Income Tax Filing
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Income Tax Return Filing
Income tax return (ITR) filing is an annual obligation for taxpayers to report their income, expenses, and other financial information to the tax authorities. Proper filing ensures compliance with tax laws and helps avoid penalties. This guide covers the essentials of ITR filing, including eligibility, types of ITR forms, steps to file, and common FAQs.
Understanding Income Tax Returns
An income tax return is a form that taxpayers submit to the government, declaring their annual income, deductions, and tax payments. Based on this declaration, the government assesses the tax liability of the individual or entity.
Who Needs to File an Income Tax Return?
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Individuals
Salaried employees, self-employed professionals, freelancers, and business owners with a total income
Businesses
Companies, firms, LLPs, and other entities need to file returns regardless of profit or loss.
Others
Trusts, charitable organizations, and NRIs (Non-Resident Indians) with income in India are also required to file.
Types of ITR Forms
| Form | Applicable to |
| ITR-1 | For individuals with income up to ₹50 lakh from salary, one house property, and other sources (excluding lottery winnings and income from racehorses). |
| ITR-2 | For individuals and HUFs not having income from business or profession. |
| ITR-3 | For individuals and HUFs having income from a proprietary business or profession. |
| ITR-4 | (SUGAM): For individuals, HUFs, and firms (other than LLP) having income up to ₹50 lakh and opting for the presumptive income scheme. |
| ITR-5 | For LLPs, AOPs (Association of Persons), BOIs (Body of Individuals), and other entities. |
| ITR-6 | For companies other than those claiming exemption under section 11. |
| ITR-7 | For persons including companies required to furnish returns under sections 139(4A), 139(4B), 139(4C), 139(4D), 139(4E), or 139(4F). |
Steps to File an Income Tax Return
1. Gather Required Documents
Before you begin, collect the necessary documents:
- Form 16 (for salaried employees)
- Form 26AS (tax credit statement)
- Bank statements
- Investment proofs (for deductions)
- Aadhaar card and PAN card
- Other relevant financial documents
2. Choose the Correct ITR Form
Select the appropriate ITR form based on your income sources and category. Using the wrong form can lead to processing delays and potential penalties.
3. Register/Login on the Income Tax e-Filing Portal
Visit the official income tax e-filing website. If you are a new user, register using your PAN. Existing users can log in with their credentials.
4. Fill in the Form
Enter all necessary details such as personal information, income details, deductions, and tax paid. Ensure accuracy to avoid discrepancies.
5. Verify Your Details
Double-check all entered information for accuracy. Verify your tax calculations and ensure all deductions and exemptions are correctly applied.
6. Submit the Form
Once verified, submit the ITR form electronically. After submission, you will receive an acknowledgment number.
7. Verify the ITR
The final step is to verify your ITR. You can do this electronically using Aadhaar OTP, net banking, or by sending a physical copy of the signed ITR-V to the CPC (Centralized Processing Center) in Bengaluru.
Illustration of Income Tax Calculator 2024
Ms. Preeti, a salaried employee, earns a basic salary of Rs. 15,00,000 per annum. She lives in a rented apartment in Delhi where she pays a rent of Rs. 30,000 per month, and her company gives her a monthly HRA of Rs. 40,000 along with Special Allowances of Rs. 20,000 per month and an annual LTA (Leave Travel Allowance) of Rs. 20,000.
| Details | Amount | Exemptions | Taxable Income as per the Old Regime | Taxable Income as per the New Regime |
| Basic Income | Rs. 15,00,000 | – | Rs. 15,00,000 | Rs. 15,00,000 |
| House Rent Allowance | Rs. 4,80,000 | 3,60,000 | Rs. 1,20,000 | Rs. 4,80,000 |
| Special Allowance | Rs. 2,40,000 | – | Rs. 2,40,000 | Rs. 2,40,000 |
| Leave Travel Allowance (LTA) | Rs. 20,000 | Rs. 16,000 | Rs. 4,000 | Rs. 20,000 |
| Standard Deductions | – | Rs. 50,000 | Rs. 50,000 | Rs. 50,000 |
| Net Salaried Income | – | – | Rs. 18,14,000 | Rs. 21,90,000 |
Illustration of Income Tax Calculator 2024
Incorrect Personal Information: Ensure your name, PAN, and address are correctly entered.
