Filing taxes isn’t a tricky process anymore. Keep all the necessary documents ready and it will be wrapped up within half an hour. We suggest avoiding waiting till the last minute for a pressure-free experience.
We suggest avoiding waiting till the last minute for a pressure-free experience. Being punctual in ITR filing can protect you from penalties (which may go up to 10,000) and prevent losses such as interest on refunds.
Before we begin, please note that if you have not linked your PAN card to your Aadhaar, the former shall be treated as inoperative.
Organize your documents
This is the first and the lengthiest process. Know all the documents that you need to gather.
- Permanent Account Number (PAN), as it’s necessary to log into the income tax website.
- Aadhaar number
- A copy of the tax return from the previous year
- Bank statements from operational accounts, at least two years.
- Form 16 or Salary certificate received by an individual at the end of a financial year from the employer. It consists of the details of
- salary paid
- deductions (including Provident Fund or PF)
- tax deducted over the period.
Note – In case of a job change, make sure that you receive Form 16 from your previous employer as well.
- 26 AS – This document includes details of all the taxes deducted from your salary, interest income, etc. during the year. (This must match your TDS certificates because you get credit only for the deductions that are accurately visible in your tax statement.)
- Downloaded interest certificates from Net banking facilities (to add income from savings accounts, fixed deposits, etc.)
Additional Documents that may apply to you
- Form 12 B (only applicable to those who have joined a new organization in the middle of the year.) Details from this are used to cut exact TDS.
- Withdrawal of PF- the document is important as the amount withdrawn is taxable in the hands of the employee.
- Form 10 E – It documents arrears of salary for a particular year and raises the tax liabilities for the same.
- Pension certificate
- Form 67– this consists of income proofs and tax returns filed in foreign countries.
Documents required for saving taxes
- Equity Linked Savings Scheme (ELSS), the contribution made towards PPF, EPF, Sukanya Samriddhi Yojana, tax-saving fixed deposits, Senior Citizen Savings Scheme (SCSS), etc can be claimed under 80 C.
- Receipts of donations made (It should be recorded with the PAN number, name, and address of the donor.)
- Education Loan interest paid receipts
- Medical insurance, both for self and family
- School fees
- Rent documents
- Housing loan etc
Calculation of income and tax liability
- After claiming all the eligible tax-saving deductions under 80 C, 80 D, etc, and also exemptions such as HRA (house rent allowance), LTA (leave travel allowance), etc, your taxable income will reduce significantly.
- Minus the TDS reflected in your Form 26AS from your total taxable income.
- By filling in income details and deductions/exemptions in the ITR, then the utility form will also auto-calculate tax payable by you or show the refund as applicable.
Note – If there is any additional tax liability due to you, then ensure its payment before filing your tax return.
Choose the ITR form which fits you
This step is important as defaulting here would lead to the rejection of the form.
ITR Form 1 is for individuals with income under 50 lakhs and sources encompassing salary/pension, one house property, and income from other sources such as interest earned on a saving account, etc.
- People who have received capital gains other than those mentioned or have more than one house property then they would have to choose ITR-2.
- ITR -2 is also used if one holds unlisted equity shares.
- Pre-filled information such as salary details, interest income from bank FD (in case TDS is subtracted), etc. is reflected on the online platform (www.incometaxindiaefiling.gov.in.)
- As an alternative, the XML file can be downloaded from the e-filing website of the income tax department, and then imported into the Excel utility and the details will get pre-filled automatically.
Without verification, the ITR will be considered invalid. An individual has 120 days (from the date of filing) for the verification. Here are three distinct ways to get it done–
- Electronic verification through Aadhaar OTP.
- EVC via Net banking facility
- By sending ITR-V in hard copy to CPC, Bengaluru
Pre-validation of Bank Account
The income tax department issues e-refunds when the taxpayer’s PAN is linked and pre-validated. It can be done through www.incometaxindiaefiling.gov.in, with the PAN number as the user ID in the login process.
Once you have completed all the steps then revise the ITR from the beginning to make sure that all details are accurate and the documents are uploaded properly.
It’s best to gather everything before you sit to file your ITR. Read the blog Don’t hesitate to consult a professional tax advisor in case of doubts. Diligen encourage you to be honest and transparent in the procedure.