A Beginner’s Step by Step Guide For Income Tax Filing

A Beginner’s Step by Step Guide For Income Tax Filing

Every taxpayer in India is scheduled for the annual process of income tax return filing. The compulsory duty of income tax filing is followed by multiple reasons such as the future loan prospect and financial record maintenance. For all the Audit cases, the upcoming due date for filing the income tax return is 30th September 2020. For the assessees, the due date of filing income tax return under section 92E is the end date of November 2020. One should recognize the fact that all the assessees who have an income of 5 lakhs/year have to file income tax returns online. The digital portal of ITR returns online is also available for all assessees to claim and track their refunds effortlessly. 

Nowadays, everything has become digitized and so does the process of filing ITR. People are finding online ITR filing much convenient and the e-filing of ITR makes things quicker, easier and more effortless. You can simply file your Income Tax Return from anywhere- be it your office or home. E-filing of ITR is also saved money as you don’t have to hire an additional person to do the job for you.

Here is a step by step guide for filing ITR returns online

  1. Keep your important documents ready

The primary significant step is to gather all important documents of all financial value such as assets, income, investment funds, and the number of bank accounts. The important govt. documents are- Aadhaar enrolment ID or Aadhaar number and Permanent Account Number (PAN) card. Taxpayers don’t have to submit these documents while filing ITR online, however, the details of these documents are important for filling the online return form without a mistake. If the assessees are having additional capital earnings like dividend income and rental income, they have to give precise details of all of them while filing an income tax return online.  It is further recommended that the taxpayers should maintain an individual file of documents for all records of previously filed ITRs. Here is a checklist for documents to file ITR Online-

Personal Documents: 

  • Details of domestic assets and liabilities.
  • Permanent Account Number (PAN) card.
  • Details of foreign assets.
  • Aadhaar card or Aadhaar enrollment number.

Income-related Documents

  • Details of outside income received annually
  • Balance sheet, and other audit reports
  • Details of Sales & Turnover
  • P&L account statement 
  • Yearly Gross Receipts 
  • Form 16/16A/16B to fill the details of income

Bank-related Documents

  • Interest statement of the year
  • Bank statement
  • Details of all bank accounts 

Tax-related Documents

  • Saving certificate or deduction
  • Copy of last year tax return
  • Form 26AS to cross-check TDS details
  • TDS certificate

Real Estate Related Documents

  • Investment documents to show capital 
  • Buyer agreement, sale deed and
  • Lease deed to show rental income
  • Gains on sale and details of exemption 

Investment and Expense Related Documents

  • Premium receipt for life insurance plans
  • Preventive checkup receipts
  •  Medical insurance premium 
  • Interest on a home loan
  • Proof of investment 
  • Home loan statement 
  1. Create an ITR Account for E-filing

After gathering all mandatory documents, the user has to visit the e-filing website https://incometaxindiaefiling.gov.in. On the e-portal of the income tax department, the user would require the user ID (PAN number) to log in for filing the ITR online form. If you are doing it for the first time, you have to sign up for creating an ITR e-filing account on the same website. After completing signing up/ logging in, you have to press the ‘e-File’ menu. You will see a link of ‘income tax return’, click on it. Next, you have to perform the specified tasks on the income tax return page such as-

  • Select ‘assessment Year’
  • Auto-populate your PAN 
  • Select ‘original/revised return’ for the ‘filing type’
  • Select Your ‘ITR form number’
  • Select ‘prepare and submit online’ as your mode of submission.
  • Finally, click on ‘continue’
  1. Pick out the Right ITR Form 

Once you are done with the log-in at the ITR e-filing account, on the dashboard, you will see an option for filing the income tax return. After clicking this option, you have to select the AY (assessment year). Then you have to choose the right ITR form to fill up. Here is a list of various kinds of ITR forms

  • ITR 1 – For those residents who have an annual income up to Rs.50 lakhs, single House Property, Agricultural Income, Salaried income and Other Sources Income.
  • ITR 2 – For those residents and HUFs who earn profits but not from business or profession.
  • ITR 3 – For those residents and HUFs who have income from professional jobs or business. 
  • ITR 4 – Applicable for the profession sanctioned under 44AD, 44ADA or 44AE. It is also applicable for residents, HUFs and Firms having total revenue of up to Rs.50 lakhs from the business.
  • ITR 5 – Applicable for persons other than Company, Individual, HUF and Form ITR-7 assesses. 
  • ITR 6 – Companies earning our site income under section 11 are applicable to this ITR form.  
  • ITR 7 – Companies and persons who are compelled to appoint income under sections 139(4D)/139(4A)/139(4C)/139(4B) etc. 
  1. Fill Out Details Accordingly

To file ITR return online, the most mandatory details are Aadhaar number or PAN. Then you have to fill your chosen ITR form accordingly by following the proper details engraved on your monetary documents. For example, if you are filing an ITR-1 form, you have to put details of your house property income, a single amount of income/loss and the break-up of salary. 

The taxpayers are obligated to go through the form filling instruction very carefully. To avoid data loss/or session timeout while filing e-form of ITR, you can save the ITR that you have entered by clicking the option of ‘save draft’. This saved draft will be valid for the next 30days unless there is no modification in the XML Scheme of the mentioned ITR. Once you are done with filling the form, you have to proceed to the ‘taxes paid and verification’ tab.

  1. Verify your return filing details & upload the final submission

The last step of filing ITR Online is the verification of entered details and their final submission through uploading. For the verification process, you have to tap on the ‘taxes paid and verification’ tab. For e-verification, you can choose any of the following options-

  1. I would like to e-Verify
  2. I would like to e-Verify later.
  3. I don’t want to e-Verify and would like to send a signed ITR-V through normal or speed post.

If you choose any of the first two options, there are five ways in which you can do the verification-

  1. Via Aadhaar-based OTP
  2. Generating EVC via Net-banking
  3. Generating EVC via bank account
  4. Verifying tax-returns through Demat account
  5. Generating EVC through your bank ATM

But if you choose the 3rd option, you have to send a signed ITR-V/Acknowledgement receipt through speed post. 

Once you choose the verification mode, you have to click on the button saying ‘preview and submit’ to confirm all the details that you have inscribed in the ITR. Once the revision is done, proceed for ‘submit’. If you have opted for e-verification, you will receive an EVC/OTP which needs to be submitted along with the final uploading of the file. Remember, the window of ITR will be open for 4months (120days) for return verification once you upload the documents. For the confirmation of Income Tax Return submission, go to ‘my account’ to click on the option of ‘e-Verify return’. If you wish to see the uploaded ITRs, you have to go through this link- https://incometaxindiaefiling.gov.in.

Conclusion

Hopefully, the step-by-step guide for filing Income Tax Return Online has been useful. Thank you for reading this far! 

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