns in case if some of the part of their income is taxable.

Type of ITR forms

There are 9 different types of ITR forms available from ITR 1 to ITR 7. You can use the forms as per your details while filing the ITR form. Each user should choose the appropriate form that suits them

Is it mandatory to file Income Tax Return?

In case if your income is more than the basic exemption limit given for income tax then it is mandatory for you to file the income tax return.

Who should file Income Tax Returns?

The income tax return has to be filled by individual or business who fall within certain income brackets. In case if you don’t fall into that tax bracket then you are exempted from filling the return

Documents required to file ITR

The below are the important documents that are required while filing the ITR

Form – 16

It is a TDS certificate which is issued by your employer when the TDS is deducted from your salary. It has two parts including Part A containing the employer’s and employee’s details, including the name and address, Permanent Account Number (PAN), and TDS details. Part B includes the details of salary paid, exemptions allowed, deductions claimed, and tax payable on the employee’s income

Bank/Post Office Interest Certificates:

As per the Income Tax Act, interest earned from post office savings accounts, savings bank accounts, recurring deposits and fixed deposits are taxable. So, you need to provide the break-up of the interest received from different sources.

Form-16A and Other TDS Certificates:

Salaried individuals have to collect other TDS certificates if applicable on them. Banks are required to deduct TDS if your total fixed deposit income goes above Rs. 40,000 (50,000 for senior citizens).

Form 26AS:

Form 26AS is like a tax passbook which includes the information about taxes deposited and deducted against your PAN. You can download this from the new income tax portal.

Definition of E-filing

E-filing is the process of electronically furnishing the returns of the taxes paid by you. The government allows both Online and Offline Income Tax Return (ITR) filing, whichever is convenient for the taxpayer. However, E-filing or electronic ITR Filing has overtaken the traditional offline method as many taxpayers find it convenient to file the returns from their offices without much paperwork.

Filing your Income Tax Return (ITR) is not just a legal obligation but also a crucial step in your financial planning. Understanding the types of ITR forms, the mandatory documents, and the process of e-filing can significantly simplify this task. By complying with tax laws, you contribute to the nation’s development and ensure your financial credibility, which is essential for future financial endeavors like applying for loans. Remember, timely and accurate filing of your ITR can save you from penalties and help you avail benefits under various tax-saving schemes. Stay informed, stay compliant, and make tax filing a smooth and efficient process.