Wrong ITR Form: Filing with the wrong form can lead to rejection.
Mismatched TDS Details: Cross-check TDS details with Form 26AS.
Not Reporting All Income: Include all sources of income, including interest and rental income.
Skipping Deductions: Claim all eligible deductions under sections 80C, 80D, etc.
Missing the Deadline: File your return before the due date to avoid penalties.
Calculation of Income Tax under the Old Tax Regime
| Details | Amount (in Rs.) | Total (in Rs.) |
| Salary | 18,14,000 | – |
| Other Sources Income | 24,000 | – |
| Gross Total Income | – | 18,38,000 |
| Deductions | ||
| Section 80C | 1,50,000 | – |
| Section 80D | 15,000 | – |
| Section 80TTA | 10,000 | 1,75,000 |
| Gross Taxable Income | – | 16,63,000 |
| Total tax (including cess) | – | Rs. 3,23,856 |
Calculation of Income Tax under the New Tax Regime
| Details | Exemptions | Amount |
| Up to 3,00,000 | Exempt from tax | NIL |
| Rs. 3 lakhs – Rs. 6 lakhs | 5% [5% of (Rs. 6 lakhs minus Rs. 3 lakhs)] | Rs. 15,000 |
| Rs. 6 lakhs – Rs. 9 lakhs | 10% [10% of (Rs. 6 lakhs minus Rs. 9 lakhs)] | Rs. 30,000 |
| Rs. 9 lakhs – Rs. 12 lakhs | 15% [15% of (Rs. 9 lakhs minus Rs. 12 lakhs)] | Rs. 45,000 |
| Rs. 12 lakhs – Rs. 15 lakhs | 20% [20% of (Rs. 12 lakhs minus Rs. 15 lakhs)] | Rs. 60,000 |
| Rs. 15 lakhs & Above | 30% [30% of (21,90,000 -15,00,000)] | Rs. 2,07,000 |
| Cess | 4% of total tax [4% of (Rs. 15,000 + Rs. 30,000+ Rs. 45,000 + Rs. 60,000 + Rs 2,07,000) | Rs. 14,280 |
| Total Income Tax | Rs 15,000 + Rs. 30,000+ Rs. 45,000 + Rs. 60,000 + Rs. 2,07,000 + Rs. 14,280 | Rs. 3,71,280 |
FAQs on Income Tax Return Filing
Any individual or entity whose income exceeds the basic exemption limit must file an income tax return. This includes salaried individuals, self-employed professionals, businesses, and NRIs with income in India.
The deadline for filing individual tax returns is typically July 31st of the assessment year. For businesses requiring audit, the deadline is usually September 30th.
Late filing attracts a penalty under Section 234F. The penalty amount can be up to ₹10,000, depending on the delay.
Yes, you can revise your ITR if you discover errors or omissions after submission. The revision must be done before the end of the relevant assessment year.
Essential documents include Form 16, Form 26AS, bank statements, investment proofs, Aadhaar card, and PAN card.
You can check your ITR status on the income tax e-filing portal using your acknowledgment number or login credentials.
Form 26AS is a consolidated tax statement that includes details of tax deducted at source (TDS), tax collected at source (TCS), and advance tax payments made.
Yes, you can file a belated return for previous years within the allowed time frame, subject to penalties and interest.
Yes, verifying the ITR is mandatory to complete the filing process. You can verify it electronically or send a physical copy of the signed ITR-V to the CPC.
Filing an ITR provides several benefits, including:
- Proof of income for loan applications.
- Claiming tax refunds.
- Carrying forward losses.
- Establishing financial credibility.
The financial year (FY) is the year in which income is earned, while the assessment year (AY) is the year following the financial year in which the income is assessed and taxed.
You can e-verify your ITR using methods such as Aadhaar OTP, net banking, bank account number, Demat account number, or an Electronic Verification Code (EVC).
Filing your income tax return on time ensures compliance with tax laws and helps avoid unnecessary penalties. It also provides an opportunity to claim deductions and refunds, contributing to better financial planning. Always seek professional advice if you're unsure about any aspect of the filing process.